15 Best Stocks For Dividends

1. S&P Global Inc. (NYSE:SPGI)

Number of Hedge Fund Holders: 97

S&P Global Inc. (NYSE:SPGI) is an American capital markets company that offers services in financial information and analytics. The company has established its strong presence in the credit ratings industry and that too, with regulatory requirements and high barriers to entry. In addition, it has maintained a solid reputation and gained investors’ confidence over the years. The company currently holds a dominant position in this sector, leveraging a robust economic moat that guarantees stability and steady cash flows. Its trailing twelve-month (TTM) free cash flow stands at around $4 billion, markedly surpassing its competitor Moody’s, which has a TTM free cash flow of approximately $2 billion.

The credit ratings industry is rebounding from the decline it suffered in 2022. S&P Global Inc. (NYSE:SPGI) completed a $44 billion all-stock acquisition of IHS Markit that year, greatly enhancing its information and analytics capabilities. While this acquisition improved the company’s market footprint, it also affected its return on invested capital. In addition, persistent increases in interest rates during this period added further pressure on the stock price. However, conditions have started to get better. In the first quarter of 2024, the company noted the highest level of debt issuance since 2021. The stock has gained nearly 11% since the start of 2024 and its 12-month returns came in at 15.6%.

On June 25, S&P Global Inc. (NYSE:SPGI) announced a quarterly dividend of $0.91 per share, which was consistent with its previous dividend. The company has been growing its payouts regularly for the past 51 years, which places it on our list of the best stocks for dividends. The stock’s dividend yield on July 15 came in at 0.75%.

S&P Global Inc. (NYSE:SPGI) remained popular among elite funds in the first quarter of 2024 as hedge fund positions in the company jumped to 97, from 82 in the previous quarter, according to Insider Monkey’s database. The stakes held by these hedge funds have a consolidated value of over $9.5 billion.

While we acknowledge the potential of SPGI as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued dividend stock that is more promising than SPGI but that trades at less than 7 times its earnings and yields nearly 10%, check out our report about the dirt cheap dividend stock.

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Disclosure: None. This article is originally published at Insider Monkey.