Best Dividend Stocks Yielding at Least 5% to Buy According to Hedge Funds

As the second half of the year approaches, investors are seeking strong market gains, a sentiment echoed by research firms on Wall Street following the de-escalation of tensions in the Middle East. Strong earnings growth and easing macroeconomic concerns are expected to strengthen investor sentiment, with Wells Fargo raising its year-end target for the S&P 500 to 7,950, joining Citi, Morgan Stanley, JPMorgan, and UBS in raising targets.

Best Dividend Stocks Yielding at Least 5% to Buy According to Hedge Funds

While dividend stocks offer a way to accumulate income on the side, the best dividend stocks are not necessarily those paying high yields. However, they are stocks with an impressive record of dividend payouts, backed by resilient core businesses.

“Tempting as they might be, the stock market’s juiciest yields are often illusory,” explains Dan Lefkovitz, strategist for Morningstar Indexes. “High dividend yields are often found in risky sectors, industries, and companies.” And as a result, such high-dividend yields aren’t always sustainable.

Methodology

For this list, we screened for companies with dividend yields above 5% as of June 27. From that list, we identified companies with trailing-12-month free cash flow exceeding $500 million. The stocks are ranked in ascending order based on the number of hedge funds that hold stakes in them in Q1 2026.

Market Impact and Details

• Strategists at JPMorgan Global Research remain positive on global equities, forecasting double-digit gains across developed and emerging markets.
• The gains will be driven by corporate earnings acceleration beyond what typical economic cycles produce.
• Morgan Stanley’s strategists expect 18% earnings-per-share growth for 2026, which will support higher valuations relative to historical averages.

Key Takeaways

• The best dividend stocks yielding at least 5% to buy according to hedge funds are those of companies with strong economic moats and competitive advantages across various sectors.
• These stocks offer a way to accumulate income on the side, backed by resilient core businesses.
• Investors can outperform the market by imitating the top stock picks of the best hedge funds.

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Conclusion

The best dividend stocks yielding at least 5% to buy according to hedge funds are those of companies with strong economic moats and competitive advantages across various sectors. As the second half of the year approaches, investors are seeking strong market gains, and these stocks offer a way to accumulate income on the side, backed by resilient core businesses. By imitating the top stock picks of the best hedge funds, investors can outperform the market and achieve their financial goals.

Top 10 Dividend Stocks

10. Cheniere Energy Partners, L.P. (NYSE:CQP)

Dividend Yield: 5.73%

Levered Free Cash Flow: $2.37 billion

Number of Hedge Fund Holders: 5

Cheniere Energy Partners, L.P. (NYSE:CQP) is one of the best dividend stocks yielding at least 5% to buy according to hedge funds.

9. Wipro Limited (NYSE:WIT)

Dividend Yield: 6.39%

Levered Free Cash Flow: $115.36 billion

Number of Hedge Fund Holders: 14

Wipro Limited (NYSE:WIT) is one of the best dividend stocks yielding at least 5% to buy according to hedge funds.

8. Other Stocks

Other stocks on the list include:

• Company Name (NYSE:STK)
• Dividend Yield: 6.21%
• Levered Free Cash Flow: $1.23 billion
• Number of Hedge Fund Holders: 7
• Company Name (NYSE:STK) is one of the best dividend stocks yielding at least 5% to buy according to hedge funds.