5 Extreme Dividend Stocks with Huge Upside

1. Altria Group, Inc. (NYSE:MO)

No of HFs: 47

Total Value of HF Holdings: $1.25 Billion

Altria tops our list of extreme dividend stocks with huge upside. MO is known as the world’s largest producer of tobacco, cigarettes and related products. And owns several largest cigarette companies including Philip Morris and John Middleton. The company ranks 23^rd in the fortune 500. They were mentioned in the Top 10 Sin Stocks to Buy Now and in the 5 Dividend Stocks to Boost Cash Flow in 2021.

The top hedge fund holder of this stock is Jim Simons’ Renaissance Technologies, which had over $352 million invested in the stock at the end of September. An insider purchased 11,500 shares at around $40. The stock was up 2% since then. MO offers a 8.27% dividend yield at the moment.

Check out an article where Artko Capital mentioned that the stock’s low growth was not going to get them the returns they seek.

“Altria Group (MO) – We made an 9% Core Portfolio investment in Altria group at sub $40.00 in 2019 with the view that it was a good place to park cash at an 8%+ dividend yield with liquidity and a 15- 25% annual IRR upside. When the stock reached $50+ in early 2020 we took half of our position off the table and took the rest off back at $40 in the spring 2020 as we are positioning our portfolio to have significantly higher upside in the nanocap space as the economy and the small cap markets recover over the next few years. We may come back to MO in the future as it is a solid dividend yielding investment, but as we mentioned earlier, our strategy does involve off-the-beaten-path companies with an opportunity to get repriced on growth of revenues and earnings and Altria Group’s low growth was not going to get us the returns we seek given the repricing of the value segment of the small cap markets.”

Please also see 15 Best Dividend Stocks with Upside Potential  and 10 Best Dividend Stocks for Passive Income

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