7 Best Warren Buffett Dividend Stocks According to Short Sellers

4. Bank of America Corporation (NYSE:BAC)

Short % of Shares Outstanding: 0.90%

An American multinational investment bank and financial services company, Bank of America Corporation (NYSE:BAC) offers a wide range of related services to its consumers. The company’s ability to weather numerous challenging periods while still serving its customers speaks volumes. As the leader in US retail deposits, it has earned strong customer trust. Since the start of 2024, the stock has gained over 14%, and in the past 12 months, the stock has delivered a 34% return to shareholders.

Bank of America Corporation (NYSE:BAC) consistently remains profitable, a fact that can often be overlooked. Over the past ten years, its average net profit margin has been 25%, enabling the business to regularly pay dividends. In the second quarter of 2024, the company reported revenue of $25.4 billion, which showed a 1% growth from the same period last year. The company’s strong and profitable Consumer Banking business is supported by the growth and success of its Global Markets, Global Banking, and Wealth Management divisions. The Global Markets segment achieved its ninth consecutive quarter of year-over-year revenue growth in sales and trading, delivering double-digit returns. Analysts also believe that BAC is in a favorable position to grow. This was also highlighted by ClearBridge Investments in its Q1 2024 investor letter:

“We added several new positions during the quarter. Our largest new addition was Bank of America Corporation (NYSE:BAC), one of the world’s leading financial institutions, serving some 66 million consumer and small business clients across the U.S. as well as large corporations, financial institutions and governments globally. We believe that the interest rate pressure that Bank of America faced in early 2023 has subsided, and risks surrounding deposit outflows have abated, which should allow the company to improve its book value and capital growth as well as benefit from a rebound of capital markets activity.”

Bank of America Corporation (NYSE:BAC) is also a strong dividend payer, distributing regular dividends to shareholders for the past 26 years. In the most recent quarter, the company paid $2 billion to shareholders through dividends. Its quarterly dividend comes in at $0.26 per share for a dividend yield of 2.7%, as of September 15.

Of the 912 hedge funds tracked by Insider Monkey at the end of Q2 2024, 92 funds invested in Bank of America Corporation (NYSE:BAC), up from 82 a quarter earlier. The stakes owned by these hedge funds have a total value of more than $48 billion.