In this article, we discuss the 5 dividend stocks to buy according to Donald Yacktman’s hedge fund. If you want to read our detailed analysis of Yacktman’s investment career and his hedge fund, go directly to read 10 Dividend Stocks to Buy According to Donald Yacktman’s Hedge Fund.
5. Canadian Natural Resources Limited (NYSE:CNQ)
Number of Hedge Fund Holders: 27
Dividend Yield: 4.47%
Canadian Natural Resources Limited (NYSE:CNQ) is a Canadian company that is engaged in the exploration of hydrocarbon.
Canadian Natural Resources Limited (NYSE:CNQ) gained 65% in 2021, while its 12-month return came in at 77.02%. In November, TD Securities raised its price target on the stock to C$61, while keeping a Buy rating on the shares. Canadian Natural Resources Limited (NYSE:CNQ), one of the best dividend stocks to buy according to Donald Yacktman’s hedge fund, pays an annual dividend of $1.49 per share. The stock’s current dividend yield stands at 4.47%.
Yacktman Asset Management was the largest shareholder of Canadian Natural Resources Limited (NYSE:CNQ) in Q3, owning shares worth $608 million. Overall, 27 hedge funds tracked by Insider Monkey reported owning stakes in the company in Q3, the same as in the previous quarter. The total value of these stakes is over $777 million, compared with $528.8 million in Q1.
4. Philip Morris International Inc. (NYSE:PM)
Number of Hedge Fund Holders: 48
Dividend Yield: 5.51%
Philip Morris International Inc. (NYSE:PM), a multinational cigarette and tobacco manufacturing company, pays an annual dividend of $5.00 per share, with a dividend yield of 5.51%. The company has been increasing its dividend for the past 13 years, making it one of the best dividend stocks to buy according to Donald Yacktman’s hedge fund.
At the end of Q3 2021, 48 hedge funds tracked by Insider Monkey were bullish on Philip Morris International Inc. (NYSE:PM), compared with 46 in the previous quarter. The total value of these stakes is roughly $6 billion.
Philip Morris International Inc. (NYSE:PM) announced its Q3 results on October 19 and posted an EPS of $1.58, beating the consensus by $0.02. The company showed confidence in its growth targets set for 2021 to 2023, despite device constraints that could continue in the first half of 2022. In the past year, Philip Morris International Inc. (NYSE:PM) delivered an 18.2% return to shareholders.
3. Exxon Mobil Corporation (NYSE:XOM)
Number of Hedge Fund Holders: 64
Dividend Yield: 5.75%
This October, Morgan Stanley presented a positive outlook on Exxon Mobil Corporation (NYSE:XOM), an American oil and gas company, as the exploration and production sector is strengthening post-Covid. The firm lifted its price target on the stock to $84, while keeping an Overweight rating on the shares.
Exxon Mobil Corporation (NYSE:XOM) pays an annual dividend of $3.52 per share. The stock’s current dividend yield stands at 5.75%. As of Q3, the company represents 0.13% of Yacktman Asset Management’s 13F portfolio. After hitting an all-time low of $32.7 per share, the stock has bounced back, gaining 56.4% in the past year and 48.3% in 2021.
Of the 867 hedge funds tracked by Insider Monkey, 64 hedge funds held positions in Exxon Mobil Corporation (NYSE:XOM) in Q3, with stakes valued at $4.6 billion. In the previous quarter, 67 hedge funds had stakes in the company, valued at $3.7 billion.
First Eagle Investment Management mentioned Exxon Mobil Corporation (NYSE:XOM) in its Q2 2021 investor letter. Here is what the firm has to say:
“Leading contributors in the First Eagle Global Fund this quarter included Exxon Mobil Corporation. The continued recovery in oil prices as economies reopen helped fuel another strong performance across the energy complex, including shares of Exxon Mobil. Exxon Mobil recently lost a proxy fight with an activist investor that took three of the company’s 12 board seats. While the press was focused on the investor’s concerns over Exxon Mobil’s long term energy transformation strategy, other factors fundamental to shareholder returns—like capital discipline and balance sheet management—were also at play.”
2. Evolution Petroleum Corporation (NYSE:EPM)
Number of Hedge Fund Holders: 10
Dividend Yield: 5.77%
Evolution Petroleum Corporation (NYSE:EPM) develops and produces oil and natural gas reserves within well-known reservoirs.
In its recently released Q3 results, Evolution Petroleum Corporation (NYSE:EPM) posted a GAAP EPS of $0.16, beating the estimates by $0.01. The company’s revenue also experienced a 238% growth from the prior-year quarter at $18.9 million. Evolution Petroleum Corporation (NYSE:EPM), one of the best dividend stocks to buy according to Donald Yacktman’s hedge fund, pays an annual dividend of $0.30 per share. The stock’s dividend yield stands at 5.77%.
Renaissance Technologies was the company’s largest shareholder in Q3, holding over 2 million shares. As of Q3, 10 hedge funds tracked by Insider Monkey reported owning stakes in the Texas-based company, valued at $17.5 million. In the previous quarter, 13hedge funds held stakes in the company, with a value of $17.3 million.
1. Altria Group, Inc. (NYSE:MO)
Number of Hedge Fund Holders: 45
Dividend Yield: 8.16%
Altria Group, Inc. (NYSE:MO), an American tobacco company, remains one of the best dividend stocks to buy according to Donald Yacktman’s hedge fund, as the company has a 13-year track record of consistent dividend growth.
This October, Morgan Stanley set a $47 price target on Altria Group, Inc. (NYSE:MO), with an Equal Weight rating on the shares. The stock has delivered an 8.15% return to shareholders, while its 12-month gains stand at 9.88%.
Among the 867 hedge funds tracked by Insider Monkey, Harris Associates was the largest shareholder of Altria Group, Inc. (NYSE:MO) in Q3, holding a $232.6 million worth of stake. Overall, 45 hedge funds held positions in the company in Q3, down from 47 in the previous quarter. These stakes are valued at $829.7 million.
Broyhill Asset Management mentioned Altria Group Inc (NYSE:MO) in its Q2 2021 investor letter. Here is what the firm has to say:
“Altria (MO) shook off the prospects of a ban on menthol and a potential cap on nicotine and gained 20%. We shared our thoughts on these regulations during the quarter, which are available here.
MO Valuation. MO is up ~ 18% YTD (even accounting for the recent sell-off). We expect MO to generate close to $5 in annual FCF per share over the next few years, putting the stock at ~ 10x, which is less than half the market’s multiple today. Over the last decade, shares have traded at an average multiple of 15x and within a range of ~ 10x – 20x (+/-1 standard deviation). The stock yields 7.2% at the current price, close to a 6% premium to treasuries. Historically, shares have traded closer to a 3% premium to the 10Y, which would imply a ~ $75 share price.”
You can also take a look at 10 Best Dividend Stocks Under $20 and 10 Best Healthcare Dividend Stocks
