In this article, we will discuss some of the best dividend stocks under $50.
AI stocks are stealing the spotlight today as the appetite for these services continues to gain traction globally. This surge in interest has temporarily diverted investor attention from dividend-paying equities. This year, dividend stocks have once again lagged behind the market, a trend highlighted by Dan Lefkovitz, a strategist at Morningstar Indexes, during a recent interview with the firm. Here are some comments from the analyst:
“I just want to mention two interesting observations. One, interest rates have come down this year, yet dividend-paying stocks have underperformed. There’s this conventional wisdom that we’ve talked about in the past that falling rates are good for dividend payers and rising rates are bad for dividend payers, yet dividend stocks have underperformed in a falling rate environment. Second, outside of the US, dividend stocks are a little bit ahead of the broad market. We can table those, but I just thought they’re interesting to note.”
That said, analysts predict this trend won’t persist, as dividend stocks are expected to regain their strength and prominence soon. Bank of America analyst Ohsung Kwon suggested that a dividend revival might be on the horizon. His team anticipates a 10% increase in overall dividends from the companies in the broader market in 2025, driven by investors’ growing preference for cash. Highlighting this trend, major tech firms began paying dividends for the first time this year. According to Janus Henderson, these tech giants accounted for roughly 25% of the total underlying dividend growth in the US during the third quarter.
Also read: 10 Best European Dividend Stocks To Buy
When it comes to dividend stocks, analysts consistently recommend prioritizing dividend growth over chasing high yields. Dan Lefkovitz, a strategist with Morningstar’s Index team, emphasized this approach, pointing out that dividend growth is a completely different ball game compared to high-dividend investing. He explained that dividend growth signals a company’s strong competitive position and improving prospects. A dividend-growth portfolio typically mirrors the market more closely in terms of sector exposure and growth-versus-value traits, including metrics like price-to-earnings ratios. While it maintains a value bias, it leans more toward the core market than a high-dividend portfolio.
Over the years, companies with a track record of steadily increasing their dividends have generally outperformed non-dividend-paying firms while experiencing lower volatility. Although dividends are not set in stone and can vary, as seen in the current climate, they have significantly contributed to overall equity returns over time. Between 1930 and 2023, dividends and their reinvestment made up 40% of the annualized total returns in the broader market, with the rest driven by capital gains.
Maintaining steady dividend growth is a demanding goal, as it necessitates exceptional financial stability. For businesses still in their growth phase with relatively lower stock prices, assessing the sustainability of their dividends becomes an essential and simple factor to analyze. This article explores some of the top dividend stocks currently priced under $50.
Photo by Annie Spratt on Unsplash
Our Methodology:
For this list, we used a Finviz stock screener to find dividend stocks trading below $50 as of the close of December 20. From the initial list, we narrowed down the selection to companies that pay regular dividends to shareholders and possess strong dividend policies, ensuring consistent future dividends. From the resultant list, we picked 10 stocks with the highest number of hedge fund investors, using Insider Monkey’s Q3 2024 database of 900 hedge funds and their holdings. These stocks are ranked in ascending order of hedge funds having stakes in them.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
13. Hercules Capital, Inc. (NYSE:HTGC)
Number of Hedge Fund Holders: 7
Share Price as of the Close of December 20: $19.21
Hercules Capital, Inc. (NYSE:HTGC) is a California-based capital market company that mainly offers senior secured loans to high-growth, venture capital-backed, and institutional-backed companies in a wide range of industries. The business development company emphasizes emerging trends in technology, life sciences, and green energy. A significant portion of Hercules’s assets is tied up in debt instruments that include warrants, equity, and options, enabling the company to profit from the success of the businesses it supports. Since its founding, more than 250 of its portfolio companies have either gone public through IPOs, merged with other entities, or been acquired, according to the company. In the past 12 months, the stock has surged by nearly 16%.
In the third quarter of 2024, Hercules Capital, Inc. (NYSE:HTGC) reported revenue of $125.2 million, which showed a 7.28% growth from the same period last year. The company posted a net investment income (NII) of $83.2 million, or $0.51 per share, reflecting an 8.3% year-over-year growth. This NII provided 128% coverage of the base cash distribution. During the same period, total gross debt and equity commitments reached $430.7 million, while total gross funding amounted to $272.0 million. The firm’s assets under management grew to approximately $4.6 billion, marking a 10.9% increase compared to the previous year.
Hercules Capital, Inc. (NYSE:HTGC) is one of the best dividend stocks under $50 as the company has a strong history of paying supplemental dividends to shareholders. On October 28, the company declared a quarterly dividend of $0.40 per share and a supplemental dividend of $0.08 per share. In addition, the stock offers an attractive dividend yield of 9.94%, as of December 23.
At the end of Q3 2024, 7 hedge funds tracked by Insider Monkey reported having stakes in Hercules Capital, Inc. (NYSE:HTGC), compared with 11 in the previous quarter. These stakes have a collective value of over $18.4 million. Among these hedge funds, Two Sigma Advisors was the company’s leading stakeholder in Q3.
12. Brookfield Infrastructure Partners L.P. (NYSE:BIP)
Number of Hedge Fund Holders: 15
Share Price as of the Close of December 20: $31.36
Brookfield Infrastructure Partners L.P. (NYSE:BIP) is a Canadian limited partnership that specializes in acquiring and managing infrastructure assets worldwide. The company boasts strong diversification, with over 45 businesses spanning four key sectors: utilities, midstream, data, and transport infrastructure. While two of these businesses generate more than 10% of the company’s funds from operations (FFO), it is well-equipped to handle economic challenges. Nearly 90% of its FFO is derived from regulated or contracted sources, providing reliable and stable cash flows.
In the third quarter of 2024, Brookfield Infrastructure Partners L.P. (NYSE:BIP) reported revenue of $5.27 billion, up from $4.5 billion in the same period last year. The company performed strongly, successfully meeting its strategic goals, including achieving its $2 billion capital recycling target for the year. As interest rates decline, the company has entered a new market environment characterized by increased deal activity. This has generated a substantial investment pipeline, further supported by growth in sectors tied to AI and the associated energy demands.
In addition, Brookfield Infrastructure Partners L.P. (NYSE:BIP)’s cash position also remained strong. It ended the quarter with over $1.6 billion available in cash and cash equivalents and its total assets amounted to over $105.2 billion. In the first nine months of the year, the company generated $3.1 billion in operating cash flow, growing from $2.6 billion in December 2023.
Brookfield Infrastructure Partners L.P. (NYSE:BIP) currently offers a quarterly dividend of $0.405 per share and has a dividend yield of 5.06%, as of December 23. It is one of the best dividend stocks on our list as the company maintains a 16-year track record of consistent dividend growth.
As of the close of Q3 2024, 15 hedge funds tracked by Insider Monkey held stakes in Brookfield Infrastructure Partners L.P. (NYSE:BIP), up from 14 in the previous quarter. These stakes have a total value of approximately $207 million. With over 5.4 million shares, Select Equity Group was the company’s leading stakeholder in Q3.
11. NNN REIT, Inc. (NYSE:NNN)
Number of Hedge Fund Holders: 20
Share Price as of the Close of December 20: $40.35
NNN REIT, Inc. (NYSE:NNN) is a Florida-based real estate investment trust company that mainly invests in high-quality properties subject to long-term NNN leases. In the third quarter of 2024, the company posted $218.6 million in revenue, marking a 6.55% year-over-year increase. Funds from operations (FFO) rose to over $154 million, up from $147.2 million in the previous year. As of September 30, 2024, the company maintained a robust occupancy rate of 99.3% and had an average remaining lease term of 10 years. During the quarter, it allocated $113.6 million to property investments, acquiring eight assets spanning approximately 626,000 square feet of leasable space at an initial cash cap rate of 7.6%. Moreover, it divested nine properties for $20 million, generating $7.8 million in gains from these sales.
NNN REIT, Inc. (NYSE:NNN) is favored by investors as the company follows a straightforward investment approach that has consistently driven its stable performance. It focuses on single-tenant net lease retail properties, where tenants are responsible for covering all operating costs, such as maintenance, property taxes, and insurance. This setup ensures dependable rental income, which increases each year through fixed adjustments or inflation-linked escalations. The company prioritizes acquiring properties in strong markets to maintain its attractiveness to potential tenants if existing leases are not extended. Furthermore, it manages a diversified portfolio across multiple regions, industries, and tenant categories.
NNN REIT, Inc. (NYSE:NNN), one of the best dividend stocks under $50, has been rewarding shareholders with growing dividends for the past 35 years. The company currently pays a quarterly dividend of $0.58 per share and has a dividend yield of 5.74%, as of December 23.
With a collective stake value of over $230.5 million, 20 hedge funds tracked by Insider Monkey held positions in NNN REIT, Inc. (NYSE:NNN) at the end of Q3 2024. In the previous quarter, 16 funds held investments in the company.
10. British American Tobacco p.l.c. (NYSE:BTI)
Number of Hedge Fund Holders: 24
Share Price as of the Close of December 20: $36.24
British American Tobacco p.l.c. (NYSE:BTI) ranks tenth on our list of the best dividend stocks under $50. The London-based company specializes in the manufacturing of cigarettes, tobacco, and various other nicotine products. The company has faced substantial challenges recently, including a sharp 34% decline in its stock price between June 2022 and April 2024, significantly underperforming compared to the broader market. While the company has shown signs of recovery, it remains below its historical growth trajectory, largely due to a substantial $31.5 billion write-down in 2023. This development has raised concerns among investors about whether BTI represents a value opportunity or a potential liability, especially as it shifts its focus from traditional tobacco products to next-generation nicotine offerings like vapes and pouches.
In the first half of 2024, British American Tobacco p.l.c. (NYSE:BTI) saw a 6.8% decline in cigarette sales compared to the same period in 2023. This followed volume drops of 5.3% in 2023 and 5.1% in 2022, contributing to a sharp decline in the company’s stock, with its market capitalization falling by over 40% at one point. However, like others in the industry, British American Tobacco has countered declining volumes by raising prices, leading to higher profits this year and a subsequent stock rebound. Thanks to the addictive nature of nicotine, smokers tend to be a loyal and consistent customer base. In the past 12 months, the stock has surged by over 24%.
In addition, British American Tobacco p.l.c. (NYSE:BTI)’s strong dividend history makes it an attractive investment for income investors. The company anticipates generating £40 billion (approximately $50.57 billion) in free cash flow, excluding dividends, over the next five years. It has raised its dividend every year since 2018, which makes BTI one of the best dividend stocks on our list. The company offers a quarterly dividend of $0.7431 per share and has a dividend yield of 8.27%, as of December 23.
The number of hedge funds tracked by Insider Monkey owning stakes in British American Tobacco p.l.c. (NYSE:BTI) grew to 24 in Q3 2024, from 21 in the previous quarter. These stakes have a total value of more than $1.3 billion. Rajiv Jain’s GQG Partners owned the largest stake in the company in Q3.
9. Enterprise Products Partners L.P. (NYSE:EPD)
Number of Hedge Fund Holders: 25
Share Price as of the Close of December 20: $30.99
Enterprise Products Partners L.P. (NYSE:EPD) is a Texas-based midstream natural gas and crude oil pipeline company that offers petrochemicals and related products. The company has gained traction among investors because of its solid cash position. In the most recent quarter, it generated $2.1 billion in operating cash flow, reflecting a 4% year-over-year increase. Distributable cash flow reached $2 billion, marking a 5% rise compared to the same period last year. Over the twelve months ending September 30, 2024, the company utilized 56% of its Adjusted Cash Flow from Operations (CFFO) for distributions to common unitholders and the buyback of partnership common units.
This cash position has allowed Enterprise Products Partners L.P. (NYSE:EPD) to grow its dividend for 26 consecutive years. On October 2, it declared a quarterly dividend of $0.525 per share, which was in line with its previous dividend. The stock’s dividend yield on December 23 came in at 6.77%.
In addition to its dividend, Enterprise Products Partners L.P. (NYSE:EPD) also reported strong earnings in the third quarter of 2024. The company posted revenue of $13.78 billion, marking a nearly 15% increase compared to the same period last year. However, the revenue fell short of analysts’ expectations by over $97 million. The company’s operating income was $1.78 billion, and net income reached $1.43 billion, reflecting year-over-year growth from $1.7 billion and $1.3 billion, respectively.
Enterprise Products Partners L.P. (NYSE:EPD)’s stability stems from its largely fee-based business model, which reduces its exposure to commodity and spread risks. Approximately 90% of its contracts feature inflation-adjustment provisions. Moreover, the company has consistently taken a conservative stance on leverage, maintained strong distribution coverage, and carefully managed its growth capital expenditures.
Insider Monkey’s database of Q3 2024 indicated that 25 hedge funds held stakes in Enterprise Products Partners L.P. (NYSE:EPD), growing from 23 in the previous quarter. These stakes are worth nearly $316 million in total.
8. UGI Corporation (NYSE:UGI)
Number of Hedge Fund Holders: 26
Share Price as of the Close of December 20: $27.27
UGI Corporation (NYSE:UGI) is an American natural gas distribution company that offers safe, reliable, and affordable energy to its consumers. The company’s successful execution of its strategy resulted in record EBIT from its natural gas operations, consistent reductions in operating and administrative expenses, disciplined capital allocation, enhanced liquidity, and greater financial flexibility within its balance sheet. Since the start of 2024, the stock has surged by nearly 11%.
In fiscal Q4 2024, UGI Corporation (NYSE:UGI) reported revenue of $1.24 billion, down 11.54% from the same period last year. The revenue also missed analysts’ estimates by $409 million. However, the company successfully reduced operating and administrative expenses by $75 million across all segments compared to the previous year. It deployed approximately $900 million in capital, with 80% of this amount directed toward regulated utilities, mainly for infrastructure replacement and improvements, as well as to the Midstream and Marketing segment. Moreover, the company has provided an adjusted EPS guidance range of $2.75 to $3.05 per diluted share for the fiscal year ending September 30, 2025. This forecast assumes typical weather conditions and the current tax environment.
UGI Corporation (NYSE:UGI) is one of the best dividend stocks on our list as the company has been making regular dividend payments for 140 consecutive years. The company achieved a 10-year CAGR of 6%. In addition, it has raised its payouts for 37 consecutive years. Currently, it offers a quarterly dividend of $0.375 per share and has a dividend yield of 5.44%, as of December 23.
UGI Corporation (NYSE:UGI) was a part of 26 hedge fund portfolios at the end of Q3 2024, compared with 32 in the previous quarter, as per Insider Monkey’s database. The stakes held by these funds have a consolidated value of over $165.4 million. Among these hedge funds, AQR Capital Management was the company’s leading stakeholder in Q3.
7. Nutrien Ltd. (NYSE:NTR)
Number of Hedge Fund Holders: 33
Share Price as of the Close of December 20: $44.58
Nutrien Ltd. (NYSE:NTR) is a Canada-based fertilizer company and one of the largest potash producers in the world. The stock has fallen by nearly 16% since the start of 2024, with the company’s difficulties mirroring wider challenges in the agricultural sector, such as declining crop prices and global trade disruptions due to geopolitical tensions. However, its diversified portfolio, which includes potash, nitrogen, and phosphate products, provides some insulation from market fluctuations. Furthermore, Nutrien’s investments in digital technologies and sustainable farming practices position it well to capitalize on long-term industry trends.
In the third quarter of 2024, Nutrien Ltd. (NYSE:NTR) reported revenue of $5.09 billion, a decrease of more than 5% compared to the same period last year. The company saw increased potash sales volumes and lower operating costs during the first nine months of 2024, driven by its six-mine network and global distribution capabilities to meet growing customer demand. In addition, strong demand for crop nutrients in North America for the fall application season is emerging, following a period of lower field activity in Q3.
On November 6, Nutrien Ltd. (NYSE:NTR) declared a quarterly dividend of $0.54 per share, which was in line with its previous dividend. Overall, the company has raised its payouts for five consecutive years, which makes NTR one of the best dividend stocks under $50. The stock offers a dividend yield of 4.71%, as of December 23.
Of the 900 hedge funds tracked by Insider Monkey at the end of Q3 2024, 33 hedge funds held stakes in Nutrien Ltd. (NYSE:NTR), compared with 35 in the previous quarter. The total value of these stakes is over $411.7 million. With nearly 9.5 million shares, First Eagle Investment Management was the company’s leading stakeholder in Q3.
6. VICI Properties Inc. (NYSE:VICI)
Number of Hedge Fund Holders: 35
Share Price as of the Close of December 20: $28.79
VICI Properties Inc. (NYSE:VICI) ranks sixth on our list of the best dividend stocks under $50. The real estate investment trust company owns casinos and entertainment properties across the US and Canada. The company maintains a robust balance sheet, finishing Q3 2024 with $355.7 million in cash and cash equivalents. This solid cash position has supported the company in increasing its dividend payouts for seven straight years, with a compound annual growth rate (CAGR) of 7% since its IPO. In the latest quarter, the company distributed around $453 million in dividends. It currently pays a quarterly dividend of $0.4325 per share and has a dividend yield of 5.97%, as of December 23.
In Q3 2024, VICI Properties Inc. (NYSE:VICI) reported revenue of $964.6 million, a 6.7% increase compared to the previous year. Net income attributable to common stockholders grew by 31.7% year-over-year, reaching $732.9 million, with a per-share increase of 27.4%, totaling $0.70. AFFO attributable to common stockholders rose by 8.4% to $593.9 million, and on a per-share basis, it increased by 4.9% to $0.57.
In addition to its strong earnings and consistent dividend history, VICI Properties Inc. (NYSE:VICI) has attracted investor attention due to its business model. While its heavy dependence on the gaming sector may seem risky, casinos tend to be resilient during recessions. The company secures tenants with long-term contracts, and the strict regulations in the gaming industry create a protective barrier, making it challenging for tenants to relocate their operations. This approach has allowed Vici to maintain a 100% occupancy rate since its IPO in 2018, even amidst the disruptions caused by the COVID-19 pandemic in the travel, hospitality, and casino industries. Furthermore, most of the company’s long-term leases are linked to the consumer price index (CPI), enabling it to adjust rents regularly in line with inflation.
According to Insider Monkey’s database of Q3 2024, 35 hedge funds held stakes in VICI Properties Inc. (NYSE:VICI), up from 33 in the previous quarter. The consolidated value of these stakes is over $787.6 million. Among these hedge funds, Ken Griffin’s Citadel Investment Group was the company’s leading stakeholder in Q3.
5. Kinder Morgan, Inc. (NYSE:KMI)
Number of Hedge Fund Holders: 42
Share Price as of the Close of December 20: $26.85
Kinder Morgan, Inc. (NYSE:KMI) is one of the largest energy infrastructure companies in North America, which owns and operates oil and gas pipelines and terminals. The stock is generating strong returns this year, surging by nearly 52% since the start of 2024. A key factor behind this growth is the increasing demand, which is filling up capacity on its existing pipelines and leading to higher contract renewal rates. Additionally, the company is benefiting from the positive effects of high-return expansion projects and its $1.8 billion acquisition of STX Midstream last year.
Kinder Morgan, Inc. (NYSE:KMI)’s Tennessee Gas Pipeline subsidiary has announced plans to move forward with the Mississippi Crossing Project (MSX Project), which is expected to begin commercial operations in November 2028, contingent on obtaining the necessary permits. The company plans to invest $1.4 billion in the initial phase of the project. In addition, it is in discussions with customers to potentially add up to 0.4 billion cubic feet per day of extra capacity, which would require further investment to expand the pipeline’s horsepower to accommodate the additional gas. The MSX Project aims to boost natural gas supplies to markets in the Southeast, helping to meet rising demand in the region while lowering energy costs.
Kinder Morgan, Inc. (NYSE:KMI) demonstrated a strong cash position in the third quarter of 2024. The company ended the quarter with $108 million available in cash and cash equivalents, up from $83 million at the end of December 2023. Moreover, it generated $1.2 billion in operating cash flow and its free cash flow amounted to $0.6 billion. On October 16, the company declared a quarterly dividend of $0.2875 per share, which was consistent with its previous dividend. Overall, it has raised its dividends for seven years running, which makes it one of the best dividend stocks under $50. The stock has a dividend yield of 4.25%, as of December 23.
Kinder Morgan, Inc. (NYSE:KMI) was included in 42 hedge fund portfolios at the end of Q3 2024, up from 41 in the previous quarter, as per Insider Monkey’s database. The stakes held by these funds have a total value of nearly $1.3 billion. With over 18.2 million shares, Orbis Investment Management was the company’s leading stakeholder in Q3.
4. Verizon Communications Inc. (NYSE:VZ)
Number of Hedge Fund Holders: 56
Share Price as of the Close of December 20: $39.93
Verizon Communications Inc. (NYSE:VZ) is a New York-based telecommunications company that offers services in communications, technology, information, and entertainment. The company has successfully expanded its customer base despite intense competition. In the third quarter of 2024, it reported 239,000 net additions to its retail postpaid phone customers—more than double the figure from the same period last year. Consequently, total wireless service revenue rose to $19.8 billion, reflecting a 2.7% year-over-year increase.
This growth extends beyond the Wireless segment. The Broadband segment also added 389,000 broadband connections, marking the ninth consecutive quarter with over 375,000 net additions. Verizon Communications Inc. (NYSE:VZ) has been focusing on enhancing its fiber network to deliver superior broadband and mobility services. As part of this effort, the company announced on September 5 a $20 billion strategic acquisition of Frontier Communications, the largest fiber-focused provider in the U.S. This move will boost its fiber customer base to around 25 million, with a target to reach 30 million customers by 2028 and a long-term goal of 35 to 40 million subscribers.
Verizon Communications Inc. (NYSE:VZ) maintains a strong financial foundation, reinforcing its status as a reliable provider of dividends. Over the first nine months of the year, the company reported $26.5 billion in operating cash flow and $14.5 billion in free cash flow. With a track record of 18 consecutive years of dividend growth, Verizon continues to prioritize rewarding its shareholders. The company currently pays a quarterly dividend of $0.6775 per share and has a dividend yield of 6.81%, as of December 23. It is among the best dividend stocks under $50.
Insider Monkey’s database of 900 hedge funds indicated that 57 funds held stakes in Verizon Communications Inc. (NYSE:VZ) in Q3 2024, compared with 67 in the previous quarter. These stakes have a total value of over $3.2 billion. Among these hedge funds, GQG Partners was the company’s leading stakeholder in Q3.
3. AT&T Inc. (NYSE:T)
Number of Hedge Fund Holders: 59
Share Price as of the Close of December 20: $22.75
AT&T Inc. (NYSE:T) ranks third on our list of the best dividend stocks under $50. The American telecommunications company places a strong emphasis on investing in digital infrastructure, with a focus on its mid-band 5G network, which now serves over 210 million people. This dedication to cutting-edge technology strengthens its competitive edge and improves service reliability. In addition, the company has been tackling social challenges by striving to bridge the digital divide and providing affordable broadband options to underserved communities. The stock has surged by over 33% since the start of 2024.
In 2022, AT&T Inc. (NYSE:T) shifted its focus by merging its WarnerMedia division with Discovery, moving away from media to concentrate on bolstering its telecom business. Under the leadership of CEO John Stankey, who took charge in 2020, the company has made significant strides in restructuring and reducing its long-term debt, setting the stage for long-term, sustainable growth.
In the third quarter of 2024, AT&T Inc. (NYSE:T) reported revenue of $30.2 billion, marking a slight decline of 0.5% compared to the same period last year. Despite facing challenges like severe weather and a workforce stoppage in the Southeast, the company achieved its 19th consecutive quarter of adding over 200,000 new AT&T Fiber customers. It continues to grow its largest segment, Mobility and expects to lead the industry in postpaid phone churn for the 13th time in the past 15 quarters. The company remains focused on making strong industry investments, reducing debt, and increasing free cash flow year-to-date.
AT&T Inc. (NYSE:T) showcased a solid cash position in its latest quarterly earnings report. The company generated $10.2 billion in operating cash flow and $5.1 billion in free cash flow. It declared a quarterly dividend of $0.2775 per share and has a dividend yield of 4.84%, as of December 23.
2. Pfizer Inc. (NYSE:PFE)
Number of Hedge Fund Holders: 80
Share Price as of the Close of December 20: $26.36
Pfizer Inc. (NYSE:PFE) is an American pharmaceutical industry company that specializes in a wide range of medications and vaccines. The company is attracting investor attention as management reaffirmed its annual revenue and earnings forecast from October and provided guidance for the upcoming year. Following the company’s latest guidance update, BMO Capital analyst Evan Seigerman maintained an Outperform rating and set a $36 per-share price target. If Pfizer’s stock hits Seigerman’s target, investors purchasing at current prices could see a potential 37% return on their investment in the coming year.
In the third quarter of 2024, Pfizer Inc. (NYSE:PFE) reported $17.7 billion in revenue, reflecting a strong 32% increase compared to the same period last year. Its Oncology portfolio performed robustly, with notable contributions from products such as Padcev, Xtandi, Lorbrena, and Braftovi/Mektovi. Additionally, the company effectively met the increased demand for Paxlovid during the recent spike in COVID-19 cases.
Pfizer Inc. (NYSE:PFE) continues to maintain strong financial stability, supported by a solid cash position. In the first nine months of 2024, the company returned $7.1 billion to shareholders in the form of dividends. On December 13, the company announced a 2.4% hike in its quarterly dividend to $0.43 per share. This marked the company’s 15th consecutive year of dividend growth, which makes PFE one of the best dividend stocks under $50. The stock supports a dividend yield of 6.43%, as of December 23.
Parnassus Investments highlighted Pfizer Inc. (NYSE:PFE) in its Q1 2024 investor letter. Here is what the firm has to say:
“During the quarter, we added new positions in Pfizer Inc. (NYSE:PFE), NICE and Charter Communications. We purchased Pfizer to capture the potential upside from any turnaround following the COVID-induced boom-bust cycle of the last few years. Pfizer’s stock price sank by more than 40% in 2023 as COVID-19 vaccine revenues rolled off, providing an attractive entry point for us. The company completed its acquisition of Seagen, which should strengthen Pfizer’s pipeline in antibody-drug conjugates (ADC). Pfizer also offers an attractive dividend yield.”
According to Insider Monkey’s database, 80 hedge funds held stakes in Pfizer Inc. (NYSE:PFE) at the end of Q3 2024, down from 84 in the previous quarter. The collective value of these stakes is more than $3 billion. With nearly 17 million shares, Two Sigma Advisors was the company’s leading stakeholder in Q3.
1. Bank of America Corporation (NYSE:BAC)
Number of Hedge Fund Holders: 98
Share Price as of the Close of December 20: $44.17
Bank of America Corporation (NYSE:BAC) is a North Carolina-based financial services company and an investment bank. Recent interest rate hikes have had mixed effects on the bank. On the positive side, net interest income rose to $56.9 billion, a 33% increase over the two years ending in 2023. However, the bank has also faced a significant rise in unrealized losses in its loan portfolio, which grew from $14 billion in 2021 to $102 billion last year.
This was also highlighted by Diamond Hill Capital in its Q2 2024 investor letter. Here is what the firm has to say:
“Other top contributors in Q2 included Bank of America Corporation (NYSE:BAC) and Extra Space Storage. Shares of financial services company Bank of America rose in the quarter as it looks increasingly likely net interest income will inflect and begin growing again in 2024’s back half and into 2025.”
Bank of America Corporation (NYSE:BAC) enjoys strong competitive advantages that reinforce its position in the industry, protecting it from both traditional competitors and emerging fintech companies. Its extensive distribution network, combining a robust digital presence with a wide-reaching branch system, enables the bank to expand its low-cost deposit base and attract new customers, generating additional revenue opportunities. In addition, the bank’s large scale allows it to effectively manage its costs, ensuring consistent profitability. The strength of the company brand also appeals to both existing and potential customers. The stock has surged by nearly 31% in 2024 so far.
Bank of America Corporation (NYSE:BAC) is one of the best dividend stocks on our list as the company has never missed a dividend in 26 years. Currently, it pays a quarterly dividend of $0.26 per share and has a dividend yield of 2.34%, as of December 23. Warren Buffett’s Berkshire Hathaway was the company’s leading stakeholder in Q3.
Overall, Bank of America Corporation (NYSE:BAC) ranks first on our list of the best dividend stocks under $50. While we acknowledge the potential for BAC to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than BAC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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