Billionaire Ray Dalio’s Top 5 Dividend Stocks

In this article, we will discuss the top dividend stocks to buy according to billionaire Ray Dalio. If you want to read our detailed analysis of Dalio’s investment strategy and his hedge fund’s performance in the past, go directly to read Billionaire Ray Dalio’s Top 10 Dividend Stocks.

5. Costco Wholesale Corporation (NASDAQ:COST)

Bridgewater Associates’ Stake Value: $566,509,000
Dividend Yield as of November 16: 0.68%

Costco Wholesale Corporation (NASDAQ:COST) is a Washington-based retail company. The company has been raising its dividends consistently for the past 18 years, which makes it one of the top dividend stocks on our list. It currently pays a quarterly dividend of $0.90 per share and has a dividend yield of 0.68%, as recorded on November 16.

At the end of Q3 2022, Bridgewater Associates owned nearly 2 million shares in Costco Wholesale Corporation (NASDAQ:COST), worth over $566.5 million. The company constituted 2.86% of billionaire Ray Dalio’s portfolio.

In October, Morgan Stanley raised its price target on Costco Wholesale Corporation (NASDAQ:COST) to $525 with an Overweight rating on the shares, appreciating the company’s market share gains and unit growth.

As of the close of Q2 2022, 64 hedge funds tracked by Insider Monkey owned stakes in Costco Wholesale Corporation (NASDAQ:COST), up from 61 in the preceding quarter. These stakes are collectively valued at over $4.76 billion. With stakes over $2 billion, Fisher Asset Management owned the largest position in the company in Q2.

Cooper Investors mentioned Costco Wholesale Corporation (NASDAQ:COST) in its Q3 2022 investor letter. Here is what the firm has to say:

“The US economy continues to run hot – the labour market is extremely tight and a number of executives we spoke to described their challenges in retaining staff and preventing competitors from poaching talent. Industrial companies in particular continue to see record backlogs, with the easing of logistics and supply chain constraints only just starting to have an impact on deliveries and lead times.

In terms of inflationary pressures, the vast majority of our holdings have been able to leverage strong market positions and stakeholder relationships to push pricing through in 2022 such that minimal impact to earnings has occurred. Clearly this is not a lever than can be pulled indefinitely but the more experienced management teams have kept some of their powder dry. Our meeting with management at Costco in Seattle was memorable for several reasons but one was their latent ability to increase member pricing which they have not done in over 5 years (and thus likely to do in 2023)…

…To conclude we’ll return to our meeting with Costco mentioned earlier. The business quality is no secret after decades of incredible execution, but the meeting gave us renewed conviction around Value Latencies in terms of the runway for growth, the focus on enhancing customer value, Costco’s vast buying power (it purchases 30% of the world’s jumbo cashews as one example) and management’s feral focus on the business model and cost discipline.”

4. The Coca-Cola Company (NYSE:KO)

Bridgewater Associates’ Stake Value: $642,397,000
Dividend Yield as of November 16: 2.90%

An American multinational beverage company, The Coca-Cola Company (NYSE:KO) has been a part of Bridgewater Associates’ 13F portfolio since the fourth quarter of 2010. In the most recent quarter, the hedge fund increased its KO stake by 6%, which takes its total stake in the company to over $642.3 million. The company accounted for 3.25% of billionaire Ray Dalio’s portfolio.

The Coca-Cola Company (NYSE:KO) pays a quarterly dividend of $0.44 per share for a dividend yield of 2.90%, as of November 16. The company maintains a 60-year track record of consistent dividend growth, falling into the category of Dividend Kings.

In October, UBS acknowledged the organic growth and recent quarterly earnings of The Coca-Cola Company (NYSE:KO) and raised its price target on the stock to $68 while maintaining a Buy rating on the shares.

At the end of the June quarter, 60 hedge funds in Insider Monkey’s database owned stakes in The Coca-Cola Company (NYSE:KO), down from 64 in the previous quarter. These stakes have a total value of over $28.3 billion.

Aristotle Capital Management, LLC mentioned The Coca-Cola Company (NYSE:KO) in its Q2 2022 investor letter. Here is what the firm has to say:

“The Coca-Cola Company (NYSE:KO), the global beverage business, was a leading contributor for the period. Coca-Cola continues to benefit from the refranchising of its bottling operations and realignment of incentives, catalysts we previously identified. These initiatives are demonstrating their strength in an inflationary and supply-chain-challenged environment. Additionally, the company has focused on evolving its customer engagement practices by leveraging digital and social medias for targeted campaigns, such as the design and launch of Coke Byte in the metaverse. Lastly, Coca-Cola has furthered its transformation into a total beverage company, as it debuted its new Jack Daniel’s Tennessee Whiskey and Coca-Cola ready-to-drink premixed cocktail. Although uncertainties surrounding cost pressures, lockdowns and geopolitical conflicts remain, we believe Coca-Cola is uniquely positioned to successfully continue its transition toward a total beverage business.”

3. PepsiCo, Inc. (NASDAQ:PEP)

Bridgewater Associates’ Stake Value: $656,549,000
Dividend Yield as of November 16: 2.57%

Another top dividend stock to buy in billionaire Ray Dalio’s portfolio is PepsiCo, Inc. (NASDAQ:PEP). The food and beverage company has raised its dividends for 50 years in a row. It currently offers a quarterly dividend of $1.15 per share and has a dividend yield of 2.57%, as of November 16.

Ray Dalio has been investing in PepsiCo, Inc. (NASDAQ:PEP) since the fourth quarter of 2010 when his hedge fund purchased shares worth $16.4 million in the company. At the end of Q3 2022, the fund owned over 4 million PEP shares worth over $656.5 million, after increasing its position in the company by 6%. The company represented 3.32% of the firm’s 13F portfolio.

In October, Barclays raised its price target on PepsiCo, Inc. (NASDAQ:PEP) to $185 with an Overweight rating on the shares, appreciating the flexibility in its operations and its overall fundamentals.

The number of hedge funds tracked by Insider Monkey owning stakes in PepsiCo, Inc. (NASDAQ:PEP) stood at 65 in Q2 2022, growing from 62 in the previous quarter. The collective value of these stakes is over $5.28 billion.

2. Johnson & Johnson (NYSE:JNJ)

Bridgewater Associates’ Stake Value: $769,836,000
Dividend Yield as of November 16: 2.60%

Johnson & Johnson (NYSE:JNJ) is a New Jersey-based pharmaceutical company. In October, Citigroup maintained a Buy rating on the stock with a $198 price target as the firm remained positive for the medical device sector and believes that the company will benefit from its medicine sales in the upcoming quarters.

Johnson & Johnson (NYSE:JNJ) has been raising its dividends consistently for the past 60 years. The company currently pays a quarterly dividend of $1.13 per share with a dividend yield of 2.60%, as of November 16.

During Q3 2022, Bridgewater Associates increased its position in Johnson & Johnson (NYSE:JNJ) by 9%. The firm currently owns over 4.7 million shares in the company, worth nearly $770 million. The company accounted for 3.89% of billionaire Ray Dalio’s portfolio.

At the end of the second quarter of 2022, 83 hedge funds tracked by Insider Monkey owned stakes in Johnson & Johnson (NYSE:JNJ), with a total value of over $6.7 billion.

Distillate Capital Partners LLC mentioned Johnson & Johnson (NYSE:JNJ) in its Q2 2022 investor letter. Here is what the firm has to say:

“Johnson & Johnson was among the 2 largest trims at around 1% each. Each stock was up 1% in the quarter compared to the 16% price decline for the S&P 500 and the positions were reduced as the valuations became somewhat less appealing, though still attractive enough to warrant inclusion.”

1. The Procter & Gamble Company (NYSE:PG)

Bridgewater Associates’ Stake Value: $835,201,000
Dividend Yield as of November 16: 2.57%

The Procter & Gamble Company (NYSE:PG), an American multinational consumer goods company, was the largest holding of Bridgewater Associates at the end of Q3 2022. The hedge fund owned over 6.6 million PG shares, worth over $835.2 million. The company made up 4.22% of billionaire Ray Dalio’s portfolio.

The Procter & Gamble Company (NYSE:PG) is one of the strongest dividend companies in the US. The company has been making consistent dividend payments for the past 132 years and has also raised its payouts for 66 years in a row. It currently pays a quarterly dividend of $0.9133 per share and has a dividend yield of 2.57%, as of November 16.

In November, Wells Fargo lifted its price target on The Procter & Gamble Company (NYSE:PG) to $155 with an Overweight rating on the shares, highlighting the company’s business model post-pandemic.

As of the close of Q2 2022, 71 hedge funds owned stakes in The Procter & Gamble Company (NYSE:PG), compared with 72 a quarter earlier, as per Insider Monkey’s database. These stakes hold a consolidated value of over $5.5 billion.

You can also take a look at Billionaire Seth Klarman’s Top 9 Dividend Stock Picks and 15 Best Consistent Dividend Stocks to Buy

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