We recently compiled a list of the 12 Best International Dividend Stocks To Buy Now. In this article, we are going to take a look at where AstraZeneca PLC (NASDAQ:AZN) stands against the other international dividend stocks.
Dividend stocks have been grabbing investors’ attention for a while now. According to JP Morgan, over the last two decades, global dividends per share have increased at an annual rate of 5.6%, but analysts expect this to rise to 7.6% in the future, driven by historically low payout ratios. During the 2020 pandemic, many companies cut dividends, but as earnings have recovered, especially in Big Tech and AI, dividends have not kept up. With payout ratios at 25-year lows, simply returning to normal could add 2% annual growth over the next five years.
After slowing down post-COVID, global dividend growth made a surprising comeback last year, increasing 8% and adding an extra $180 billion in payouts despite ongoing economic and geopolitical challenges. According to S&P Global, this was largely driven by record dividend initiations in US tech, European banks, Japan’s auto industry, and solid growth from China. Even oil and gas companies held strong despite market volatility. Looking ahead, experts predict global dividends will hold steady at $2.3 trillion in 2025.
Regionally, developed Asia, which includes Japan, Hong Kong, Australia, South Korea, and Singapore, is looking at a 3% rise in dividends this year. Europe, on the other hand, is expected to see a 3.4% decline. In emerging markets, the trends are mixed. Asia, led by China, India, and Taiwan, is on track for a 5% increase, while dividends in the Middle East and Africa could drop by 20%, mainly because Saudi Aramco’s special dividend program ended. Latin America is also expected to see a small dip of around 4%.
When it comes to sectors, banks and energy companies remain the biggest dividend payers. Banks are expected to distribute around $380 billion globally, but after four years of rapid 20% growth, they are now down to just 2%. Banks are playing it safe, waiting to see how interest rates move. Given this, we will take a look at some of the best international dividend stocks.
Our Methodology
For this article, we used the BlackRock International Dividend ETF to filter out dividend stocks listed on US exchanges but headquartered internationally. We focused on picking stocks that were most popular among hedge funds. The list below is ranked in the ascending order of Q3 2024 hedge fund sentiment, and dividend yields are mentioned as of February 11.
At Insider Monkey, we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here)
A pharmacy worker distributing prescription medicines to patientsreceiving treatment for oncology, cardiovascular, renal, metabolism and respiratory diseases.
AstraZeneca PLC (NASDAQ:AZN)
Dividend Yield as of February 11: 2.09%
Number of Hedge Fund Holders: 42
The British biopharmaceutical giant, AstraZeneca PLC (NASDAQ:AZN), specializes in developing and selling prescription medicines for oncology, cardiovascular, renal, metabolism, respiratory, and rare diseases. Recently, the company has canceled its £450 million investment to expand a vaccine plant in Merseyside, citing reduced government support. The company reasoned that prolonged discussions and changes to the government’s offer influenced the move. Despite this, AstraZeneca’s Speke site will continue providing flu vaccines for UK and global patients.
In May 2024, AstraZeneca PLC (NASDAQ:AZN) communicated that it plans to launch 20 new medicines by 2030 and has already secured approval for eight, including Datroway. The company’s total revenue jumped 25% in Q4, with full-year revenue up 21%, beating its own revised forecasts. Product sales saw a solid 19% growth for the year, fueled by strong demand across different regions.
AstraZeneca PLC (NASDAQ:AZN) raised its 2024 dividend to $3.10 per share and announced plans to increase it again to $3.20 for 2025. Moreover, AZN expects total revenue to grow by a high single-digit percentage in 2025, with core EPS rising by a low double-digit percentage, supported by strong growth momentum despite anticipated challenges.
Among the hedge funds tracked by Insider Monkey, AstraZeneca PLC (NASDAQ:AZN) was found in 42 stock portfolios, compared to 49 in the last quarter. Ken Fisher’s Fisher Asset Management is the largest stakeholder in the company, with 10.4 million shares worth $816.5 million.
Overall AZN ranks 7th on our list of the best international dividend stocks to buy. While we acknowledge the potential of AZN as an investment, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AZN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.