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.
READ NEXT: Billionaire Cooperman’s Top Dividend Picks and Analysts Are Upgrading These AI Stocks
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.
4. Abbott Laboratories (NYSE:ABT)
Billionaire Paul Tudor Jones Q1’2024 Stake: $56,040,063
With 52 straight years of consistent dividend increases, Abbott Laboratories (NYSE:ABT) is one of the best dividend stocks to buy according to billionaire Paul Tudor Jones. Jones’ fund owns a $56 million stake in Abbott Laboratories (NYSE:ABT) as of the end of Q1.
Abbott Laboratories (NYSE:ABT) specializes in a wide range of products and services which reduces its dependency on any single market and helps it to generate revenue from multiple channels. Wall Street analysts are especially bullish on the company’s growth catalysts in the medical devices segment. The industry is expected to grow by 6.3% annually from $518.5 billion in 2023 revenue to reach $886.8 billion by 2032. During the first quarter, Abbott’s organic sales growth came in at 10.8% YoY, marking its fifth consecutive quarter of double-digit growth.
Abbott’s forward P/E ratio of 23.52 is a bit higher than the industry median of 19, but justified given Wall Street expectations of a 11.00% earnings growth in 2025. Average analyst estimate for ABT is $113.57, which presents a 16% upside potential from the current levels.
Polen Focus Growth Strategy stated the following regarding Abbott Laboratories (NYSE:ABT) in its first quarter 2024 investor letter:
“We increased our positions in ThermoFisher Scientific, Visa, Zoetis, Nike, and Abbott Laboratories (NYSE:ABT). Each of these companies is durable and available at attractive valuations, in our view, for the growth we see ahead. In fact, in the case of ThermoFisher, Nike, and Abbott Labs, we expect accelerating earnings growth in the back half of 2024 after more difficult earnings growth periods pass for each of these companies. ThermoFisher and Abbott will finally wind down most of their COVID-19 testing and vaccine-related efforts due to a lack of demand, so these should no longer be revenue growth headwinds.”
3. Apple Inc (NASDAQ:AAPL)
Billionaire Paul Tudor Jones Q1’2024 Stake: $57,187,894
Despite having a low dividend yield, Apple Inc (NASDAQ:AAPL) is a notable dividend stock thanks to almost a decade of dividend growth and strong share upside potential amid AI-related catalysts. Bank of America recently said in a note Apple Inc’s (NASDAQ:AAPL) plans to overhaul its Siri assistant with new AI-powered features could infuse a new iPhone upgrade cycle. BofA’s Wamsi Mohan expects conversational AI to become more popular and give a boost to AI-powered phones. He has a Buy rating and $230 price target on Apple Inc (NASDAQ:AAPL).
Notable Wall Street analyst and Deepwater Asset Management Managing Partner Gene Munster recently made waves when he said in a post on Twitter that Apple Inc (NASDAQ:AAPL) is a better investment than Nvidia for the long term. Munster believes “owning Apple Inc (NASDAQ:AAPL) over the next year will have a higher return” because the market is in denial about Apple Inc.’s (NASDAQ:AAPL) AI potential. Apple Inc (NASDAQ:AAPL) is trading at 27x its 2025 EPS estimate, which is still a high multiple given Apple Inc’s (NASDAQ:AAPL) 9.60% growth estimate for 2025 and 10.50% per-annum growth expected over the next five years. But all of this could change if Apple Inc (NASDAQ:AAPL) is able to pull AI-related catalysts out of its bag. The WWDC event and the new few weeks and months would be critical for Apple Inc’s (NASDAQ:AAPL) growth trajectory.
RiverPark Large Growth Fund stated the following regarding Apple Inc. (NASDAQ:AAPL) in its first quarter 2024 investor letter:
“Apple Inc. (NASDAQ:AAPL): Apple shares were a top detractor in the quarter. The company’s stock was pressured by negative news items including a government antitrust case, an Apple Watch patent dispute, and slowing China iPhone sales. Ultimately the company’s fiscal 1Q24 earnings report delivered a slightly better than expected quarter, but with guidance that disappointed investors. 1Q24 revenue and gross margin were better than feared, buoyed by stronger than expected worldwide iPhone sales which grew 6% despite a slight decline in China iPhone sales. Services revenue in the quarter was as expected and signaled the third quarter in a row of accelerating growth. Gross margins were also stronger than expected at 45.9%, the highest level in more than a decade. Guidance of $90 billion of revenue for 2Q24 was light however, due to weaker than expected iPhone sales in the current period and year-over-year declines in other hardware products facing difficult year-over year comps.
Although near-term trends are a bit muted, Apple is carrying lean inventory into an iPhone refresh cycle later this year. With an installed base of 2.2 billion active devices and significant growth of the company’s recurring revenue Services segment, we believe that Apple remains one of the most innovative, best positioned and most profitable companies in the mobile technology industry.”
2. Cardinal Health Inc (NYSE:CAH)
Billionaire Paul Tudor Jones Q1’2024 Stake: $59,463,101
Cardinal Health Inc (NYSE:CAH) has increased its dividends for 37 consecutive years. Billionaire Tudor Jones upped his hold in the company by 165% in the first quarter, ending the period with a $59 million stake in Cardinal Health Inc (NYSE:CAH). Last month Cardinal Health Inc (NYSE:CAH) posted fiscal Q3 results. Adjusted EPS in the quarter came in at $2.08, beating estimates by $0.13. Revenue in the period jumped 8.7% year over year to $54.9 billion, missing estimates by $1.21 billion. Overall, analysts have given a positive outlook for the healthcare sector this year, attributing this to ongoing transformations driven by advancements in AI and evolving patient requirements. In its most recent quarter, the company achieved widespread growth, showing significant profit increases in both its Pharmaceutical and Specialty Solutions segments, building on an already strong performance from the previous year. CAH ranks second on our list of the best dividend stocks to buy according to Paul Tudor Jones.
Cardinal Health management talked about guidance during the latest earnings call in May:
“With another solid quarter from Pharmaceutical and Specialty Solutions, we are raising and narrowing our segment profit guidance for the full year to 8.5% to 9.5% growth, which at the midpoint implies continued mid-single digit profit growth in the fourth quarter. We are reiterating our guide for GMPD segment profit of approximately $65 million for fiscal year ’24. We continue to expect to address the impact of inflation as we exit fiscal ’24, along with continued Cardinal Health brand volume growth and benefits from our continued cost savings initiatives. Additionally, we anticipate a positive impact from seasonality in Q4 compared to Q3. We are also reiterating our segment profit guide for the Other businesses, 6% to 8% segment profit growth for the full year, given that we expect a strong Q4 for those businesses.”
Cardinal Health’s forward P/E 13.07, much lower than the industry median of 19.57. Over the next five years the company’s earnings are expected to rise by 11.03% on a per-annum basis.
1. UnitedHealth Group Inc (NYSE:UNH)
Billionaire Paul Tudor Jones Q1’2024 Stake: $67,706,126
UnitedHealth Group Inc (NYSE:UNH) is one of the most famous dividend stocks in the market right now, as the health insurance giant has increased its payout every year since 1990. Billionaire Paul Tudor Jones increased his hold in Unitedhealth Group Inc (NYSE:UNH) by 167% in the March quarter, ending the period with a $68 million stake in Unitedhealth Group Inc (NYSE:UNH). Analysts expect Unitedhealth Group Inc’s (NYSE:UNH) EPS to expand by about 10.5% to $27.75 by the end of 2024. The global health insurance industry is set to grow at a CAGR of 6.2% from 2024 through 2032. This growth would bode well for industry leaders like UNH.
Last month Bank of America Securities analyst Kevin Fischbeck reiterated a Buy rating on UnitedHealth Group Incorporated (NYSE:UNH) with a price target of $675.00. The analyst highlighted UnitedHealth’s efforts to grow its long-term EPS to 13-16%, strong value-based care model, and adaptable business strategy.
UnitedHealth revenue in the first quarter increased by 8.6% year-over-year to $99.8 billion. Its net loss per share of $1.53 was due to the $7.1 billion charge from the sale of its Brazil operations. In 2025, the company’s adjusted EPS is expected to jump 12.3% and by 13.2% in 2026.The company’s forward P/E of 17 is still lower than its 10-year average P/E of 20.2.
Baron Health Care Fund stated the following regarding UnitedHealth Group Incorporated (NYSE:UNH) in its first quarter 2024 investor letter:
“UnitedHealth Group Incorporated (NYSE:UNH) is a leading health insurance company that operates across four segments: United Healthcare, Optum Health, OptumInsight, and OptumRX. Shares fell alongside other managed care organizations (MCOs) due to patient utilization of Medicare Advantage (MA) that was higher than consensus forecasts, raising concerns that MCOs had mispriced 2024 bids and could suffer margin compression as a result. In addition, the industry is facing headwinds from MA reimbursement cuts and Star Rating changes. While management said higher cost trends are mostly transitory and reflected in its bidding, and 2024 guidance was roughly in line with consensus, investors took a more cautious wait-and-see approach. We believe UnitedHealth should remain a core portfolio holding, as it is a way to play positive demographic, population health, and value-based reimbursement trends. Despite its size, we think the company should be able to grow earnings consistent with its 13% to 16% long-term EPS annual target, the fastest among major MCOs.”
While we acknowledge the potential of UnitedHealth Group Inc (NYSE:UNH) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than UNH but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: Michael Burry Is Selling These Stocks and Jim Cramer is Recommending These Stocks.
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also look at the 12 Best Up and Coming Stocks To Buy According to Hedge Funds and the 11 Best AI Penny Stocks to Invest in Now.
