In this article, we discuss 11 high-dividend stocks picked by billionaire Ray Dalio. You can skip our detailed analysis of Ray Dalio's hedge fund, and go directly to read 5 High-Dividend Stocks Picked By Billionaire Ray Dalio.
Ray Dalio is an American billionaire investor who founded Bridgewater Associates in 1975 in New York. He has a unique investment philosophy that is based on principles of radical transparency, meaningful work, and the importance of diversification. One of the core principles of Dalio's investment philosophy is the concept of "risk parity." This means that he believes that investors should allocate their portfolios based on the risks involved in each asset class, rather than on their historical returns. Through these strategies, Dalio built his firm into one of the world’s largest and most successful hedge funds. As of April 2023, the billionaire has a real-time net worth of $19.1 billion, according to Forbes.
In October 2022, Dalio handed over control of Bridgewater Associates to a new generation of investors and turned his majority stake over to the board. This team of investment professionals is mainly responsible for choosing stocks and making investment decisions. Dalio will remain the chief investment officer mentor and will maintain his position on the firm’s operating board of directors. Following this development, Dalio tweeted:
"Hopefully until I die, I will continue to be a mentor, an investor, and a board member at Bridgewater, because I and they love doing those things together."
Currently, Nir Bar Dea is serving as the chief executive officer of the firm. Under the new leadership, the hedge fund plans to expand its international footprint and develop artificial intelligence technologies. Earlier this year, the firm doubled its assets in China to over $2.93 billion, as reported by Reuters. Through this, Bridgewater becomes the biggest foreign hedge fund in the country. The firm launched its China fund in 2018 and delivered an annualized return of 15.6% through October 2022.
Throughout his career, Dalio focused on the current economic trends and talked about continuous interest rate hikes last year. He also recently spoke to Bloomberg about the wider implications of Silicon Valley Bank’s collapse. He said that this fallout would result in declining debt and credit markets. Here are some comments from the investors:
“It is likely that this bank failure will be followed by many more problems before the contraction phase of the cycle runs its course. We are approaching the turning point.”
Over the years, Bridgewater has delivered strong returns to shareholders. We previously reported that the firm’s flagship fund Pure Alpha II delivered an annual average return of 11.4% since its inception in 1991 through June 2022. The fund’s Pure Alpha also outperformed the market last year, gaining roughly 9.5%, compared with a 19.4% decline in the S&P 500.
As of the close of Q4 2022, Bridgewater Associates’ 13F portfolio had a value of over $18.3 billion, compared with $19.7 billion in the previous quarter. A majority of the companies in the portfolio are dividend payers and have rewarded shareholders with regular dividends. The Procter & Gamble Company (NYSE:PG), Johnson & Johnson (NYSE:JNJ), and PepsiCo, Inc. (NASDAQ:PEP) are some of the fund’s most important dividend holdings. However, we will discuss high-dividend stocks picked by billionaire Ray Dalio.
11 High-Dividend Stocks Picked By Billionaire Ray Dalio
Ray Dalio of Bridgewater Associates
Our Methodology:
For this list, we selected high dividend-paying stocks from the latest 13F portfolio of Bridgewater, where Dalio remains a mentor, board member and investor. The stocks mentioned below have dividend yields above 4%, as of April 10. The stocks are ranked in ascending order of their dividend yields.
High-Dividend Stocks Picked By Billionaire Ray Dalio
The Kraft Heinz Company (NASDAQ:KHC) is an American multinational food company that also specializes in a wide range of beverages. In February, Piper Sandler raised its price target on the stock to $43 and maintained a Neutral rating on the shares, highlighting the company's retail sales growth momentum.
On February 15, The Kraft Heinz Company (NASDAQ:KHC) declared a quarterly dividend of $0.40 per share, which fell in line with its previous dividend. The company is one of the best dividend stocks on our list as it has been making regular dividend payments to shareholders even before its merger in 2015. The stock has a dividend yield of 4.09%, as of April 10. The Procter & Gamble Company (NYSE:PG), Johnson & Johnson (NYSE:JNJ), and PepsiCo, Inc. (NASDAQ:PEP) are some other popular dividend stocks grabbing investors' attention.
At the end of Q4 2022, Bridgewater Associates owned over 2.1 million shares in The Kraft Heinz Company (NASDAQ:KHC), worth over $89 million. The company represented 0.48% of billionaire Ray Dalio's hedge fund portfolio.
As per Insider Monkey’s Q4 2022 database, 39 hedge funds held investments in The Kraft Heinz Company (NASDAQ:KHC), with a collective value of over $13.8 billion. In the previous quarter, 40 elite funds had stakes in the company, worth over $11.8 billion.
Agree Realty Corporation (NYSE:ADC) is an American real estate investment trust company that acquires retail properties on a net lease. It is one of the best dividend stocks on our list as it pays monthly dividends to shareholders and has raised its payouts for 11 years in a row. The company offers a monthly dividend of $0.24 per share and has a dividend yield of 4.31%, as of April 10.
Mizuho maintained a Neutral rating on Agree Realty Corporation (NYSE:ADC) in March with a $73 price target, presenting a conservative outlook on the sector.
At the end of the fourth quarter of 2022, Bridgewater Associates increased its stake in Agree Realty Corporation (NYSE:ADC) by 159% to a total of nearly $19 million. The company made up 0.1% of billionaire Ray Dalio's hedge fund portfolio.
At the end of December 2022, 21 hedge funds in Insider Monkey’s database owned stakes in Agree Realty Corporation (NYSE:ADC), compared with 26 in the previous quarter. These stakes have a consolidated value of over $371 million.
A New York-based investment banking company, Citigroup Inc. (NYSE:C) was the latest acquisition of Bridgewater Associates in the most recent quarter. The hedge fund started its position in the company with stakes worth over $58 million, which represented 0.31% of its 13F portfolio. It is among the best dividend stocks on our list.
In March, RBC Capital maintained an Outperform rating on Citigroup Inc. (NYSE:C) with a $51 price target, highlighting consistent interest rate hikes.
Citigroup Inc. (NYSE:C) currently pays a quarterly dividend of $0.51 per share and has a dividend yield of 4.45%, as recorded on April 10.
At the end of Q4 2022, 81 hedge funds tracked by Insider Monkey owned stakes in Citigroup Inc. (NYSE:C), compared with 85 in the preceding quarter. The collective value of these stakes is nearly $7.5 billion.
Diamond Hill Capital mentioned Citigroup Inc. (NYSE:C) in its Q1 2022 investor letter. Here is what the firm has to say:
“Shares of Citigroup declined in the quarter as investors became increasingly negative on capital markets activity. The company is also continuing to divest certain consumer banking geographies which may be dilutive to earnings in the near term.”
Realty Income Corporation (NYSE:O) is a California-based real estate investment trust company that pays monthly dividends to shareholders. In March, Stifel maintained a Buy rating on the stock with a $71 price target, appreciating the performance of the company's management.
Bridgewater Associates boosted its position in Realty Income Corporation (NYSE:O) at the end of Q4 2022 by 36%, which took its total O stake to over $37.3 million. The company represented 0.2% of billionaire Ray Dalio's hedge fund portfolio. The hedge fund has been investing in the company for over a decade now.
Realty Income Corporation (NYSE:O), one of the best dividend stocks, hiked its monthly dividend by 0.2% in March this year. This was the company's 29th consecutive year of dividend growth. The stock has a dividend yield of 4.89%, as of April 10.
At the end of Q4 2022, 24 hedge funds in Insider Monkey's database owned stakes in Realty Income Corporation (NYSE:O), down from 28 in the previous quarter. The collective value of these stakes is nearly $327 million. Among these hedge funds, Zimmer Partners owned the largest stake in the company worth over $111 million.
ConocoPhillips (NYSE:COP) is a Texas-based multinational company that specializes in hydrocarbon exploration and production. At the end of Q4 2022, Bridgewater Associates owned a COP stake worth over $30.3 million, which represented 0.16% of its 13F portfolio. The hedge fund started building its position in the company during the fourth quarter of 2010 with shares worth over $1.4 million.
ConocoPhillips (NYSE:COP) currently offers a quarterly dividend of $0.51 per share for a dividend yield of 5.03%, as of April 10. In February this year, the company also announced a variable return of cash of $0.60 per share, payable to shareholders on April 14. It is one of the best dividend stocks on our list as it has been making uninterrupted dividend payments to shareholders since 1993.
At the end of December 2022, 67 hedge funds tracked by Insider Monkey held stakes in ConocoPhillips (NYSE:COP), up from 64 in the previous quarter. These stakes have a consolidated value of roughly $3 billion.
ClearBridge Investments mentioned ConocoPhillips (NYSE:COP) in its Q4 2022 investor letter. Here is what the firm has to say:
“The risk-on environment supported by China reopening drove strong returns for the energy sector, despite underlying commodity prices falling from recent highs. In the portfolio, leading E&P company ConocoPhillips (NYSE:COP) was again among the top contributors; it maintains one of the best balance sheets in the industry and continues to execute well while benefiting from being a low-cost producer and growing liquefied natural gas demand. ConocoPhillips is also investing in field electrification and carbon capture across its portfolio, with ambitions to deliver oil production with industry-low CO2 intensity.”
6. International Business Machines Corporation (NYSE:IBM)
Dividend Yield as of April 10: 5.06%
Bridgewater Associates’ Stake Value: $28,666,043
A New York-based multinational tech company, International Business Machines Corporation (NYSE:IBM) ranks sixth on our list of the best dividend stocks. The company has been raising its dividends consistently for the past 27 years. It currently pays a quarterly dividend of $1.65 per share for a dividend yield of 5.06%, as of April 10.
At the end of Q4 2022, Bridgewater Associates increased its position in International Business Machines Corporation (NYSE:IBM) by 8%. The hedge fund's total IBM stake was worth over $28.6 million. The company represented 0.15% of billionaire Ray Dalio's portfolio. In addition to this, The Procter & Gamble Company (NYSE:PG), Johnson & Johnson (NYSE:JNJ), and PepsiCo, Inc. (NASDAQ:PEP) are some best dividend stocks in Dalio's hedge fund portfolio.
At the end of Q4 2022, 43 hedge funds tracked by Insider Monkey reported owning stakes in International Business Machines Corporation (NYSE:IBM), up from 40 in the previous quarter. These stakes have a collective value of $1.23 billion.
Diamond Hill Capital mentioned International Business Machines Corporation (NYSE:IBM) in its Q4 2022 investor letter. Here is what the firm has to say:
“New positions initiated in Q4 included shorts International Business Machines Corporation (NYSE:IBM), Acushnet Holdings (GOLF) and elf Beauty (ELF). Since diversified information technology company IBM’s 2019 acquisition of Red Hat, the company has aggressively pursued a hybrid cloud strategy. Though IBM and its new management team have made solid progress on this pivot, we believe the company still meaningfully lags the cloud hyperscalers and other cloud-native companies. Management has also laid out aggressive long-term targets for revenue growth and free cash flow, both of which we believe the company will struggle to achieve as it faces intense competition in its hybrid cloud business and structural headwinds in the company’s legacy businesses.”
