In this article, we discuss the 5 safe dividend stocks for a retirement stock portfolio. If you want to read about some more dividend stocks, go directly to Retirement Stock Portfolio: 11 Safe Dividend Stocks to Consider.
5. AT&T Inc. (NYSE:T)
Number of Hedge Fund Holders: 61
Dividend Yield as of November 28: 5.81%
AT&T Inc. (NYSE:T) provides telecommunications, media, and technical services worldwide.
On October 24, Raymond James analyst Frank Louthan upgraded AT&T Inc. (NYSE:T) stock to Strong Buy from Outperform with an unchanged price target of $24, highlighting that the company will outpace Verizon over the next few months based on the current operating performance of the two businesses.
At the end of the third quarter of 2022, 61 hedge funds in the database of Insider Monkey held stakes worth $1.5 billion in AT&T Inc. (NYSE:T), compared to 55 in the preceding quarter worth $1.7 billion.
In its Q2 2022 investor letter, Argosy Investors, an asset management firm, highlighted a few stocks and AT&T Inc. (NYSE:T) was one of them. Here is what the fund said:
“I purchased shares of AT&T Inc. (NYSE:T) prior to its spin-off of Warner Brothers Discovery (WBD). Most people are probably familiar with AT&T. They are a major cellular service provider, and until recently owner of the Time Warner media assets, which include HBO, CNN, TNT, TBS, Cartoon Network, DC Comics and Batman content brands, and more. At the time of my purchase, I estimated that the combined T/WBD assets traded at a 15% levered FCF yield, or 6x FCF. I also believe that WBD, which now has HBO Max, has future growth in front of it which was previously in doubt when Discovery was primarily tied to the declining cable television bundle. Since then, Netflix reported disappointing subscriber growth, which threw all streaming companies into disarray. WBD followed that news with a disappointing outlook on its business during its quarterly earnings.
As a result, shares of WBD have declined nearly 40% since the spin-off. WBD now trades for 7x 2023E FCF and there is great potential for returns over the next few years as WBD pays down debt used to finance its merger combining Warner Brothers and Discovery and grows. We do not own a large position in WBD at present, but we may add to it over time.”
4. Philip Morris International Inc. (NYSE:PM)
Number of Hedge Fund Holders: 63
Dividend Yield as of November 28: 5.17%
Philip Morris International Inc. (NYSE:PM) operates as a tobacco company working to deliver a smoke-free future and evolving portfolio for the long term to include products outside of the tobacco and nicotine sector. It is one of the elite dividend stocks for a retirement stock portfolio. On November 6, Elliot Management is said to put its support behind Philip Morris International’s increased $15.7 billion offer for Swedish Match, which will allow the deal to cross the finish line. Philip Morris’ offer is said to have received 80% of acceptance of Swedish Match.
On November 2, Morgan Stanley analyst Pamela Kaufman maintained an Overweight rating on Philip Morris International Inc. (NYSE:PM) stock and raised the price target to $109 from $102, noting that the company’s recent agreement with Altria Group to regain control of IQOS distribution will allow it to introduce IQOS in the US by 2024.
Among the hedge funds being tracked by Insider Monkey, Fort Lauderdale, Florida-based investment firm GQG Partners is a leading shareholder in Philip Morris International Inc. (NYSE:PM) with 17.4 million shares worth more than $1.4 billion.
In its Q2 2022 investor letter, Artisan Partners, an asset management firm, highlighted a few stocks and Philip Morris International Inc. (NYSE:PM) was one of them. Here is what the fund said:
“On the positive side of the ledger, our top contributor was Swedish Match, a Swedish tobacco and nicotine products maker. The company received an all-cash takeover offer from rival Philip Morris International Inc. (NYSE:PM), which we also held in the portfolio, for SEK 106 per share—a 35% premium to Swedish Match’s prior closing share price. The deal is a good fit for PM as it reduces PM’s dependence on cigarettes—a category in steady decline—and accelerates the company’s transition to smokeless “reduced-risk” products (RRPs)—a category that has experienced rapid growth over the past five years. PM can also leverage its global scale to generate significant revenue synergies from these complementary product sets, as well as quickly gain access to the US market—the world’s largest market for RRPs and one where regulators have embraced RRPs and other less harmful nicotine products. We exited our position in Swedish Match as shares approached the takeout price.”
3. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 66
Dividend Yield as of November 28: 3.09%
Chevron Corporation (NYSE:CVX) engages in integrated energy and chemical operations worldwide. It is one of the premier dividend stocks for a retirement stock portfolio. On October 5, the Biden administration was preparing to scale down the sanctions on Venezuela to allow Chevron to resume pumping oil in the country, marking a milestone in the reopening of the US and European markets to oil exports in Venezuela.
On October 31, Cowen analyst Charles Ryhee maintained an Outperform rating on Chevron Corporation (NYSE:CVX) stock and raised the price target to $185 from $160, noting that the company reiterated a disciplined approach to M&A and buyback despite an ever-improving balance sheet.
At the end of the third quarter of 2022, 66 hedge funds in the database of Insider Monkey held stakes worth $27 billion in Chevron Corporation (NYSE:CVX), compared to 59 in the preceding quarter worth $26 billion.
In its Q1 2022 investor letter, Diamond Hill, an asset management firm, highlighted a few stocks and Chevron Corporation (NYSE:CVX) was one of them. Here is what the fund said:
“Other top contributors in Q1 included multinational energy company Chevron Corp. (NYSE:CVX). The company benefited from increased energy demand as COVID-related economic restrictions eased in tandem with concerns regarding supply interruptions related to Russia’s invasion of Ukraine.”
2. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 85
Dividend Yield as of November 28: 2.55%
Johnson & Johnson (NYSE:JNJ) researches and develops, manufactures, and sells various products in the healthcare field. It is one of the top dividend stocks for a retirement stock portfolio. On November 1, according to CNBC’s David Faber, Johnson and Johnson approached Abiomed, a medical device technology company, to start talks regarding a merger. On October 25, reports had indicated that the firm had agreed to acquire Abiomed for an upfront payment of $380 per share in cash.
On October 19, Bernstein analyst Lee Hambright maintained a Market Perform rating on Johnson & Johnson (NYSE:JNJ) stock and lowered the price target to $190 from $194, noting that the company reported strong third quarter results as sales grew 8.2% organic to $23.8 billion.
Among the hedge funds being tracked by Insider Monkey, Camas, Washington-based firm Fisher Asset Management is a leading shareholder in Johnson & Johnson (NYSE:JNJ) with 5.9 million shares worth more than $967.3 million.
In its Q2 2022 investor letter, Mayar Capital, an asset management firm, highlighted a few stocks and Johnson & Johnson (NYSE:JNJ) was one of them. Here is what the fund said:
“Johnson & Johnson (NYSE:JNJ) is currently our largest position and a long-standing holding. The majority of the group’s sales come from its collection of pharmaceutical franchises, but a large majority (~45%) comes from its collection of medical device businesses and its consumer brands.
Here’s how JNJ make and spends a dollar of revenues: As of 2021, about 55 cents of that dollar comes from its pharmaceutical sales – sales of drugs to pharmacies and distributors – while 30 cents come from the sale of medical devices, such as surgery equipment and orthopaedics. The rest of that dollar in sales comes from sales of JNJ’s consumer brands such as Listerine mouthwash, Nicorette nicotine tablets and Neutrogena cosmetics (…read more)
1. The Home Depot, Inc. (NYSE:HD)
Number of Hedge Fund Holders: 89
Dividend Yield as of November 28: 2.33%
Home Depot, Inc. (NYSE:HD) operates as a home improvement retailer. It is one of the major dividend stocks for a retirement stock portfolio. On October 24, after the announcement of Cause For Alarm, Home Depot joined hands with Kidde, provider of healthy, safe and sustainable building solutions, and other businesses to donate fire safety products to the New York City Fire Department Foundation and Habitat for Humanity.
On October 31, Citi analyst Steven Zaccone maintained a Buy rating on The Home Depot, Inc. (NYSE:HD) stock and lowered the price target to $340 from $348, noting that the macro fears are high for his hardline retail coverage heading into the third quarter earnings season.
Among the hedge funds being tracked by Insider Monkey, Camas, Washington-based firm Fisher Asset Management is a leading shareholder in The Home Depot, Inc. (NYSE:HD) with 8.1 million shares worth more than $2.3 billion.
In its Q1 2022 investor letter, Diamond Hill Capital, an asset management firm, highlighted a few stocks and The Home Depot, Inc. (NYSE:HD) was one of them. Here is what the fund said:
“The Home Depot, Inc. (NYSE:HD) shares underperformed as continued solid fundamental results were outweighed by concerns about the impact rising mortgage rates may have on the housing market and general inflationary pressures potentially leading to a consumer spending slowdown. We view the long-term prospects and multi-year fundamental outlook as unchanged.”
You can also take a peek at 10 Growth Stocks with Upside Potential and 14 Best Agriculture Stocks To Buy Now.
