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We love high dividend stocks and consider them as one of the best options for conservative investors. We don’t like Fed’s inflationary monetary policy and Federal government’s huge budget deficits. We think high dividend yielding stocks will perform much better than the 10-year treasuries over the next 10 years.

One of the ways of picking the best dividend stocks is to invest in what prominent hedge funds like. Insider Monkey tracks more than 300 hedge funds that mostly use fundamental analysis to make investment decisions. We look for at least a 4% dividend yield and $5 Billion in market cap. Here are the 30 dividend monsters that hedge funds love the most:

Company Name

Symbol

Dividend Yield

No. Hedge Fund Holding

PFIZER INC

PFE

4.5

75

SANOFI

SNY

5.0

64

BP PLC

BP

4.4

44

MERCK

MRK

4.9

40

INTEL

INTC

4.3

40

VODAFONE

VOD

5.4

35

LOCKHEED MARTIN

LMT

4.3

34

CONOCOPHILLIPS

COP

4.2

34

BRISTOL-MYERS SQUIBB

BMY

4.7

33

PETROBRAS

PBR

4.6

33

TRANSOCEAN LTD

RIG

6.3

30

ELI LILLY

LLY

5.5

29

VERIZON

VZ

5.6

29

RAYTHEON

RTN

4.3

27

AT&T INC

T

6.0

25

INTERNATIONAL PAPER

IP

4.5

25

ANNALY CAPITAL

NLY

14.4

24

ALTRIA GROUP INC

MO

5.9

24

CENTURYLINK INC

CTL

8.5

23

PPL CORP

PPL

5.2

21

NOVARTIS AG

NVS

4.3

21

SOUTHERN COPPER

SCCO

7.4

20

FIRSTENERGY CORP.

FE

5.3

20

KINDER MORGAN

KMI

5.1

20

LORILLARD INC

LO

4.8

20

KIMBERLY-CLARK

KMB

4.3

20

YPF

YPF

8.6

19

REYNOLDS AMERICAN

RAI

5.9

19

EXELON CORP

EXC

5.0

19

PG&E CORP

PCG

4.4

18

As you can see, an enormous number of hedge funds own Pfizer. David Einhorn's Greenlight Capital owns the most, with $483 Million. He's followed by Fisher Asset Management's $452 Million, Maverick Capital's $410 Million, and Appaloosa Management's $300 Million (see David Tepper's hot stock picks).

Ken Fisher's Fisher Asset Management takes the top spot with the next stock on the list. As of the end of June, the fund had nearly $600 Million in Sanofi Aventis (see Ken Fisher's top stock picks). Sanofi Aventis has a dividend yield of 5%. Warren Buffett's Berkshire Hathaway comes in second with $163 Million.

Buffett does take the lead with ConocoPhillips, having about five times the amount of shares as the next guy. COP has a dividend yield of 4.2%, and Berkshire Hathaway had about $2.8 Billion in the stock at the end of June. In the second quarter, they invested $600 Million in the stock, making it Buffett's largest purchase that quarter (check out Warren Buffett's top stock picks).

We think a portfolio of these 30 stocks will provide ample diversification for investors and their high dividend yields will deliver better returns that long-term treasury bonds. Another important point about investing in these stocks is that hedge funds don’t usually buy these for dividends, they buy these for capital gains. That’s why we also think these stocks will most likely deliver attractive returns through capital gains.



Disclosure: I am long FE, CTL, T, COP, VOD.

Source: 30 Dividend Monsters That Hedge Funds Love The Most