Billionaire George Soros is betting on 3 high yield dividend stocks
“If investing is fun and you have fun, you probably aren't making money. Good investing is boring.” The words are George Soros, and whatever you think of his politics or activism, it's impossible to deny that he is one of the largest equity market investors in the world. In some 30 years of active trading, his hedge fund achieved an average annualized return of over 30%. It was one of the biggest gains in Wall Street history. Soros ran his hedge fund behind the scenes and built a portfolio based on steady dividends and solid returns, and has continued that strategy for the past several years after privatizing his company, and given his "good investing is boring" aphorism, it's no wonder Soros opted for stocks with proven returns, his recent new positions simply confirm this, as Soros bets in three stocks has bought enormous potential returns – dividend yields of 4.5% or better and upside potential of 15%, according to the analyst community. With that in mind, we used the TipRanks database to find out what else makes this selection so compelling. Blackstone Mortgage Trust (BXMT) The first Soros pick that we look at is Blackstone Mortgage Trust, a real estate investment trust. No wonder Soros turned to BXMT when looking for dividend yields – REITs are known for their high-yield dividends. Blackstone, which has more than $ 167 billion in real estate under management, is focused on senior collateral mortgage loans in Western markets: North America, Europe, Australia. After a hard hit in the first quarter due to the coronavirus crisis, Blackstone's Q2 report pleasantly surprised investors by beating expectations for both sales and earnings per share. While revenue was $ 107.1 million, or 1% above forecast, earnings per share of 56 cents showed a stronger increase of 14%. In a sign of confidence, the company kept its dividend payment stable in the chaotic first half of the year. The quarterly dividend of 62 cents was paid in mid-July and offers investors a robust 10.3% return on an annualized basis at $ 2.48 per share. That's more than five times the average among S&P listed stocks – and four times the average among peers in the financial sector. High returns are always an attraction for Soros, and he opened his position in BXMT with 355,000 shares. At current stock prices, these stocks are worth more than $ 8.5 million. Analyst Donald Fandetti, who covers Wells Fargo's BXMT, sees reason for optimism on Blackstone's balance sheet and what that means for dividends. He writes, “A competitive advantage gave BXMT $ 607 million in debt and equity in the quarter and increased liquidity to $ 1.3 billion (mostly cash). This enables them to go on the offensive when opportunities for high returns arise. We believe that BXMT will continue to distribute its quarterly dividend as long as the economic situation does not deteriorate further. “Fandetti's comments support his overweight (ie buy) rating and his $ 33 price target suggests a 37% gain for BXMT over the coming year. (To see Fandetti's track record, click here.) Overall, Blackstone Mortgage has a moderate buy rating from analyst consensus, with 5 recent ratings split between 2 buys and 3 holds. The shares sell for $ 23.79, and the average target price of $ 27.75 implies upside potential of 15%. (See BXMT stock analysis on TipRanks) Truist Financial (TFC) Truist was founded last December through a merger of SunTrust and BB&T and is the eighth largest bank holding company in the US. The main subsidiaries operate over 2,000 bank branches in 17 states with headquarters in Charlotte, North Carolina. Like many banks that rely on brick and mortar retail branches, the company's shares depreciated sharply during the corona crisis and have only partially recovered. During the tough first half of 20, Truist regularly paid out its dividend at 45 cents per common share. The latest statement of August 13th for a September 1st payment continues this reliability. The 45 cent payment results in a 4.5% return which is strong in every way and is enhanced by the company's reliable payment history. The Soros Fund took the bank's merger as an opportunity to buy into a larger bank with greater resources. The billionaire's fund bought 498,669 TFC shares, a stake valued at $ 19.74 million – hardly a sucker even for George Soros and an indication of commitment to the new stake. Wall Street agrees that TFC is an offer to buy. Wolfe Research analyst Bill Carcache rates the stock at an Outperform (i.e. Buy) rating, and his price target of $ 52 showed confidence in upside potential of 31%. (To see Carcache's track record, click here.) The 5-star star wrote, "We see an opportunity for TFC to bring CET1 closer to peer levels as we discuss the near-term mergers and COVID- 19-Risks. TFC's medium-term CET1 target of 10% appears relatively conservative … According to our calculation, every 50 basis point reduction in CET1 would lead to an improvement in ROTCE of ~ 90 basis points. “TFC's moderate buy analyst consensus rating on Truist comes from 7 ratings, including 5 buys and 2 holding. The average target price of USD 45.86 implies an upward movement of 16% compared to the trading price of USD 39.12. (See TFC stock analysis at TipRanks) US Bancorp (USB) Last on today's list is another bank holding company, US Bancorp. The parent company of US Bank, headquartered in Minneapolis, Minnesota, US Bancorp, is the fifth largest American bank providing banking, investment and mortgage services to individuals, small and medium-sized businesses, and government agencies, primarily in the Midwest and West. The company has more than 3,000 branches and 4,800 ATMs across the service sector and a market capitalization of $ 56 billion. The large network and deep pockets were beneficial to the company in the first half of 20, when earnings fell from $ 1.08 in the fourth quarter to 41 cents in 2001 Q2. Revenue rose slightly from $ 5.6 billion to $ 5.8 billion over the same period. The social standstill and the associated reduction in traffic in the branches affect day-to-day business. In the second quarter, business rebounded to some extent, with total loans increasing 7% and average deposit balances increasing 11%. The company's regular quarterly dividend was paid out at this rate for the fourth straight quarter in mid-July at 42 cents. The annualized payment of $ 1.68 brings the dividend a yield of 4.5%, and the company's 11 year history of regular dividend increases clearly draws it for high yield investors. Soros would clearly agree. His fund took a position in USB by buying 614,294 shares. The investment is valued at $ 22.85 million at the current share price. Chris Kotowski, a 4-star analyst at Oppenheimer, sees Wall Street that USB is well suited for the current coronavirus environment. "USB remains the name" Escape to Safety "in space, which the diversified model can generate pre-provisioning earnings that could easily fund future potential reserve build-ups without diluting the TBV … UBS resulted in a stable revenue and spending outlook. NII is expected to be unchanged in Q3 20 versus Q2 20, mortgage lending business could increase year over year but be below Q2 20, and payment is increasing due to the gradual reopening of the economy. USB also expects interest-free expenses to be stable in Q3 20 versus Q2 20 and fiscal 2020 tax rate of 15%, "said Kotowski. To this end, Kotowski rates USB shares as outperforming (ie Buy) backed by a target price of $ 75, which implies an upside potential of 101% for the coming year. (To see Kotowski's track record, click here.) Overall, US Bancorp has a moderate buy rating from analyst consensus pointing to 6 buys, 4 holds, and 1 sell based The stock is selling for $ 36.82, and the average target price of $ 44.40 suggests that growth of 21% is possible over the next 12 months (see USB- Stock analysis on TipRanks.) Good ideas for trading dividend stocks at great prices can be found at TipRanks' Best Stocks to Buy, a newly launched tool that has all the insights into reviews the shares of TipRanks united. Disclaimer: The opinions expressed in this article are solely those of the analysts presented. The content is for informational purposes only. It is very important that you do your debt analysis before making any investment.