To say that hedge fund and mutual fund managers tend to follow the herd is very much an understatement, and it always has been. While publicly they sometimes seem reluctant to discuss their holdings, especially stocks they short, the reality is that managers tend to talk among themselves, as they run in the same circles. Often those discussions are centered on their portfolios and what is in them.
A new Jefferies research report looks at the hedge fund holdings of the top industry players, since the releases of 13F filings are pretty much complete after the end of the first quarter. While the normal suspects and predictable holdings remained pretty much the same (and have for years), we were intrigued by the so-called Short to Long group. These are stocks that portfolio managers have turned positive on after, in many cases, having been short the stocks at some point.
The report noted this: “Our Short to Long portfolio showed more sector diversity compared to prior months, with 9 sectors represented, the most coming from Tech with 5 names, followed by Health Care and Discretionary with 3 names each.”
We screened this list looking for stocks that were Buy-rated across Wall Street and also paid solid and dependable dividends. We found five top companies that investors may want to consider now, as the opinion tide appears to have turned. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Camden Property Trust
With rents trending higher, this real estate idea makes sense now for growth and income investors. Camden Property Trust (NYSE: CPT) is a real estate company primarily engaged in the ownership, management, development, redevelopment, acquisition and construction of multifamily apartment communities.
Camden owns interests in and operates 167 properties containing 56,850 apartment homes across the United States. Upon completion of seven properties currently under development, the company’s portfolio will increase to 59,104 apartment homes in 174 properties.
Also note that the stock is moving into the S&P 500 and has had some very solid price action recently.
Camden Property Trust stock investors receive a 2.15% dividend. Barclays has a $193 target price on the shares, while the consensus target is $186.10. The closing share price on Thursday was $172.61.
24/7 Wall St.Dow
This stock certainly offers investors growth and income potential. Dow Inc. (NYSE: DOW) is a leading materials science company and was formed from the merger of Dow and DuPont in 2017 and the subsequent spin-off 2019. The company is organized into three principal divisions: Performance Materials & Coatings (23% of EBITDA), Industrial Intermediates & Infrastructure (27%) and Packaging & Specialty Plastics (51%).
Dow’s segments include Agricultural Sciences, which is engaged in providing crop protection and seed/plant biotechnology products and technologies, urban pest management solutions and healthy oils. The Consumer Solutions segment consists of Consumer Care, Dow Automotive Systems, Dow Electronic Materials and Consumer Solutions-Silicones businesses.
The Infrastructure Solutions segment consists of Dow Building & Construction, Dow Coating Materials, Energy & Water Solutions, Performance Monomers and Infrastructure Solutions-Silicones businesses. Performance Materials & Chemicals consists of Chlor-Alkali and Vinyl, Industrial Solutions and Polyurethanes businesses. The Performance Plastics unit consists of Dow Elastomers, Dow Electrical and Telecommunications, Dow Packaging and Specialty Plastics, Energy and Hydrocarbons businesses.
Investors receive a 4.54% dividend. The Wells Fargo price target on Dow stock is $67. The consensus target is $65.43, and shares traded at $61.25 on Thursday’s close.
Entergy
This top utility stock always makes sense for conservative investors. Entergy Corp. (NYSE: ETR) engages in the production and distribution of electricity in the United States. Its Utility segment generates, transmits, distributes and sells electric power in portions of Arkansas, Louisiana, Mississippi and Texas, including the City of New Orleans. It also distributes natural gas.
The Entergy Wholesale Commodities segment is involved in the ownership, operation and decommissioning of nuclear power plants located in the northern United States. It also engages in sale of electric power to wholesale customers, provision of services to other nuclear power plant owners and ownership of interests in non-nuclear power plants that sell electric power to wholesale customers.
The company generates electricity through gas, nuclear, coal, hydro and solar power sources. It sells energy to retail power providers, utilities, electric power co-operatives, power trading organizations and other power generation companies. Its power plants have approximately 26,000 megawatts (MW) of electric generating capacity, which include 6,000 MW of nuclear power. The company delivers electricity to 3 million utility customers.
Many analysts like the position of the company’s plants, as they supply some of the petrochemical industry along the Gulf Coast. Petrochemical plants and liquefied natural gas export facilities are springing up across the region.
Investors receive a 3.27% dividend. The $125 Wells Fargo price target is higher than the $118.91 consensus target. Entergy stock closed on Thursday at $122.99.
Fidelity National Financial
While a somewhat off-the-radar financial idea, this company has been around for years and its stock offers conservative investors some safety and growth potential. Fidelity National Financial Inc. (NYSE: FNF) provides various insurance products in the United States.
The company offers title insurance, escrow and other title-related services, including trust activities, trustee sales guarantees, recordings and reconveyances, and home warranty insurance. It also provides technology and transaction services to the real estate and mortgage industries, as well as mortgage transaction services, including title-related services and facilitation of production and management of mortgage loans. Further, the company engages in the real estate brokerage business.
The company also offers annuity and life insurance products, such as deferred annuities that include fixed indexed, fixed-rate and immediate annuities, as well as indexed universal life insurance products.
Shareholders receive a 3.88% dividend. Credit Suisse has set a $59 target price. The consensus target for Fidelity National Financial stock is higher at $66.20. The shares closed on Thursday at $44.15.
Intel
This legacy leader in semiconductors has continued working hard to focus more on Internet of Things and data center cloud spending. Intel Corp. (NASDAQ: INTC) designs, manufactures and sells integrated digital technology platforms worldwide.
The platforms are used in various computing applications, comprising notebooks, two-in-one systems, desktops, servers, tablets, smartphones, wireless and wired connectivity products, wearables, retail devices and manufacturing devices, as well as for retail, transportation, industrial, buildings, home use and other market segments.
The company announced in January it would invest up to $100 billion to build potentially the world’s largest chip-making complex in Ohio, looking to boost capacity as a global shortage of semiconductors affects everything from smartphones to automobiles.
Shareholders receive a 3.07% dividend. The $70 Intel stock target price at Credit Suisse compares with a $54.19 consensus target and a closing share price on Thursday of $47.56.
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