3 Dividend Stocks the Experts are Buying Now


I’ve found three high yielding dividend
stocks with huge buying by institutional and activist investors. In fact, one stock saw over $2 billion in
buying over the last quarter. I’ll show you how to find these big money
targets and reveal these three stocks today on Let’s Talk Money. Beat debt. Make money. Make your money work for you. Creating the financial future you deserve. Let’s talk money. Joseph Hogue with the Let’s Talk Money channel
here on YouTube. I want to send a special shout out to everyone
in the community, thank you for taking a little of your time to be here today. If you’re not part of the community yet,
just click that little red subscribe button. It’s free and you’ll never miss an episode. One of the best ways to pick stocks for your
portfolio is by following the big hedge funds, institutional buyers and activist investors
like Carl Icahn. These multi-billion dollar funds have to disclose
their stocks every quarter so it’s a great look into what investments they like and trends
in the stock market. This is important for a couple of reasons. First is just the sheer dollar-volume investment
from these funds can drive a stock higher. We’re talking hundreds of millions of dollars
here so it can really drive momentum in a stock. In fact, a friend of mine from my analyst
days, his whole job is setting up computer programs that track these big inflows into
a stock to make money off that momentum. More importantly though is most of these funds
invest on a fundamental basis, looking deeply at a company’s financials and competitive
advantage. The portfolio managers at these funds have
teams of analysts working sixty and eighty hours a week pouring over cash flow models. That’s what I did, creating those models
and finding the undervalued stocks. So while I still say you need to do some of
your own research to make sure a stock is right for your portfolio, if an institutional
investor is building a position then it’s probably for a very good reason. I’ve been so busy tracking our 2019 dividend
stocks portfolio, up over 20% so far this year, that I haven’t looked at what the
funds are buying lately. I looked to my old sources and found three
solid dividend stocks that are getting some big money interest and that could be great
additions to your portfolio. I’m first going to show you how to find
these stocks with big money buying and then reveal those three dividend investments to
watch. I’ll leave an index in the video description
to where we talk about those three stocks to buy but watch this first walk-through. It’s not enough to get those stock picks,
you want to know how to find more yourself. One warning though while you’re using this
strategy. That form that the hedge funds and big money
players are required to submit, it’s called the 13F for institutional investors and the
13D which is filed by activist investors and anyone with more than 5% of a company’s
shares. The warning here is that these are always
filed for investments in the previous quarter or at least with a ten-day lag for the 13D,
so they are a little dated. Usually though, what we see is an institutional
buyer will build their position over at least a few quarters so it’s not like they’re
trading in and out of these stocks. Let’s look at where you can find these big
money players and find stocks that could be getting that big money boost. A good place to start is on the Nasdaq site
and you can enter a company name or ticker here in the search box to go to its profile
page. Now there’s a lot of good info available
but if you scroll down and click on institutional holdings, this will show you all the funds
and big institutional investors with a position. First you’ll see the percentage of shares
outstanding that are held by these big money players so we see here that funds and institutions
own about 58% of all stock available for The Gap. That’s pretty typical for these large, established
companies. You usually see anywhere from 50% to even
90% held by funds because these stocks are in all kinds of index funds like the S&P and
dividend funds. Scroll down a little further and you’ll
see changes in holdings and what I like to look at is this new positions vs sold positions. This gives you a good idea of the net interest
in a stock over the last quarter. So we see that there was huge new buying in
The Gap, almost triple the buying in the shares versus selling. You can also scroll down further and see which
funds hold the most shares and which added or sold the most in the last quarter. Most of the biggest institutional investors
are going to be the fund managers, so the people that put together the ETFs and mutual
funds that hold these stocks. That’s why you see Vanguard and Blackrock
almost always at the top. When you’re looking here, you want to look
for the hedge funds, so the non-ETF institutional investors and the activist investors. They’re the ones that are really moving
a stock through buying and selling. Understand that these institutional investors
and activists aren’t infallible. Even Warren Buffett has taken a hit on investments
like IBM and has even called his holding company Berkshire Hathaway, the dumbest stock he ever
bought. The point is that you have to do your own
research as well when you find these stocks with big institutional investors buying. I talk about the five investing strategies
I use in another video and I’ll link to that later here because it’s a great combination
with this strategy. So I looked into the biggest institutional
buying for stocks to buy. You know I’m all about dividend stocks this
year so I put the strategy to the test, digging into my old sources, and found three good
dividend investments that are getting lots of big money interest. The Gap, ticker gps, of course is the $10
billion retailer that owns Old Navy, Banana Republic and its flagship brand. The company sells online and through about
3,200 stores internationally though 80% of sales comes from the U.S. The stock pays a solid 3.8% dividend yield
but apparel retailers have been struggling for more than a year now. The company has been shedding underperforming
stores and cutting costs but just hasn’t been able to get a break against higher costs
and weak demand. The stock jumped 16% early March when the
company announced that it would be spinning off the Old Navy brand. Investors will get shares in both companies,
Old Navy and then the new company holding Gap, Athleta and Banana Republic. The idea is that separately the companies
can focus better on getting out the right fashions at the right time and managing costs. The shares have come back down on fears about
how they’ll pull it off but there’s been some real institutional investor buying here
and I think some solid value. Unigestion Holdings is a $23 billion hedge
fund manager out of Geneva with two-thirds of its clients from either pension or insurance
investors so an eye towards safety. It added $49 million to its position in the
company last quarter. Kempner Capital is a $31 billion independent
advisor with a deep-value approach and a 3-5 year holding period and added $27 million
to its position in the Gap. Analysts expect earnings to fall by almost
5% to $2.47 per share over the next year but the company has a great track record of beating
estimates. Even on the lower earnings, the shares still
trade for just 10-times earnings. My sum-of-parts valuation puts the shares
around $30 each or higher and I think the individual shares of the new companies could
go higher on investor sentiment even before the spinoff happens. Like I said, retail apparel has been hit hard
over the last couple of years and I’d like to go into the factors and maybe some turning
points you can look for. If you’d like to see a video about different
sectors or industries of the economy and the factors driving stocks, let me know in the
comments below the video. Next, Huntington Bancshares (HBAN) is a regional
bank with 945 branches across eight states in the upper Midwest from Illinois across
to Pennsylvania. The shares pay a great 4% dividend yield and
the bank has really advanced its move into online service which is helping to boost profitability. Boston Partners added over $211 million to
its position in Huntington last quarter and nearly 80% of the shares are owned by big
money players. Boston is an $81 billion value and long/short
manager and won the 2018 Lipper Fund award for its long/short equity fund. Banking has struggled over the last year on
lower long-term interest rates as those short-term rates they pay out on deposits increases on
Fed rate hikes. That means lower profitability but they could
see some relief through the rest of the year. Analysts see earnings jumping 12% to $1.37
per share over the next year which means the bank is trading on that 10-times price to
earnings multiple I like to find. We’ve got one more dividend stock and this
one has gotten more big money interest than the other two combined. If you like the video so far though, please
tap the thumbs up button below so I know to make more of these stock pick videos. W.P. Carey (WPC) is $17 billion real estate
investment trust paying a 5.4% dividend yield. The REIT is one of the few with geographic
diversification, about a third of properties are in Europe and is fairly well diversified
across property types with office space, retail and self-storage offsetting the 43% holdings
in industrial and warehouse. The company collects over $1.1 billion in
annualized base rent and books 98% occupancy over 131 million square feet across more than
1,100 properties. Of the three dividend stocks, this is the
one that’s seen the biggest institutional investor buying with over $2 billion added
last quarter. Geode Capital Management is $388 billion multi-strategy
asset manager founded in 2001. Centersquare is a $9 billion real estate asset
manager in listed shares, private equity and infrastructure. The fund has almost 30 years investing and
managing real estate assets so it’s a big vote of confidence that it put on this new
position in WP Carey. WP Carey has topped expectations for funds
from operations over the last four quarters, reporting an FFO of $6.37 last year. Remember as we talked about in our REITs and
MLPs video, you can’t use regular earnings or price-to-earnings for these stocks because
of that huge depreciation charge they book. So that $6.37 in funds from operations gives
is a 12-times price to FFO multiple which is just under the REIT industry average around
14-times. Don’t forget to check out that 5 investing
strategies video, I’ll leave a link in the video description below and a card here in
the corner of the screen. These are some great investing strategies
to combine with following institutional investors and activist investors so check that out. We’re here Mondays, Wednesdays and Fridays
with the best videos on beating debt, making more money and making your money work for
you. If you’ve got a question about money, just
subscribe to the channel and ask it in the comments and we’ll answer it in a video.

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