10 Best Dividend Stocks to Buy According to Billionaire Richard Chilton
In this article, we discuss the 10 best dividend stocks to buy according to billionaire Richard Chilton. If you want to skip our detailed analysis of Chilton’s history and hedge fund performance, go directly to the 5 Best Dividend Stocks to Buy Now According to billionaire Richard Chilton. Note that all hedge fund data is based on the exclusive group of 800+ funds tracked by Insider Monkey as part of our market-beating investment strategy.
Richard Lockwood Chilton is the brain behind Chilton Investment Company, a hedge fund founded in 1992. A graduate of Alfred University in Western New York, Chilton worked at Merrill Lynch and Allen & Company before starting his own fund. Chilton is the chairman and CEO of the Chilton Investment Company. The hedge fund invests primarily in equities.
Chilton has made a name for himself as a hedge fund manager focused on value-oriented, fundamental research, and disciplined portfolio management. Chilton Investment Company has returned 32.99% over the past four quarters. In the first quarter of the year, the hedge fund was up 9.78%. Its market value increased to $3.6 billion in the first quarter, up from $3.5 billion as of the end of 2020.
As of the end of the first quarter, Chilton Investment Company has a significant holding in Microsoft Corporation (NASDAQ: MSFT). The hedge fund run by Richard Chilton owns 1 million shares in the company worth over $236.92 million, representing 6.51% of their investment portfolio. Chilton Investment reduced stake in Microsoft Corporation (NASDAQ: MSFT) by 11% in the last quarter. On June 2, Morgan Stanley tied up with Microsoft to speed up the bank's IT environment. This will boost customers, employee, and designer experiences. There were 251 hedge funds in our database that held stakes in Microsoft Corporation (NASDAQ: MSFT) at the end of the first quarter of 2021, compared to 258 funds in the fourth quarter of 2020. Fisher Asset Management is the company’s most significant stakeholder, with 23.99 million shares worth $5.66 billion.
Another stock in Chilton's portfolio is Amazon.com, Inc. (NASDAQ: AMZN). Chilton Investment holds 420 shares in the firm worth over $1.30 million. On April 5, the stock was upgraded at Evercore to “Outperform.” The firm set a price target of $4,000.00. At the end of the first quarter of 2021, 243 hedge funds in the database of Insider Monkey held stakes worth $50.42 billion in Amazon.com, Inc. (NASDAQ: AMZN), down from 273 the preceding quarter worth $51.53 billion.
Chilton Investment also holds 48,211 shares in Apple Inc. (NASDAQ: AAPL), worth over $5.89 million, representing 0.16% of their portfolio. Chilton’s hedge fund increased its stake in the company by 4% in the first quarter. The company announced that Apple Inc. (NASDAQ: AAPL) Podcasts subscriptions will be rolled out globally on June 15.
But in this article our focus would be on dividend-paying stocks in Chilton's Q1 portfolio.
Richard Chilton of Chilton Investment Company
Chilton is an exception in an industry reeling from losses. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey's research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26, 2021, our monthly newsletter's stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017, and they lost 13% through November 16. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Best Dividend Stocks to Buy According to Billionaire Richard Chilton
10. The First of Long Island Corporation (NASDAQ: FLIC)
Chilton’s Stake Value: $2,998,000 Percentage of Richard Chilton’s 13F Portfolio: 0.08% Dividend Yield: 3.38% Number of Hedge Fund Holders: 8
The First of Long Island Corporation (NASDAQ: FLIC) functions as a closed-end investment company for The First National Bank of Long Island. The company provides financial services to small and medium-sized enterprises, customers, and other establishments. It was founded in 1927 and is placed tenth on our list of 10 best dividend stocks to buy according to billionaire Richard Chilton. The First of Long Island Corporation stock has returned more than 44% to investors over the course of the past twelve months.
Just like Apple Inc. (NASDAQ: AAPL), Amazon.com, Inc. (NASDAQ: AMZN) and Microsoft Corporation (NASDAQ: MSFT), The First of Long Island Corporation is one of the best stocks to buy according to billionaire Richard Chilton. The First of Long Island Corporation (NASDAQ: FLIC) declared a quarterly dividend of $0.19 per share on February 25, in line with the previous. The forward yield was 3.42%. The company posted Q1 2021 results on April 29 and reported revenue of $29.43 million, up 5.1% YoY, beating the estimates by $0.61 million.
Chilton Investment Company holds 141,074 shares in the company worth over $3 million. Out of the hedge funds being tracked by Insider Monkey, New York-based investment firm Renaissance Technologies is a leading shareholder in The First of Long Island Corporation (NASDAQ: FLIC) with 720,181 shares worth more than $15 million.
9. Merck & Co., Inc. (NYSE: MRK)
Chilton’s Stake Value: $10,198,000 Percentage of Richard Chilton’s 13F Portfolio: 0.28% Dividend Yield: 3.59% Number of Hedge Fund Holders: 79
Merck & Co., Inc. (NYSE: MRK) is a leading healthcare company in the world. It was incorporated in 1891 and is ranked ninth on our list of 10 best dividend stocks to buy according to billionaire Richard Chilton. Merck & Co., Inc. (NYSE: MRK) shares have gained about 3% over the last 12 months.
Last week, MSD Animal Health, a division of Merck & Co., Inc. (NYSE: MRK), bought LIC Automation from Livestock Improvement Corporation to broaden its index, with interdependent products and machinery, for their customers. On May 25, the company declared a dividend of $0.65 per share in line with the previous. The forward yield was 3.41%.
Chilton Investment holds 132,293 shares in the company worth over $10.20 million, representing 0.28% of their portfolio. At the end of the first quarter of 2021, 79 hedge funds in the database of Insider Monkey held stakes worth $6.5 million in Merck & Co., Inc. (NYSE: MRK), down from 82 the preceding quarter worth $7.2 million. Warren Buffett’s Berkshire Hathaway is the company’s most significant stakeholder, with 17.88 million shares worth $1.38 billion.
Just like AbbVie Inc. (NYSE: ABBV), Pfizer Inc. (NYSE: PFE), Apple Inc. (NASDAQ: AAPL), Amazon.com, Inc. (NASDAQ: AMZN) and Microsoft Corporation (NASDAQ: MSFT), Merck & Co., Inc. (NYSE: MRK) is one of the best stocks to buy according to billionaire Richard Chilton.
In its Q1 2021 investor letter, Artisan Partners, an independent investment management firm, highlighted a few stocks, and Merck & Co., Inc. was one of them. Here is what the fund said:
“In Q1, we initiated a position in Merck & Co., Inc. (NYSE: MRK), a provider of health care solutions including prescription medicines, vaccines, biologic therapies, animal health and consumer care products. We purchased Merck when the stock came under pressure in part on concerns that the newly minted Biden administration could implement regulatory changes and lower drug costs in the pharmaceutical industry. Recent, but anticipated changes to Merck & Co., Inc. (NYSE: MRK)’s management team have also weighed on shares, as have concerns over the company’s heavy reliance on immunotherapy treatment Keytruda. Notably, Merck is not getting much credit from investors for the 60+ programs it has in clinical development, despite having several solid and large new product opportunities. Additionally, the company’s strong balance sheet and robust free cash flow provide it multiple options for future partnerships and acquisitions. While Merck & Co., Inc. (NYSE: MRK) is undergoing a period of transition, we think the company's fundamentals are strong and believe changes to management should be a catalyst for improvement."
8. Huntington Bancshares Incorporated (NASDAQ: HBAN)
Chilton’s Stake Value: $735,000 Percentage of Richard Chilton’s 13F Portfolio: 0.02% Dividend Yield: 3.94% Number of Hedge Fund Holders: 27
Huntington Bancshares Incorporated (NASDAQ: HBAN) is a regional bank corporation. The company's affiliates provide banking services, bank loans, vehicle financing, money management, personalized insurance service programs, and other fiscal products and services. It was founded in 1866 and is ranked eighth on our list of 10 best dividend stocks to buy according to billionaire Richard Chilton. Huntington Bancshares Incorporated (NASDAQ: HBAN) currently has a $21.37 billion market capitalization and was able to deliver a 46.69% return in the past 12 months.
On April 22, Huntington Bancshares Incorporated (NASDAQ: HBAN) announced a Q1 2021 dividend of $0.15 per share, in line with the previous. The revenue over the period was $1.37 billion, up 18.1% YoY, beating the estimates by $150 million. The forward yield was 4.15%.
The hedge fund managed by Chilton owns 46,733 shares in the bank holding company worth over $735,000. At the end of the first quarter of 2021, 27 hedge funds in the database of Insider Monkey held stakes worth $154 million in Huntington Bancshares Incorporated (NASDAQ: HBAN), down from 29 the preceding quarter worth $88 million.
7. Pfizer Inc. (NYSE: PFE)
Chilton’s Stake Value: $212,000 Percentage of Richard Chilton’s 13F Portfolio: 0.001% Dividend Yield: 4.02% Number of Hedge Fund Holders: 65
Pfizer Inc. (NYSE: PFE) is one of the biggest pharmaceutical companies in the world. It was incorporated in 1849 and is ranked seventh on our list of 10 best dividend stocks to buy according to billionaire Richard Chilton. Shares of the company rallied 25.63% in the last 12 months, resulting in a $224.75 billion market capitalization.
Just like Apple Inc. (NASDAQ: AAPL), Amazon.com, Inc. (NASDAQ: AMZN) and Microsoft Corporation (NASDAQ: MSFT), Pfizer Inc. (NYSE: PFE) is one of the best stocks to buy according to billionaire Richard Chilton. A few days back, the FDA gave a nod to Pfizer's Prevnar20 (Pneumococcal 20-valent Conjugate Vaccine) that prevents infectious disease and pneumonia. On May 4, the company declared Non-GAAP earnings per share of $0.93 for Q1 2021, beating market prediction by $0.15. The company also posted its first quarter revenue of $14.6 billion, up 44.8% YoY, beating estimates by $980 million.
As of the end of the first quarter of 2021, Chilton Investors holds $212,000 worth of Pfizer Inc. (NYSE: PFE) shares. At the end of the first quarter of 2021, 65 hedge funds in the database of Insider Monkey held stakes worth $2.01 billion in Pfizer Inc. (NYSE: PFE), up from 63 the preceding quarter worth $1.85 billion.
ClearBridge Investments, in its Q1 2021 investor letter, mentioned Pfizer Inc. Here is what ClearBridge Investments has to say about Pfizer Inc. in its letter:
“Our underweights in health care and staples contributed to relative performance during the period. As we continue to focus the portfolio on high-conviction ideas, we sold Pfizer Inc. (NYSE: PFE) in late 2020, in the health care sector.”
6. AbbVie Inc. (NYSE: ABBV)
Chilton’s Stake Value: $798,000 Percentage of Richard Chilton’s 13F Portfolio: 0.02% Dividend Yield: 4.63% Number of Hedge Fund Holders: 72
AbbVie Inc. (NYSE: ABBV) is a major pharmaceutical company. It was founded in 2012 and ranks sixth on our list of 10 best dividend stocks to buy according to billionaire Richard Chilton. AbbVie currently has a $203.86 billion market capitalization and was able to deliver a 24.41% return in the past 12 months.
On June 7, AbbVie Inc. (NYSE: ABBV) announced that its drug RINVOQ got approval from Health Canada. The medicine will be used for the treatment of active psoriatic arthritis that causes acute pain. Earlier in February, the company declared its annual dividend of $1.30 per share, in line with the previous. The forward yield is 4.51%. Last month, AbbVie Inc. (NYSE: ABBV) announced its Q1 2021 financial results, showing revenue rising 50.95% year-over-year, valued at over $13 billion, beating the market prediction by $160.24 million.
Chilton Investors holds 7,375 shares in the company worth over $798,000. Chilton has trimmed stakes in AbbVie Inc. (NYSE: ABBV) by 24% in the past few months. Legendary investor and billionaire Warren Buffett’s Berkshire Hathaway is the biggest stakeholder in AbbVie Inc. (NYSE: ABBV). The Oracle of Omaha owns 22.8 million shares of the company, worth $2.47 billion.
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Disclosure: None. 10 Best Dividend Stocks to Buy According to Billionaire Richard Chilton is originally published on Insider Monkey.
