In this article, we will take a detailed look at the Top Dividend Stocks to Buy in 2024 According to Billionaire Paul Tudor Jones.
Billionaire Paul Tudor Jones recently made headlines after he participated in the Robin Hood foundation’s fundraising event dressed as Neo from the movie “The Matrix.” The event raised $68.5 million. The billionaire, who founded Tudor Investment Corporation in 1980, couldn’t help himself but talk about investing during the event, and highlighted the importance of “Warren Buffett-style compounding.”
“Somewhere, somehow the multiplicative power of compound put you in this seat,” Tudor Jones said.
Paul Tudor Jones’ Recession Prediction
During an interview last year, the billionaire had predicted that a recession was expected to start in the first quarter of 2024. He said at the time that the US was in its “weakest position” since World War II. However, the market rally fueled by AI proved the prediction wrong. Earlier this year, Jones said in another interview that the financial markets represent people’s ideas and what they make of the economic situation. Paul Tudor Jones said that there’s a chance the stock market would be “here or lower” in the next five to ten years. However, the billionaire also said it’s possible that the markets would go higher from here if the next President of the US devises a better “policy response” next year.
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He’s been vocal about AI lately and sharing his thoughts about the impact of technology on our society. He thinks AI could be the “knight on the horse that rides and saves us.”
But AI-related threats worry Paul Tudor Jones. In an interview in January he referred to a survey where close to 3,000 AI experts were asked whether they believe AI would end humanity. According to Jones, a whopping 58% of the experts said yes. The billionaire said US policymakers will have to decide how to tackle this problem. Jones believes AI is growing at an “unbridled pace” since there’s so much money to be made in the domain but the biggest problem for policymakers would be to balance the benefits and threats of AI to make it sustainable.
For this article we scanned billionaire Paul Tudor Jones’ Q1 portfolio and chose his top dividend stock picks. Why are we interested in 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).
9. Starbucks Corp (NASDAQ:SBUX)
Billionaire Paul Tudor Jones Q1’2024 Stake: $37,574,816
Billionaire Paul Tudor Jones increased his stake in Starbucks Corp (NASDAQ:SBUX) by 193% in the first quarter of 2024, ending the period with a $37.6 million stake in the coffee chain, which has seen its share price tank by about 20% over the past one year. Starbucks Corp (NASDAQ:SBUX) shares fell recently after Starbucks Corp (NASDAQ:SBUX) posted weak fiscal Q2 results and guidance, as customers in China and across the globe cut back on spending. However, many analysts believe the stock is presenting an opportunity for long-term investors. Based on Wall Street’s 2025 EPS estimate ($8.67) for Starbucks Corp (NASDAQ:SBUX), the stock is trading at a forward P/E multiple of 19, which is not much higher than the industry median of 14.97. Given Starbucks Corp’s (NASDAQ:SBUX) brand value and moat, the company stands out amongst competitors. The stock’s current P/E of 22 is also much lower than Starbucks Corp’s (NASDAQ:SBUX) five-year average P/E of 30. SBUX is one of the top dividend stocks to buy in 2024
As of the end of the first quarter of 2024, 69 hedge funds reported owning stakes in Starbucks Corp (NASDAQ:SBUX), up from 59 funds in the same quarter last year.
Vulcan Value Partners stated the following regarding Starbucks Corporation (NASDAQ:SBUX) in its first quarter 2024 investor letter:
“We are pleased to have purchased Starbucks Corporation (NASDAQ:SBUX) in the first quarter. We have owned the company in the past, and it was a good investment for us. The company has strong brand recognition, global distribution, and outstanding retail real estate. The company generates robust free cash flow and has high returns on invested capital as well as a strong balance sheet. Starbucks has used its financial resources to strengthen its brand and enhance customer loyalty. Additionally, the company has continued to see attractive returns from opening new stores. Stock price volatility over the last year is likely due to management changes, disappointing short-term results, and general hesitancy about consumer spending. We believe that Starbucks’ competitive position remains intact, and its value will continue to compound over our five-year plus time horizon.”
8. Danaher Corp (NYSE:DHR)
Billionaire Paul Tudor Jones Q1’2024 Stake: $41,867,805
Danaher Corp (NYSE:DHR) ranks 8th on our list of the best dividend stock picks of billionaire Paul Tudor Jones. The manufacturer of medical and industrial equipment’s stock has a dividend yield of about 0.9%. Analysts expect Danaher Corp’s (NYSE:DHR) sales growth to enter the upbeat territory this year. During the first quarter, Danaher Corp’s (NYSE:DHR) net sales declined 2.5% on a YoY basis. However, this decline was better than the 10.3% decline Danaher Corp (NYSE:DHR) saw in full-year 2023. While the stock’s P/E ratio is higher at 43, it’s trading at around 29X its forward P/E ratio based on its 2025 EPS estimate of $8.67. Analysts believe the worst is over for the stock and investors should wait for a turnaround. While further revenue decline is expected amid a muted activity in the biosciences and biopharma segments, long-term analysts believe Danaher Corp (NYSE:DHR) shares are a Buy at the current levels. DHR is one of the top dividend stocks to buy in 2024
Cooper Investors Global Equities Fund stated the following regarding Danaher Corporation (NYSE:DHR) in its first quarter 2024 investor letter:
“On the funding side, the portfolio fully exited Danaher Corporation (NYSE:DHR) during the quarter. We no longer see compelling Risk Adjusted Value Latency today with the shares rebounding 35% since the October lows and once again trading at a significant relative premium (50-60%), despite tough operating trends in the bioprocessing market. Having owned Danaher continuously for the past 14 years this is ‘the end of an era’ and so bears a brief tribute.
Danaher was the longest held stock in the portfolio having been initially purchased in July 2010. Investing alongside the Rales brothers has been an incredible experience. In returns generation, Danaher was a true 10-bagger; purchased at USD$25 a share and sold at ~USD$255, generating a return over the holding period of over 1,300% and an IRR of approximately 18%.
Yet its value has not merely been as a winning stock but also as a teacher, a source of idea generation, and a spin-off machine. Danaher was the original ‘Capital Allocator Champion’, through which we learned about the margin-expansionary benefits of focused business systems operating with continuous improvement – Kaizens running concurrently on the lab or factory floor. We also built an understanding of how Danaher operates its M&A philosophy, a major driver of its success – what to buy, when to buy, who to buy from, how to integrate, and how much to pay. Studying this allowed us to develop Pattern Recognition of ‘what good looks like’ when meeting similar companies. Without Danaher, we may never have owned Domino Printing Sciences, Constellation Software, Halma, Roper, Ametek or Diploma, not to mention the spin- offs, some of which remain in the portfolio today. The business remains on our Watchlist through our continuous coverage of the Life Sciences cluster.”
7. Occidental Petroleum Corp (NYSE:OXY)
Billionaire Paul Tudor Jones Q1’2024 Stake: $45,974,706
Occidental Petroleum Corp (NYSE:OXY) has a dividend yield of about 1.4% as of June 3, and Occidental Petroleum Corp (NYSE:OXY) has maintained a consistent dividend payment record since 1985. Last month, Morgan Stanley published a list of stocks it believes are suitable for investors to survive the current economic volatility. The firm recommended Occidental Petroleum Corp (NYSE:OXY) as a high-quality growth stock. In December 2023 Occidental Petroleum Corp (NYSE:OXY) made headlines after announcing it would buy CrownRock for a whopping $12 billion. The deal would add 170 thousand barrels/day in production for Occidental Petroleum Corp (NYSE:OXY).
Warren Buffett having over $16.1 billion worth of stake in Occidental Petroleum Corp (NYSE:OXY) would be a huge confidence booster for both current and prospective investors for Occidental Petroleum Corp (NYSE:OXY). But Wall Street has many other reasons to call this stock a buy. Occidental Petroleum Corp (NYSE:OXY) expects to increase its FCF by $1 billion by the second half of 2026. Analysts also believe the CrownRock deal would add about 170 mboed of high-margin, lower-decline unconventional production from the Midland Basin. Based on Wall Street’s average price target of $71 for OXY, the stock has an upside potential of about 15% from its current levels.
6. Amgen Inc (NASDAQ:AMGN)
Billionaire Paul Tudor Jones Q1’2024 Stake: $46,742,208
Biopharmaceutical company Amgen Inc (NASDAQ:AMGN) is a new stock pick of billionaire Paul Tudor Jones as his investment fund bought 164,400 shares of Amgen Inc (NASDAQ:AMGN) for about $47 million. Analysts believe Amgen Inc (NASDAQ:AMGN) could become a promising weight loss stock, as Amgen Inc’s (NASDAQ:AMGN) management in latest earnings call talked in detail about the phase 2 trial of the drug. Here’s what Amgen Inc (NASDAQ:AMGN) said:
“All arms remain active, patient dropout has not been an issue, and we’re fully on track for top line 52-week data from this 11-arm Phase II study in late 2024. We’re seeing a differentiated profile of MariTide and are confident that it will address important unmet medical needs, obesity, obesity-related conditions and diabetes. We look forward to completing the ongoing Phase II study and working with regulators to move rapidly to the broad Phase III program. Later this year, we plan to initiate an additional dedicated Phase II trial investigating MariTide for the treatment of diabetes in patients with and without obesity.
This new trial is not a gating step for our Phase III program in patients with obesity. Informed by dose and schedule insights from the ongoing Phase II obesity study, the dedicated Phase II study in diabetes conforms to regulatory requirements for Phase III and is the next step towards a diabetes indication for MariTide. In terms of patient experience, we expect to deliver MariTide in a convenient, handheld, patient-friendly auto-injector device with a monthly or even less frequent single-injection administration, assuming eventual approval. [read the full earrings call transcript here]”
As of the end of the first quarter of 2024, 63 hedge funds tracked by Insider Monkey reported owning stakes in Amgen Inc (NASDAQ:AMGN). The biggest stakeholder of Amgen Inc (NASDAQ:AMGN) during this period was David Kroin’s Deep Track Capital which owns a $156 million stake in Amgen Inc (NASDAQ:AMGN).
Based on 2025 EPS estimate of $20.44 for Amgen Inc (NASDAQ:AMGN), the stock’s forward PE ratio is around 15, which is less than the industry average of 19. Analysts believe the stock is undervalued as Amgen Inc (NASDAQ:AMGN) is poised to grow earnings and revenue thanks to its weight loss drug and other catalysts including lung cancer treatment. William Blair recently upgraded the stock following Amgen Inc’s (NASDAQ:AMGN) bullish remarks on weight loss drug MariTide. AMGN is one of the top dividend stocks to buy in 2024.
5. Philip Morris International Inc. (NYSE:PM)
Billionaire Paul Tudor Jones Q1’2024 Stake: $46,955,616
Billionaire Paul Tudor Jones increased his stake in tobacco giant Philip Morris International Inc. (NYSE:PM) by 474% in the first quarter of 2024, ending the quarter with a $47 million stake. Philip Morris International Inc. (NYSE:PM) has increased its dividend every year since 2008. Philip Morris International Inc. (NYSE:PM) is one of the high-yield dividend stocks in billionaire Tudor Jones portfolio since the stock’s dividend yield stands at over 5%. Philip Morris International Inc. (NYSE:PM) was able to increase its Q1 revenue by 3.5% on a YoY basis despite headwinds in the traditional smoking product segments as Americans leave combustible tobacco products for smoke-free products. Analysts believe Philip Morris International Inc. (NYSE:PM) is making a smooth transition, thanks to its smoke-free product category led by IQOS and VEEV vapes. PM ranks 5th on our list of the best dividend stocks to buy in 2024 according to Paul Tudor Jones.
According to data from Yahoo Finance, Wall Street’s one-year average analyst price target for Philip Morris International Inc. (NYSE:PM) is $109.52, which presents an upside potential of 8%. Based on Philip Morris International Inc. (NYSE:PM) 2024 EPS estimate of $6.9 (according to Yahoo Finance), its forward P/E ratio is around 14.7, much lower than the sector median of 17.