5 Best Fortune 500 Dividend Stocks to Buy Now

3. Devon Energy Corporation (NYSE:DVN)

Number of Hedge Fund Holders: 57   

Dividend Yield as of October 18: 6.68% 

Devon Energy Corporation (NYSE:DVN) is an independent energy company that primarily engages in the exploration, development, and production of oil, natural gas, and natural gas liquids. It is one of the premier large cap stocks to invest in. On September 5, Devon Energy said that it has partnered up with export infrastructure development company, Delfin Midstream, for long term liquefied natural gas export. The agreement provides Devon up to 2 million tons per annum of total liquefaction capacity. 

On September 21, Citi analyst Scott Gruber maintained a Buy rating on Devon Energy Corporation (NYSE:DVN) stock and raised the price target to $77 from $62, noting that the exploration and production companies have “bounced modestly, leading to material 2023 multiple expansion and yield compression”.

At the end of the second quarter of 2022, 57 hedge funds in the database of Insider Monkey held stakes worth $1.5 billion in Devon Energy Corporation (NYSE:DVN), compared to 66 in the previous quarter worth $1.9 billion.

In its Q2 2022 investor letter, GoodHeaven Capital Management, an asset management firm, highlighted a few stocks and Devon Energy Corporation (NYSE:DVN) was one of them. Here is what the fund said:

“Our biggest dollar gainer within this period was Devon Energy Corporation (NYSE:DVN), a position which emanated from a takeover in early 2021 of our long time holding WPX Energy. We are sitting on a material (unrealized) gain from our cost and are now receiving material dividends thanks to Devon’s thoughtful fixed/variable dividend policy. Energy is now a hot sector for investors but we have had a material exposure for a long time. We remember a bit too well $40 oil, NEGATIVELY PRICED front-month oil contract, and what it’s like to own a company with leverage and negative free cash flow during such periods. Our desire to have our biggest portfolio exposures be high return, growing, reasonably predictable and moderately levered companies lead us to reduce our Devon exposure in the past. When the recent facts and circumstances for the industry changed and appeared supportive of healthy oil prices, we decided to maintain a sizable holding and more recently added to the position. At Devon’s Q1 dividend rate, which is mostly variable in nature, the shares now yield approximately 10% and our yield on our average cost is materially higher. In addition, we maintain additional energy exposure through our long-term (and successful) holding in Hess Midstream and less directly through TerraVest and Berkshire Hathaway’s energy investments.”