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Bill Gates’ 10 Dividend Stocks

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·12 min read
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In this article, we discuss the best dividend stocks according to Bill Gates. You can skip our detailed analysis of Bill Gates' investment philosophy and go directly to read Bill Gates' 5 Dividend Stocks.

William Henry Gates, more commonly known as Bill Gates, is an American businessman, investor, software developer, author, philanthropist, and the founder of the global tech giant, Microsoft Corporation. His fund, Bill & Melinda Gates Foundation, which is managed by Michael Larson, invests billions every year to address major issues, such as poverty and disease. The Gates Foundation was founded in 2000 as the merger of two previous charitable organizations. The fund has an endowment of over $50 billion.

Climate and clean energy have been gaining Gates’ attention in the recent past. His non-profit organization, Breakthrough Energy, which was founded in 2016, has focused on investments in the companies that aim to fight climate change.

As of Q2 2021, Bill & Melinda Gates Foundation invests heavily in industrial goods and finances, making up 30.6% and 50.8% of the portfolio, respectively. Berkshire Hathaway (NYSE:BRK.A) makes up 100% of the fund’s finance sector. The hedge fund has over $23.8 billion assets under management and the portfolio value grew by 1.14% when compared with the previous quarter.

Dividend stocks represent a sizeable portion of Gates’ 13F portfolio. The hedge fund did not make any new investments in the second quarter. Some of the notable stocks in Gates’ foundation portfolio include Berkshire Hathaway (NYSE:BRK.A), Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF), Caterpillar Inc. (NYSE:CAT), Walmart Inc. (NYSE:WMT), and Alphabet Inc. (NASDAQ:GOOG).

However, in this article, we lay our focus on dividend-paying stocks in Bill Gates’ portfolio.

Our Methodology:

Let's analyze our list of the best dividend stocks according to Bill Gates. The companies mentioned below are the stocks included in Bill Gates' 13F portfolio that pay dividends.

Bill Gates' X Dividend Stocks
Bill Gates' X Dividend Stocks

Bill Gates

Why pay attention to hedge fund sentiment while choosing stocks?

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Bill Gates' 10 Dividend Stocks

10. Grupo Televisa, S.A.B. (NYSE:TV)

Bill & Melinda Gates’ Stake Value: $241,035,000

Percent of Bill & Melinda Gates’ 13F Portfolio: 1%

Number of Hedge Fund Holders: 17

Dividend Yield: 0.70%

Grupo Televisa, S.A.B. (NYSE:TV) stands tenth on our list of Bill Gates’ 10 dividend stocks. It is a Mexican multimedia and mass media company that mainly produces content in Spanish. The company has headquarters in Mexico City, Mexico.

As of Q2 2021, the Gates Foundation holds over 16.8 million shares in Grupo Televisa, S.A.B. (NYSE:TV), valued at over $241 million. The company accounts for 1% of the hedge fund’s 13F portfolio. This July, Benchmark initiated its coverage on Grupo Televisa, S.A.B. (NYSE:TV) with a ‘Buy’ rating and a $19 price target. The firm’s analyst appreciated the company’s 5% revenue growth in Q2, driven massively by the recovery in the advertising segment.

On May 26, the company’s board announced a quarterly dividend of $0.078 per share, yielding 0.70%. In the past year, the stock has delivered a 58.2% return to shareholders, while its year-to-date returns stood at 37.7%.

As of Q2 2021, 17 hedge funds tracked by Insider Monkey have positions in Grupo Televisa, S.A.B. (NYSE:TV), up from 15 in the previous quarter. The total value of these stakes is over $1.1 billion.

Like Berkshire Hathaway (NYSE:BRK.A), Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF), Caterpillar Inc. (NYSE:CAT), Walmart Inc. (NYSE:WMT), and Alphabet Inc. (NASDAQ:GOOG), Grupo Televisa, S.A.B. (NYSE:TV) is also one of the notable stocks in Bill Gates’ portfolio.

Oakmark Funds mentioned Grupo Televisa, S.A.B. (NYSE:TV) in its Q2 2021 investor letter. Here is what the firm has to say:

“Grupo Televisa, a media company headquartered in Mexico and the world’s largest producer of Spanish-language content, was a top contributor for the second quarter. Grupo Televisa’s share price jumped when the company revealed that it would merge its content and media assets with Univision. In a call with shareholders, CEO of Televisa, Alfonso de Angoitia, and CEO of Univision, Wade Davis, provided details on the $4.8 billion agreement, which combines these leading media businesses in the two largest Spanish-speaking markets in the world. Overall, we think the deal makes strategic sense as streaming is the future in television, and the new company will very likely become the dominant Spanish-language streaming service. There will also be synergies from combining the two businesses, which should improve profitability versus when they were stand-alone businesses. In addition, over the long term, we believe consolidation in the media sector will continue, providing an opportunity for the new entity to partner with a larger company. Aside from the strategic merits, we believe Televisa received an attractive valuation for its content business as the $4.8B value was higher than our internal estimates. We commend management for this transaction.”

9. Ecolab Inc. (NYSE:ECL)

Bill & Melinda Gates’ Stake Value: $899,353,000

Percent of Bill & Melinda Gates’ 13F Portfolio: 3.76%

Number of Hedge Fund Holders: 48

Dividend Yield: 0.89%

Ecolab Inc. (NYSE:ECL) is an American food safety company that mainly offers services in water, hygiene, and energy technologies. The company’s products and programs are widely used by restaurants, schools, hotels, and commercial facilities. It ranks ninth on our list of Bill Gates’ 10 dividend stocks.

In Q2 2021, Gates Foundation increased its activity in Ecolab Inc. (NYSE:ECL) by 1% and now holds approximately 4.4 million shares in the company, valued at $899.3 million. The company represents 3.76% of the fund’s 13F portfolio.

In Q2 2021, Ecolab Inc. (NYSE:ECL) posted an EPS of $1.22, in-line with the analysts’ estimates. The company pays an annual dividend of $1.92 per share, yielding 0.89%. Ecolab Inc. (NYSE:ECL) has a track record of 36 years of dividend growth with a dividend payout ratio of 47.76%. This September, RBC Capital initiated its coverage on Ecolab Inc. (NYSE:ECL) with an ‘Outperform’ and a $260 price target. The stock returned 5.86% in the past year.

Of the 873 hedge funds tracked by Insider Monkey, 48 hedge funds have positions in Ecolab Inc. (NYSE:ECL) in Q2 2021, up from 42 in the previous quarter. These stakes are valued at $2.7 billion.

Like Berkshire Hathaway (NYSE:BRK.A), Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF), Caterpillar Inc. (NYSE:CAT), Walmart Inc. (NYSE:WMT), and Alphabet Inc. (NASDAQ:GOOG), Ecolab Inc. (NYSE:ECL) is gaining investors’ attention in 2021.

8. FedEx Corporation (NYSE:FDX)

Bill & Melinda Gates’ Stake Value: $445,619,000

Percent of Bill & Melinda Gates’ 13F Portfolio: 1.86%

Number of Hedge Fund Holders: 61

Dividend Yield: 1.34%

FedEx Corporation (NYSE:FDX) stands eighth on our list of Bill Gates’ 10 dividend stocks. It is an American company that focuses on transportation and other related business services.

In Q2 2021, Gates Foundation did not make any changes to its activity in FedEx Corporation (NYSE:FDX). The hedge fund holds 1.4 million shares in the company, valued at $445.6 million. The company represents 1.86% of the fund’s 13F portfolio. Recently, FedEx Logistics, a subsidiary of FedEx Corporation (NYSE:FDX), inaugurated new offices in South Korea to support its latest growth strategy to expand into countries with solid economies.

The company has increased its dividend by 36.84% in the past three years and currently pays an annual dividend of $3.00 per share, yielding 1.34%. This September, UBS Group set a $369 price target on FedEx Corporation (NYSE:FDX), with an ‘Overweight’ rating on the shares.

As of Q2 2021, 61 hedge funds tracked by Insider Monkey have positions in FedEx Corporation (NYSE:FDX), compared with 63 in the previous quarter. These stakes are valued at over $2.1 billion.

Like Berkshire Hathaway (NYSE:BRK.A), Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF), Caterpillar Inc. (NYSE:CAT), Walmart Inc. (NYSE:WMT), and Alphabet Inc. (NASDAQ:GOOG), FedEx Corporation (NYSE:FDX) is on investors’ radar in 2021.

Artisan Partners mentioned FedEx Corporation (NYSE:FDX) in its Q1 2021 investor letter. Here is what the firm has to say:

“Whatever products did make it off the line met a constrained logistics infrastructure, with commercial air capacity cut and ship cargo space at a premium. Then, in the event your dishwasher part actually made it to US waters, our ports were congested due to manpower shortages and COVID-19 protocols. When the goods were finally unloaded, it turns out trucking shortages caused a spike in ground rates! All this might be bad for your dinner parties, home décor or exercise goals, but it can be great for the middlemen. Middlemen like logistics expert FedEx.

FedEx provides global logistics services. It gets your dishwasher part on a truck, or that semiconductor chip on a plane. Surging demand for at-home deliveries during the pandemic boosted volumes and allowed management to push through price increases, keeping competitive with industry peers. The industry’s renewed pricing discipline was a welcome change, reflecting a broader commitment to earn better returns on invested capital. Despite a significant re-rating of the business over the last 12 months, FedEx remains attractive based on our margin of safety criteria.”

7. Walmart Inc. (NYSE:WMT)

Bill & Melinda Gates’ Stake Value: $1,071,852,000

Percent of Bill & Melinda Gates’ 13F Portfolio: 4.49%

Number of Hedge Fund Holders: 71

Dividend Yield: 1.58%

Walmart Inc. (NYSE:WMT) is an American retail company that involves in retail and wholesale businesses. The company’s segments manage supermarkets, hypermarkets, and cash and carry. It ranks seventh on our list of Bill Gates’ 10 dividend stocks.

As of Q2 2021, Gates Foundation holds over 7.6 million shares in Walmart Inc. (NYSE:WMT), valued at over $1.07 billion. The company accounts for 4.49% of the hedge fund’s 13F portfolio. This August, Tigress Financial lifted its price target on Walmart Inc. (NYSE:WMT) to $170, while keeping an ‘Overweight’ rating on the shares. The firm’s analyst appreciated the company’s strong business across all segments which paves way for significant growth in share price.

In Q2 2021, Walmart Inc. (NYSE:WMT) posted an EPS of $1.78, beating the estimates by $0.21. The company pays an annual dividend of $2.20 per share, yielding 1.58%.

Walmart Inc. (NYSE:WMT) has a track record of 45 years of consistent dividend growth.

As of Q2 2021, the number of hedge funds having stakes in Walmart Inc. (NYSE:WMT) grew to 71, from 58 in the previous quarter. The total value of these stakes is over $8 billion. Fisher Asset Management is the company’s leading shareholder, with 12.6 million shares.

In addition to Berkshire Hathaway (NYSE:BRK.A), Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF), Caterpillar Inc. (NYSE:CAT), and Alphabet Inc. (NASDAQ:GOOG), hedge funds are paying attention to Walmart Inc. (NYSE:WMT) in 2021.

ClearBridge Investments mentioned Walmart Inc. (NYSE:WMT) in its second-quarter 2021 investor letter. Here is what the firm has to say:

“The pandemic has created challenges for businesses large and small; one major challenge for large essential retailers such as ClearBridge holdings Home Depot, Walmart and Costco has been ensuring adequate staffing to meet demand under trying conditions. All three instituted enhanced pay practices during the pandemic, with raises, unplanned bonuses and other benefits helping compensate employees for their efforts in a difficult environment. In September 2020 Walmart raised wages for 165,000 employees, including a number of entry positions to $15 an hour. It followed this in February with a raise for 425,000 workers that moved its average pay above $15 an hour.”

6. Canadian National Railway Company (NYSE:CNI)

Bill & Melinda Gates’ Stake Value: $1,467,747,000

Percent of Bill & Melinda Gates’ 13F Portfolio: 6.15%

Number of Hedge Fund Holders: 40

Dividend Yield: 2.4%

Canadian National Railway Company (NYSE:CNI) stands sixth on our list of Bill Gates’ 10 dividend stocks. It is a Canadian Class 1 freight railway with a 20,000-mile network that spans Canada and mid-America.

In Q2 2021, Gates Foundation did not change its position in the Canadian National Railway Company (NYSE:CNI). The hedge fund owns 13.9 million shares in the company, valued at $1.4 billion. The company accounts for 6.15% of the hedge fund’s 13F portfolio.

This September, Scotiabank lifted its price target on Canadian National Railway Company (NYSE:CNI) to C$160, while keeping an ‘Outperform’ rating on the shares. In Q2 2021, the company posted an EPS of C$1.49, beating the estimates by C$0.01. On July 20, the Canadian National Railway Company (NYSE:CNI) announced a quarterly dividend of $0.615 per share, offering an annualized yield of 2.4%. The company’s dividend payout ratio stood at 48.99%.

As of Q2 2021, the number of hedge funds tracked by Insider Monkey having stakes in Canadian National Railway Company (NYSE:CNI) grew to 40, compared with 36 in the previous quarter. These stakes are valued at over $5.3 billion.

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Disclosure. None. Bill Gates' 10 Dividend Stocks is originally published on Insider Monkey.