In this article, we discuss 13 dividend giants with the lowest short interest. You can skip our detailed analysis of dividend stocks and their previous performance, and go directly to read 5 Dividend Giants with Lowest Short Interest.
While the financial world is typically viewed as serious and analytical, the art of short selling adds a dash of excitement and complexity to the market narrative. Short interest refers to the total number of shares of a particular stock that have been sold short by investors but have not yet been covered or closed out. In a short sale, an investor borrows shares of a stock from a broker and sells them on the open market with the expectation that the stock’s price will fall. The investor aims to buy back the shares at a lower price, return them to the lender, and profit from the difference. Short selling is not for the faint of heart. The potential for unlimited losses and the obligation to buy back shares at an unpredictable future price make this strategy inherently risky.
Also read: 15 Stocks with Lowest Short Interest
The success of short sellers is contingent on a multitude of factors, and it can vary across different market segments and conditions. In 2023, short sellers are making profits by betting against small-cap stocks. Short sellers have reportedly earned paper profits of almost $13 billion in the current year by betting on a decline in the prices of small-, micro-, and nano-cap shares. This estimate, provided by S3 Partners LLC, is based on the average amount of short positions in the market. Interestingly, this contrasts sharply with the approximately $140 billion in losses resulting from short sales of mid-, mega-, and large-cap stocks. The latter category experienced a rally for a significant portion of the year, defying gloomy economic forecasts.
At the beginning of 2023, the banking sector encountered challenges, and short sellers capitalized on the upheaval. Hedge funds that bet against bank stocks amassed unrealized gains totaling $7.25 billion throughout the month, as reported by Ortex. Peter Hillerberg, the company’s co-founder further said:
“ORTEX data shows that March was the single most profitable month for short sellers in the banking sector since the 2008 financial crash.”
As mentioned before, engaging in short selling involves numerous risks. This becomes particularly true when investors attempt to short a stock that pays dividends as they may be responsible for paying any dividends that the stock distributes during the time they hold the short position. This can add cost to the short seller. Despite the risks associated with short selling, dividends have consistently captivated investors because of their potential to provide steady and reliable returns. In this article, we’ll explore dividend giants that currently have minimal short interest.
Daily newspaper economy stock market chart
Our Methodology:
To create this list, we used the Finviz stock screener to find dividend stocks with a market capitalization of at least $10 billion and dividend yields exceeding 3% as of November 10. We then narrowed down the selection to stocks with less than 6% of their float sold short, using data from Yahoo Finance recorded on October 30. The stocks are arranged in descending order based on their short interest rates.
13. Franklin Resources, Inc. (NYSE:BEN)
Short % of Float as of October 30: 5.47%
Franklin Resources, Inc. (NYSE:BEN) is a global investment management company. The company offers a wide range of investment products, including mutual funds, closed-end funds, and separately managed accounts. On September 6, the company declared a quarterly dividend of $0.60 per share, which was in line with its previous dividend. It has been growing its dividends for the past 47 years. As of November 10, the stock has a dividend yield of 5.22%. It is one of the dividend giants with 5.47% of its float sold short, as recorded on October 30.
At the end of Q2 2023, 19 hedge funds tracked by Insider Monkey reported having stakes in Franklin Resources, Inc. (NYSE:BEN), worth roughly $170 million in total. Among these hedge funds, Balyasny Asset Management was the company’s leading stakeholder in Q2.
12. Hormel Foods Corporation (NYSE:HRL)
Short % of Float as of October 30: 4.50%
Hormel Foods Corporation (NYSE:HRL) is a Minnesota-based multinational food and meat processing company. The company is known for a variety of food products, and it operates in several segments within the food industry. The company offers a quarterly dividend of $0.275 per share for a dividend yield of 3.38%, as of November 10. Its dividend growth streak currently stands at 57 years.
As of October 30, Hormel Foods Corporation (NYSE:HRL) has a short interest representing 4.50% of the total number of shares available for trading in the market. This makes it one of the dividend giants with the lowest short interest on our list.
As of the close of Q2 2023, 24 hedge funds in Insider Monkey’s database owned stakes in Hormel Foods Corporation (NYSE:HRL), compared with 30 in the previous quarter. The consolidated value of these stakes is more than %267.2 million.
11. The Clorox Company (NYSE:CLX)
Short % of Float as of October 30: 3.43%
The Clorox Company (NYSE:CLX) is a multinational consumer goods company that specializes in the manufacturing and marketing of various household and professional products. On September 21, the company declared a quarterly dividend of $1.20 per share, which was consistent with its previous dividend. In 2023, the company stretched its dividend growth streak to 20 years. The stock’s dividend yield on November 10 came in at 3.63%.
Insider Monkey’s database of Q2 2023 indicated that 34 hedge funds owned stakes in The Clorox Company (NYSE:CLX), down from 38 in the preceding quarter. These stakes are collectively valued at over $847 million. With roughly 1 million shares, Two Sigma Advisors was the company’s leading stakeholder in Q2.
10. The Kraft Heinz Company (NASDAQ:KHC)
Short % of Float as of October 30: 2.28%
The Kraft Heinz Company (NASDAQ:KHC) is one of the world’s largest food and beverage companies, formed by the merger of Kraft Foods Group and H.J. Heinz Company. The company reported a strong cash position in FY23 with its operating cash flow jumping 72.8% on a year-over-year basis to $2.6 billion. Year-to-date, its free cash flow amounted to $1.8 billion, up 102% from the same period last year.
The Kraft Heinz Company (NASDAQ:KHC) has been paying regular dividends to shareholders since its merger in 2015. The company currently pays a quarterly dividend of $0.40 per share and has a dividend yield of 4.86%, as of November 10. It is among the dividend giants on our list with 2.28% with 2.28% of its available shares being sold short.
The number of hedge funds in Insider Monkey’s database owning stakes in The Kraft Heinz Company (NASDAQ:KHC) grew to 39 in Q2 2023, from 34 in the preceding quarter. These stakes have an overall value of more than $12.2 billion.
9. Consolidated Edison, Inc. (NYSE:ED)
Short % of Float as of October 30: 2.25%
Consolidated Edison, Inc. (NYSE:ED) is another dividend giant on our list with the lowest short interest. The American utility company primarily focuses on providing energy-related services. The company currently offers a quarterly dividend of $0.81 per share and has a dividend yield of 3.63%, as of November 10. It is just one year away from becoming a Dividend King, maintaining a 49-year streak of consistent dividend growth.
At the end of the June quarter of 2023, 30 hedge funds tracked by Insider Monkey, up from 27 in the previous quarter, held stakes in Consolidated Edison, Inc. (NYSE:ED). These stakes are collectively worth over $302.3 million. AQR Capital Management was the company’s largest stakeholder in Q2.
8. Kimberly-Clark Corporation (NYSE:KMB)
Short % of Float as of October 30: 1.59%
Kimberly-Clark Corporation (NYSE:KMB) is a multinational consumer goods company that specializes in the manufacturing and marketing of a variety of products, primarily in the personal care and hygiene, tissue, and professional products segments.
Kimberly-Clark Corporation (NYSE:KMB), one of the best dividend giants on our list, has been growing its dividends for 51 years in a row. The company offers a quarterly dividend of $1.18 per share and has a dividend yield of 3.93%, as of November 10.
At the end of June 2023, 38 hedge funds in Insider Monkey’s database owned stakes in Kimberly-Clark Corporation (NYSE:KMB), down from 40 a quarter earlier. These stakes have a collective value of over $817.5 million.
7. Amgen Inc. (NASDAQ:AMGN)
Short % of Float as of October 30: 1.20%
Amgen Inc. (NASDAQ:AMGN) is a multinational biopharmaceutical company that focuses on the discovery, development, and manufacturing of innovative therapies for patients suffering from serious illnesses. The company has a 10-year run of growing its dividends and it currently pays a quarterly dividend of $2.13 per share. The stock has a dividend yield of 3.23%, as of November 10.
At the end of Q2 2023, 57 hedge funds tracked by Insider Monkey owned stakes in Amgen Inc. (NASDAQ:AMGN), the same as in the previous quarter. The total value of these stakes is over $1.56 billion.
Aristotle Capital Management, LLC mentioned Amgen Inc. (NASDAQ:AMGN) in its Q3 2023 investor letter. Here is what the firm has to say:
“Amgen Inc. (NASDAQ:AMGN), the biopharmaceutical company, was the top contributor for the quarter. The company continues to leverage its innovative platform to strengthen its product portfolio, offset maturing products, such as Epogen and Neulasta, and increase market share. Over the past year, Amgen has reported double‐digit volume growth, operating margin expansion to over 40% and record levels of sales for cholesterol drug Repatha, bone‐strengthening drug Prolia and cancer drug Blincyto. Additionally, the company remains well positioned to benefit from the continued development and commercialization of biosimilars such as Amgevita, the first biosimilar to Humira, and the successful integration of Otezla to bolster its inflammation segment. Lastly, the FTC agreed to allow Amgen to proceed with its $27.8 billion acquisition of Horizon Therapeutics. We note that this is yet another unsuccessful attempt by the FTC to block an M&A transaction of one of our holdings (see below re: Activision Blizzard). The transaction closed on October 6, 2023 and brings expertise in rare disease therapies (including bulging eye‐drug Tepezza), as well as adds to Amgen’s immunology portfolio.”
6. Bristol-Myers Squibb Company (NYSE:BMY)
Short % of Float as of October 30: 1.15%
Bristol-Myers Squibb Company (NYSE:BMY) is an American multinational biopharmaceutical company that engages in the discovery, development, and commercialization of innovative medicines for the treatment of various diseases. The company offers a quarterly dividend of $0.57 per share and has a dividend yield of 4.52%, as of November 10. It has been growing its dividends consistently for the past 17 years. With 1.15% of its float sold short, BMY is one of the dividend giants with the lowest short interest.
The number of hedge funds tracked by Insider Monkey owning stakes in Bristol-Myers Squibb Company (NYSE:BMY) stood at 66 in Q2 2023. The total value of these stakes is roughly $1.7 billion. With over 4.3 million shares, Pzena Investment Management was the company’s leading stakeholder in Q2.
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Disclosure. None. 13 Dividend Giants with Lowest Short Interest is originally published on Insider Monkey.