In this article, we discuss 11 best Fortune 500 dividend stocks to buy now. You can skip our detailed analysis of large-cap dividend stocks and their performance in the past, and go directly to read 5 Best Fortune 500 Dividend Stocks To Buy Now.
The Fortune 500 is an annual list compiled and published by Fortune magazine that ranks the top 500 publicly traded companies in the United States by their total revenue for their respective fiscal years. These companies are among the largest and most influential in the American economy. They span various industries, including technology, healthcare, finance, retail, energy, and more. Exxon Mobil Corporation (NYSE:XOM), Walmart Inc. (NYSE:WMT), and Amazon.com, Inc. (NASDAQ:AMZN) were the leading three companies on the Fortune 500 list. The top 10 companies combined made a massive $3.7 trillion in revenue in the list’s 69th year.
Large-cap companies often gain investors’ attention due to their established track record, stability, and market dominance. These companies are typically well-known, have a significant market presence, and operate across diverse industries. In addition to this, these companies are known for their perceived stability, relatively lower risk compared to smaller companies, and the potential for consistent returns. According to a report by CNBC, over the last twenty years, among various investment types, U.S. large-cap stocks delivered the most consistent returns, averaging 9.3%. Despite experiencing fluctuations in their value over time, these stocks outperformed other types of investments like small-cap stocks, international stocks, or bonds. While these alternative investments might have shown higher fluctuations or volatility in their prices, they didn’t surpass the steady and relatively strong performance of U.S. large-cap stocks. This means that even though large-cap stocks might have had their ups and downs, their overall returns were more reliable and profitable compared to other investment options during this period.
Also read: 12 Best Large Cap Stocks To Buy Now
Several reports have emphasized the importance of large-cap stocks in the past decade and what factors predominantly influenced their increased returns. In the last ten years, the significant surge in the performance of major technology companies has strongly impacted the returns of large-cap stocks. These tech giants experienced an incredible increase in their stock prices, collectively rising by approximately 160% during this period, as reported by J.P. Morgan. Innovative companies like Microsoft Corporation (NASDAQ:MSFT), Apple Inc. (NASDAQ:AAPL), and Amazon.com, Inc. (NASDAQ:AMZN) have dominated in their respective sectors, and the shift towards technology-driven solutions have greatly influenced the stock market.
In addition to tech giants, large-cap dividend stocks are also favored by investors as these stocks often belong to well-established companies with a history of stable earnings and cash flow. Their size and market position afford them the ability to consistently pay dividends, providing investors with a regular income stream, which is attractive, especially in uncertain market conditions. In this article, we will discuss some of the best large-cap stocks that pay dividends.
Photo by Ruben Sukatendel on Unsplash
Our Methodology:
For this article, we began by reviewing the current Fortune 500 list and specifically identified dividend-paying stocks among these companies. Next, we narrowed down this selection by focusing on firms with a consistent track record of increasing dividend payouts over time. From this refined list, we further filtered the companies to identify the top 11 that attracted the most hedge fund investors. We used Insider Monkey’s Q3 2023 database to gauge hedge fund interest and selected the companies that had garnered the highest number of investments from these hedge funds.
11. Exxon Mobil Corporation (NYSE:XOM)
Number of Hedge Fund Holders: 79
Exxon Mobil Corporation (NYSE:XOM) is an American multinational oil and gas company. It operates across various segments of the energy industry, engaging in the exploration, production, refining, and marketing of oil, natural gas, petroleum products, petrochemicals, and other related commodities.
In the third quarter of 2023, Exxon Mobil Corporation (NYSE:XOM) reported a strong cash position with an operating cash flow of $16 billion. The company’s free cash flow for the quarter amounted to over $11.7 billion. During the quarter, the company returned $3.7 billion to shareholders through dividends. The company generated $90.7 billion in revenues, which makes XOM one of the best large-cap stocks on our list.
Exxon Mobil Corporation (NYSE:XOM) currently…