In this article, we discuss 5 dividend stocks to buy according to Bryan Hinmon’s Motley Fool Asset Management. If you want to read our detailed analysis of the hedge fund’s past performance and its recent developments, go directly to read 10 Dividend Stocks to Buy According to Bryan Hinmon’s Motley Fool Asset Management.
5. Equinix, Inc. (NASDAQ:EQIX)
Motley Fool Asset Management’s Stake Value: $15,576,000
Dividend Yield as of June 17: 1.96%
Number of Hedge Fund Holders: 40
Equinix, Inc. (NASDAQ:EQIX) is an American real estate investment trust that specializes in internet connection and data centers. In May, the company announced the expansion of its operations in Latin America with the acquisition of four data centers in Chile and one additional data center in Peru. The enterprise value for these five data centers is over $735 million.
On April 27, Equinix, Inc. (NASDAQ:EQIX) announced a quarterly dividend of $3.10 per share, with a dividend yield of 1.96%, recorded on June 17. The company raised its quarterly dividend in February this year by 8%. BMO Capital mentioned Equinix, Inc. (NASDAQ:EQIX) in its May investors’ note, raising concerns about the company’s pricing power and the competitive environment. The firm lowered its price target on the stock to $770, with a Market Perform rating on the shares.
At the end of Q1 2022, Motley Fool owned 21,003 shares in Equinix, Inc. (NASDAQ:EQIX), valued at nearly $15.6 million. The company represented 1.14% of Bryan Hinmon’s portfolio.
At the end of March 2022, 40 hedge funds in Insider Monkey’s database owned stakes in Equinix, Inc. (NASDAQ:EQIX), down from 45 in the previous quarter. The collective value of these stakes is over $1.2 billion.
4. Costco Wholesale Corporation (NASDAQ:COST)
Motley Fool Asset Management’s Stake Value: $19,278,000
Dividend Yield as of June 17: 0.81%
Number of Hedge Fund Holders: 61
Costco Wholesale Corporation (NASDAQ:COST) is a Washington-based wholesale retailer that sells discounted goods through membership warehouses and also operates online. In May, the company reported a 15.5% year-over-year increase in its comparable-store sales due to the growth in its core domestic markets. Moreover, the company’s net sales for the month stood at $18.23 billion.
For the quarter ending March 2022, 61 hedge funds invested in Costco Wholesale Corporation (NASDAQ:COST), up from 57 in the previous quarter. The collective value of these stakes is over $5.4 billion. Fisher Asset Management owned the largest stake in the company in Q1, worth over $2.4 billion.
During Q1 2022, Motley Fool reduced its stake in Costco Wholesale Corporation (NASDAQ:COST) by 3%, owning shares worth over $19.2 million. The company accounted for 1.41% of Bryan Hinmon’s portfolio. On April 13, Costco Wholesale Corporation (NASDAQ:COST) announced a 13.9% increase in its quarterly dividend to $0.90 per share. This was the company’s 18th year of consistent dividend growth. The stock’s yield was recorded at 0.81% on June 17.
In June, Costco Wholesale Corporation (NASDAQ:COST) surveyed over 900 warehouse club members about renewal intentions and shopping behaviors, and the positive results of the survey showed growth in the company’s success post-pandemic. In view of this, Jefferies raised its price target on the stock to $580 in June while keeping a Buy rating on the shares.
ClearBridge Investments mentioned Costco Wholesale Corporation (NASDAQ:COST) in its Q4 2021 investor letter. Here is what the firm has to say:
“Portfolio gains were led by a diverse group of contributors. Also in consumer discretionary, Costco, which operates a chain of membership-only big-box retail stores, continues to impress as it takes to share and becomes more relevant for the consumer even as the world opens up.”
3. Medtronic plc (NYSE:MDT)
Motley Fool Asset Management’s Stake Value: $21,349,000
Dividend Yield as of June 17: 3.08%
Number of Hedge Fund Holders: 54
Medtronic plc (NYSE:MDT) is an Ireland-based medical device company that is known widely for its therapies and cardiac devices. In fiscal Q4 2022, the company missed estimates on various accounts but expects its organic revenue growth in the range of 4% to 5% in FY23. In 2022, the company saw a 5% year-over-year growth in its organic revenue.
In May 2022, Medtronic plc (NYSE:MDT) announced an 8% hike in its quarterly dividend, which marked the company’s 45th consecutive year of dividend growth. The company’s quarterly payout stands at $0.68 per share, with a dividend yield of 3.08%, as of June 17. In May, Raymond James noted the negative impact of supply chain issues on Medtronic plc (NYSE:MDT)’s revenue and lowered its price target on the stock to $109, but kept an Outperform rating on the shares.
According to Insider Monkey’s Q1 2022 database, 54 hedge funds owned stakes in Medtronic plc (NYSE:MDT), falling from 55 in the previous quarter. The combined value of these stakes is roughly $2 billion.
Motley Fool renewed its position in Medtronic plc (NYSE:MDT) during the second quarter of 2021, after dumping off its entire stake in the company twice since 2015. At the end of Q1 2022, the hedge fund owned 192,422 MDT shares, valued at over $21.3 million. The company made up 1.56% of Bryan Hinmon’s portfolio.
Polen Capital mentioned Medtronic plc (NYSE:MDT) in its Q1 2022 investor letter. Here is what the firm has to say:
“Ireland-based Medtronic is a leading health care company focused on supplying many important life-saving devices like pacemakers, defibrillators, and insulin pumps. This is another company with attractive pricing power and a business model that can hold up well during inflationary periods. Medtronic has increased market share across almost 70% of its portfolio since the start of the pandemic, which is a higher percentage than even before the pandemic. With growth-oriented companies falling out of favor over the quarter, the stock’s relatively discounted valuation (at approximately 19x earnings) also bolstered its performance.”
2. Fastenal Company (NASDAQ:FAST)
Motley Fool Asset Management’s Stake Value: $24,748,000
Dividend Yield as of June 17: 2.56%
Number of Hedge Fund Holders: 29
Fastenal Company (NASDAQ:FAST) is an American company that provides supply chain management solutions to its consumers. The company saw a 23.5% year-over-year sales growth in May at $589.2 million, supported by solid growth in the North American region. In addition to this, the company’s Q1 revenue came in at $1.7 billion, up 20.3% from the same period last year.
Fastenal Company (NASDAQ:FAST) has a long history of dividend payments. The company started paying annual dividends in 1991 and expanded to quarterly dividends in 2011. Moreover, it also paid special dividends to shareholders in 2008, 2012, and 2020. Currently, the company offers a quarterly payout of $0.31 per share, with a yield of 2.56%, recorded on June 17. At the end of Q1 2022, Motley Fool’s investment in Fastenal Company (NASDAQ:FAST) amounted to $24.7 million. The hedge fund brought its position down in the company by 6% during the quarter. The company made up 1.81% of Bryan Hinmon’s portfolio.
The number of hedge funds tracked by Insider Monkey owning stakes in Fastenal Company (NASDAQ:FAST) stood at 29, the same as in the previous quarter. The collective value of these stakes is over $1.04 billion, up from $941 million worth of stakes held by hedge funds in Q4 2021. Jack Woodruff, Cliff Asness, and Ken Griffin were some of the company’s major stakeholders in Q1.
Nomadic Value Partners mentioned Fastenal Company (NASDAQ:FAST) in its Q2 2021 investor letter. Here is what the firm has to say:
“In mid-June we completely sold out of Fastenal (FAST). Although we had been using FAST as a source of liquidity for a few months already, it still feels bad to say an official goodbye to such an amazing company. However, we must stay focused on the math and the math concludes a difficult task to get our return hurdle going forward. The last time FAST traded at a forward P/E ratio of 34x (the multiple at our exit), the year was 2012. The company had been growing at 20% per year, and the US was about to embark on a shale oil boom, sustaining a low-teens growth trajectory. Today, FAST’s sales growth could turn anemic as the surge for COVID safety products is waning and heavy construction and resources customers are slow to return. An investor must have an optimistic view towards 5+ years of strong real GDP growth as well as sustained inflation. If one lowers the growth assumption to a more likely outcome, then the implicit bet is that low to negative real interest rates will persist and the forward P/E multiple will stay elevated4. I do not want to make such a strong macro bet as the justification for owning a stock. Fastenal is a cyclical business with a growth model proven to take market share secularly, but the time to buy FAST (the stock) will be when we are in the depths of an industrial recession. Stay tuned.”
1. Watsco, Inc. (NYSE:WSO)
Motley Fool Asset Management’s Stake Value: $51,271,000
Dividend Yield as of June 17: 3.87%
Number of Hedge Fund Holders: 22
Watsco, Inc. (NYSE:WSO) is a Miami-based largest distributor of air conditioning, heating, and refrigeration equipment. In Q1 2022, the company posted a 25% year-over-year growth in its same-store sales, while its gross revenue came in at $1.52 billion, which beat estimates by $130 million.
In April 2022, Watsco, Inc. (NYSE:WSO) announced a 13% hike in its quarterly dividend to $2.20 per share. The company has been paying uninterrupted dividends to shareholders for the past 48 years. The stock’s dividend yield came in at 3.87% on June 17. Recognizing the company’s internal parts initiatives and higher efficiency sales, Baird raised its price target on Watsco, Inc. (NYSE:WSO) to $350 in April, while maintaining a Neutral rating on the shares.
At the end of Q1 2022, Watsco, Inc. (NYSE:WSO) was the fifth-largest holding of Motley Fool, as the hedge fund owned stakes worth over $51.2 million in the company. It accounted for 3.75% of Bryan Hinmon’s portfolio.
At the end of March 2022, Watsco, Inc. (NYSE:WSO) saw a reduction in the hedge fund positions, as 22 elite funds tracked by Insider Monkey owned stakes in the company, down from 31 in the previous quarter. The consolidated value of these stakes is over $334.3 million. Renaissance Technologies was one of the company’s most prominent shareholders in Q1.
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