The Smart Money Is Bullish On These 5 Dividend Stocks

#3 Entergy Corporation (NYSE:ETR)

Number of Hedge Fund Holders (as of September 30): 29
Total Value of Hedge Fund Holdings (as of September 30): $683.7 million
Hedge Fund Holdings as Percent of Float (as of September 30): 5.80%

It’s been a difficult year for utility companies and Entergy Corporation (NYSE:ETR) is certainly no exception. Shares of the electric power producer and distributor have fallen by 23% year-to-date as investors begin cycling out of utilities given the normalizing Treasury yields. While investors have been bearish, the smart money has been increasingly optimistic in large part due to ETR’s durable cash flows and its dividend yield of over 5%. According to our extensive database of around 730 elite funds, 29 funds were long ETR, holding $683 million worth of shares at the end of September, up from 19 funds and $417.55 million at the end of June. Among the bullish hedge funds are Jim Simons’ Renaissance Technologies, with a holding of 2.47 million shares, and Cliff Asness’ AQR Capital Management, with a stake of 1.3 million shares.

Number of Hedge Fund Holders (as of September 30): 40
Total Value of Hedge Fund Holdings (as of September 30): $954.81 million
Hedge Fund Holdings as Percent of Float (as of September 30): 3.70%

As previously mentioned, it’s been a down year for most utility companies as big mutual funds rotate out of the sector due to normalizing yields. Although Exelon Corporation (NYSE:EXC) shares are down 23% year-to-date because of the Great Rotation, Exelon’s decline has made it an attractive dividend play. Shares now yield 4.57% and trade at a reasonable 10.6 times forward earnings. Seeing as the company’s payout ratio of 0.55, Exelon’s dividend is secure and has room to expand given the company’s predicted next five year average EPS growth rate of 5.03%. Hedge funds are certainly bullish as the number of elite funds long the stock jumped by 10 during the third quarter.