Dividend Aristocrats Ranked: Top 5 According To Hedge Funds

In this article, we discuss top 5 dividend aristocrats according to hedge funds. If you want to read our detailed analysis of dividend stocks and their performance over the years, go directly to read Dividend Aristocrats Ranked: Top 15 According To Hedge Funds. 

5. NextEra Energy, Inc. (NYSE:NEE)

Number of Hedge Fund Holders: 73

NextEra Energy, Inc. (NYSE:NEE) is a Florida-based renewable energy company that invests in energy infrastructure. In 2022, the company extended its dividend growth streak to 26 years. It currently pays a quarterly dividend of $0.425 per share and has a dividend yield of 1.98%, as of January 18. The company is among one of the best dividend stocks according to hedge funds.

In the third quarter of 2022, NextEra Energy, Inc. (NYSE:NEE) reported revenue of $6.72 billion, which saw a 53.8% growth from the same period last year. The company expects over 10% annual dividend per share growth through 2024.

In January, Wells Fargo raised its price target on NextEra Energy, Inc. (NYSE:NEE) to $110 with an Overweight rating on the shares, highlighting the company’s renewables segment.

The number of hedge funds tracked by Insider Monkey owning stakes in NextEra Energy, Inc. (NYSE:NEE) grew to 73 in Q3 2022, from 59 in the previous quarter. The collective value of these stakes is over $2.1 billion. With 9.4 million shares, Fisher Asset Management was the company’s leading stakeholder in Q3.

ClearBridge Investments mentioned NextEra Energy, Inc. (NYSE:NEE) in its Q3 2022 investor letter. Here is what the firm has to say:

“NextEra Energy, Inc. (NYSE:NEE) is an integrated utility business with a regulated utility operating in Florida and the largest wind business in the U.S. NextEra’s regulated business includes Florida Power & Light, which serves nine million people in Florida. NextEra’s share price rose along with the passage of the U.S. Inflation Reduction Act, which considerably expands support for renewable energy.”

4. Exxon Mobil Corporation (NYSE:XOM)

Number of Hedge Fund Holders: 75

Exxon Mobil Corporation (NYSE:XOM) is a Texas-based oil and gas company that specializes in the distribution of natural gas. The company’s cash generation remained strong in Q3 2022 with an operating cash flow of $24.4 billion and a free cash flow of $19.7 billion. It generated over $112 billion in revenue during the quarter, up 52% from the same period last year.

In January, Mizuho raised its price target on Exxon Mobil Corporation (NYSE:XOM) to $140 with a Buy rating on the shares, calling the company its Top Pick in the energy sector for 2023.

Exxon Mobil Corporation (NYSE:XOM) is among the best dividend stocks according to hedge funds as the company has been raising its payouts for the past 40 years. It currently pays a quarterly dividend of $0.91 per share and has a dividend yield of 3.22%, as of January 18.

As of the close of Q3 2022, 75 hedge funds tracked by Insider Monkey owned stakes in Exxon Mobil Corporation (NYSE:XOM), up from 72 in the previous quarter. The collective value of these stakes is $5.5 billion. Rajiv Jain’s GQG Partners was the company’s leading stakeholder in Q3.

3. AbbVie Inc. (NYSE:ABBV)

Number of Hedge Fund Holders: 80

AbbVie Inc. (NYSE:ABBV) is an American biotech company that provides innovative medical solutions to its patients. In January, Truist raised its price target on the stock to $180 with a Buy rating on the shares, appreciating the company’s growing prescription and share growth trends.

AbbVie Inc. (NYSE:ABBV) maintains a 50-year streak of consistent dividend growth. The company pays a quarterly dividend of $1.48 per share, having raised it by 5% in October 2022. The stock has a dividend yield of 3.87%, as of January 18.

Of the 895 hedge funds tracked by Insider Monkey, 71 funds reported owning stakes in AbbVie Inc. (NYSE:ABBV) in Q2 2022, compared with 75 in the preceding quarter. These stakes are collectively worth over $2.88 billion. Arrowstreet Capital was one of the company’s leading stakeholders in Q3.

Baron Funds mentioned AbbVie Inc. (NYSE:ABBV) in its Q3 2022 investor letter. Here is what the firm has to say:

“AbbVie Inc. (NYSE:ABBV) is a drug developer best known for Humira, an immunosuppressant that is the best selling drug of all time. Given outsized key product risk (patent cliff and generic launches beginning in 2023), AbbVie has broadened its pipeline, highlighted by its Allergan acquisition. Shares fell on results that missed consensus and indications that legacy franchises were outperforming newer product launches, calling into question AbbVie’s long-term strategy. With promising assets in the pipeline and its robust cash flow profile, we believe AbbVie will grow well into the future.”

2. Johnson & Johnson (NYSE:JNJ)

Number of Hedge Fund Holders: 85

Johnson & Johnson (NYSE:JNJ) is one of the leading Big Pharma companies, based in New Jersey, US. The company has been raising its dividends consistently for the past 60 years, which places it as one of the best dividend stocks according to hedge funds. The company offers a quarterly dividend of $1.13 per share and has a dividend yield of 2.62%, as of January 18.

Citigroup raised its price target on Johnson & Johnson (NYSE:JNJ) to $205 with a Buy rating on the shares, appreciating the company’s performance last year.

At the end of Q3 2022, 85 hedge funds in Insider Monkey’s database owned stakes in Johnson & Johnson (NYSE:JNJ), up from 83 in the previous quarter. The collective value of these stakes is over $5.4 billion. Among these hedge funds, Fisher Asset Management was the company’s leading stakeholder in Q3.

Here’s what Distillate Capital Partners LLC said about Johnson & Johnson (NYSE:JNJ) in its Q2 2022 investor letter:

“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. S&P Global Inc. (NYSE:SPGI)

Number of Hedge Fund Holders: 90

S&P Global Inc. (NYSE:SPGI) specializes in financial information and analytics. In January, Argus raised its price target on the stock to $380 with a Buy rating on the shares, appreciating the company’s focus on its faster-growing financial business.

S&P Global Inc. (NYSE:SPGI) currently pays a quarterly dividend of $0.85 per share and has a dividend yield of 0.93%, as of January 18. The company has raised its dividends consistently for the past 49 years. In the first nine months of FY22, the company returned $749 million to shareholders in dividends.

As of the close of Q3 2022, 90 hedge funds tracked by Insider Monkey owned stakes in S&P Global Inc. (NYSE:SPGI), compared with 84 in the previous quarter. These stakes have a collective value of $6.2 billion. Among these hedge funds, TCI Fund Management was the company’s largest stakeholder in Q3.

Baron Funds mentioned S&P Global Inc. (NYSE:SPGI) in its Q3 2022 investor letter. Here is what the firm has to say:

“Shares of rating agency and data provider S&P Global Inc. (NYSE:SPGI) fell 9% during the third quarter due to continued weak debt issuance activity and headwinds to the Indices business from equity market declines. Credit markets were exceptionally soft during the quarter with non-financial corporate bond issuance down 36% for investment grade and down 84% for high yield, reflecting greater investor risk aversion, rising interest rates, and a drop-off in M&A activity. We believe this ratings weakness is temporary and diversification benefits from the acquisition of IHS Markit should support earnings growth next year. Over the long term, the company should continue benefiting from the secular trends of increasing bond issuance, growth in passive investing, and demand for data and analytics, while enjoying meaningful and durable competitive advantages that, in our view, are only strengthening following the merger with IHS Markit.”

You can also take a look at 13 Cash Rich Penny Stocks That Hedge Funds Are Buying and 11 Undervalued Dividend Aristocrats to Buy

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