In this article, we discuss 5 high-yield dividend stocks to buy according to John A. Levin’s Levin Capital. If you want to read our detailed analysis of Levin’s hedge fund and its past performance, go directly to read 10 High-Yield Dividend Stocks to Buy According to John A. Levin’s Levin Capital.
5. International Paper Company (NYSE:IP)
Dividend Yield as of June 20: 4.37%
Number of Hedge Fund Holders: 27
Levin Capital Strategies’ Stake Value: $4,052,000
International Paper Company (NYSE:IP) is an American paper company that specializes in filter-based packaging and pulp. The company transforms renewable resources into everyday products. In Q1 2022, the company reported strong results, posting an EPS of $0.76, which beat estimates by $0.20. The company’s revenue for the quarter stood at $5.2 billion, showing a 14.2% year-over-year growth and exceeding the consensus by $280 million.
In October 2021, International Paper Company (NYSE:IP) slashed its quarterly dividend by 10% as it started making some business adjustments. Currently, the company offers a quarterly dividend of $0.4625 per share, with a dividend yield of 4.37%, as of June 20.
During Q1 2022, Levin Capital purchased additional IP shares worth over $3 million, boosting its position in the company by 300%. The hedge fund owned a stake worth over $4.05 million in the company in Q1, which represented 0.39% of John A. Levin’s portfolio. In April, Deutsche Bank lifted its price target on International Paper Company (NYSE:IP) to $48 but kept a Hold rating on the shares, raising concerns about weaker consumer sentiment, inflation, and the uncertain geopolitical situation.
At the end of March 2022, 27 hedge funds tracked by Insider Monkey reported owning stakes in International Paper Company (NYSE:IP), declining from 38 in the previous quarter. The collective value of these stakes is over $633.4 million. With roughly 5 million shares worth $230.5 million, Greenhaven Associates owned the largest position in the Tennessee-based company in Q1.
4. The Kraft Heinz Company (NASDAQ:KHC)
Dividend Yield as of June 20: 4.50%
Number of Hedge Fund Holders: 35
Levin Capital Strategies’ Stake Value: $3,981,000
The Kraft Heinz Company (NASDAQ:KHC) is one of the world’s leading food companies that provides high-quality food products to its consumers. At the end of Q1 2022, Levin Capital owned 101,066 shares in the company, valued at nearly $4 million. The hedge fund sold off its entire stake in the company twice since 2015 and resumed its position in 2018 with a comparatively larger stake of over $84.5 million. KHC accounted for 0.38% of John A. Levin’s portfolio in Q1.
In the past month, The Kraft Heinz Company (NASDAQ:KHC) saw a 7.27% drop in its share price due to the commentary on price hikes in the consumer staples sector. However, in June, BofA mentioned that the stock is currently offering an attractive entry point and also that it expects a meaningful upside in its shares in the next 12 months. The firm raised its price target on the stock to $48, with a Buy rating on the shares.
On April 27, The Kraft Heinz Company (NASDAQ:KHC) declared a quarterly dividend of $0.40 per share, with a yield of 4.50%, as recorded on June 20. Though the company cut its dividend by 36% in 2019, it has maintained regular dividend payouts for shareholders over the years.
As of the quarter ended in March 2022, 35 hedge funds in Insider Monkey’s database owned stakes in The Kraft Heinz Company (NASDAQ:KHC), down from 39 in the previous quarter. The collective value of these stakes is over $13.44 billion. Warren Buffett’s Berkshire Hathaway owned the largest position in the company, with stakes valued at roughly $13 billion.
3. International Business Machines Corporation (NYSE:IBM)
Dividend Yield as of June 20: 4.89%
Number of Hedge Fund Holders: 43
Levin Capital Strategies’ Stake Value: $21,215,000
International Business Machines Corporation (NYSE:IBM) is a New York-based technology company that provides a wide range of hardware and software services to consumers. In May, the company signed a strategic agreement with Amazon Web Services that will provide clients with quick and easy access to IBM software.
In Q1 2022, International Business Machines Corporation (NYSE:IBM) reported a 12% year-over-year growth in its software revenue, while its consulting revenue also saw a 17% growth from the same period last year. The company’s gross revenue came in at $14.2 billion, which surpassed market estimates by $360 million.
During Q1 2022, Levin Capital added another 34,601 IBM shares, increasing its position in the company by 27%. The hedge fund’s total stake in the company amounted to over $21.2 million, which represented 2.04% of John A. Levin’s portfolio. International Business Machines Corporation (NYSE:IBM) has paid uninterrupted dividends to shareholders since 1916 and maintains a 27-year track record of dividend growth. Currently, the company pays a quarterly payout of $1.65 per share, with a yield of 4.89%, as of the close of June 20.
At the end of Q1 2022, 43 hedge funds tracked by Insider Monkey presented a bullish stance on International Business Machines Corporation (NYSE:IBM), compared with 44 funds a quarter earlier. These stakes hold a consolidated value of nearly 1.2 billion.
St. James Investment Company mentioned International Business Machines Corporation (NYSE:IBM) in its Q4 2021 investor letter. Here is what the firm has to say:
“IBM was not the first company to build computers. The distinction belongs to Sperry-Rand’s subsidiary UNIVAC, which introduced the first commercially successful computers in the early 1950s. In this era, IBM did possess the largest research and development department of the business machines industry and quickly caught up, introducing cost-competitive computers a few years after UNIVAC. By the late 1950s, IBM held the dominant market share in computers. IBM also touted a vastly superior sales organization, which used a sales tactic called “paper machines” (the equivalent of today’s “vaporware”). If a competitor’s product was selling well in a market segment that IBM had yet to penetrate, the company would announce a competing product and start taking orders for the “paper machine” long before it was available.
One cannot overstate how powerful IBM was in the computer industry in the 1950s and 1960s. Every competitor rightly worried that if their product worked too well for too long, it was only a matter of time before an army of IBM salesforce representatives mobilized. In their easily recognizable uniforms of starched white shirts, red ties and blue suits, IBM marketers marched on their customers and offered a more expensive, but much more defensible, choice. “Nobody gets fired for buying IBM” was a common phrase. Even competitors acknowledged that the company excelled at sales. As a UNIVAC executive once complained, ‘It doesn’t do much good to build a better mousetrap if the other guy selling mousetraps has five times as many salesmen.’” (Click here to see the full text)
2. AT&T Inc. (NYSE:T)
Dividend Yield as of June 20: 5.73%
Number of Hedge Fund Holders: 74
Levin Capital Strategies’ Stake Value: $38,733,000
AT&T Inc. (NYSE:T) is a Texas-based telecommunications company, offering media and tech-related services to its shareholders. At the end of Q1 2022, Levin Capital owned over 1.6 million shares in the company, valued at over $38.7 million. The hedge fund increased its position in the company by 43%, which accounted for 3.73% of John A. Levin’s portfolio.
On June 14, AT&T Inc. (NYSE:T)’s CFO announced to increase prices of some of its mobile plans due to the rising cost pressures. He further mentioned that this price hike will lead to an enhancement in the company’s margins by the end of the year. Earlier in June, Morgan Stanley mentioned that AT&T Inc. (NYSE:T) could see another 20% upside due to its strong balance sheet and lifted its price target on the stock to $27.
AT&T Inc. (NYSE:T) currently offers a quarterly dividend of $0.2775 per share, with a dividend yield of 5.73%, as of June 20. 2021 marked the company’s 23rd consecutive year of dividend growth.
At the end of March 2022, AT&T Inc. (NYSE:T) remained popular among elite funds, as 74 hedge funds tracked by Insider Monkey reported owning stakes in the company, up from 70 in the previous quarter. These stakes hold a total value of more than $4 million. Among these funds, Arrowstreet Capital was the leading stakeholder of the company in Q1.
Weitz Investment Management mentioned AT&T Inc. (NYSE:T) in its Q4 2021 investor letter. Here is what the firm has to say:
“After several quarters of pandemic-induced outsized growth, new broadband connection growth has slowed for U.S. cable operators. This slower growth has coincided with a renewed push by competitors like Verizon and AT&T to offer high-speed data (either via wireless connects or by building new fiber-optic networks).”
1. Vornado Realty Trust (NYSE:VNO)
Dividend Yield as of June 20: 7.45%
Number of Hedge Fund Holders: 24
Levin Capital Strategies’ Stake Value: $7,063,000
Vornado Realty Trust (NYSE:VNO) is an American real estate investment trust that mainly invests in office buildings and other commercial buildings. The company gained traction among investors after its Q1 results, gaining 4.5% on May 2. In Q1 2022, the company reported a 3.1% year-over-year growth in its same-store net operating income. Moreover, its gross revenue came in at $442.1 million, which surpassed estimates by$20.2 million.
As per Insider Monkey’s Q1 2022 database, Vornado Realty Trust (NYSE:VNO) was a part of 24 hedge fund portfolios, up from 22 in the previous quarter. The collective value of these stakes held by hedge funds stood at nearly $200 million.
In 2020, Vornado Realty Trust (NYSE:VNO) cut its quarterly dividend by 20% in recognition of the economic uncertainty caused by the pandemic. Since then, the company has been paying a quarterly dividend of $0.53 per share, with a yield of 7.45%, as of June 20. In its June investors’ note, Truist appreciated the company’s portfolio but also mentioned the stock’s negative year-to-date returns. The firm lowered its price target on Vornado Realty Trust (NYSE:VNO) to $41 but kept a Buy rating on the shares.
During Q1 2022, Levin Capital sold off roughly 60,000 VNO shares, trimming its position in the company by 28%. The hedge fund’s total stake of $7.06 million in the company accounted for 0.68% of John A. Levin’s portfolio.
You can also take a look at 12 Best Bear Market Stocks to Buy Now and 10 Best Financial Stocks that Pay Dividends
