2022 Kevin O'Leary Complete Stock Portfolio List & Top 10 Dividend Picks Now

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2022 Kevin O’Leary Complete Stock Portfolio List & Top 10 Dividend Picks Now


Updated on July 25th, 2022 by Bob Ciura

Kevin O’Leary is Chairman of O’Shares Investments, but you probably know him as “Mr. Wonderful”.

He can be seen on CNBC as well as the television show Shark Tank. Investors who have seen him on TV have likely heard him discuss his investment philosophy.

Mr. Wonderful looks for stocks that exhibit three main characteristics:

  1. First, they must be quality companies with strong financial performance and solid balance sheets.
  2. Second, he believes a portfolio should be diversified across different market sectors.
  3. Third, and perhaps most important, he demands income—he insists the stocks he invests in pay dividends to shareholders.

Note: 13F filing performance is different than fund performance. See how we calculate 13F filing performance here.

You can download the complete list of all of O’Shares Investment Advisor 13F filing stock holdings, along with quarterly performance, by clicking the link below:

 

Click here to download your Excel spreadsheet of O’Shares Investment Advisor’s 13F stock holdings, including metrics that matter like dividend yield and the forward price-to-earnings ratio.

OUSA owns stocks that display a mix of all three qualities. They are market leaders with strong profits, diversified business models, and they pay dividends to shareholders. The list of OUSA portfolio holdings is an interesting source of quality dividend growth stocks.

This article analyzes the fund’s largest holdings in detail.

Table of Contents

The top 10 holdings from the O’Shares FTSE U.S. Quality Dividend ETF are listed in order of their weighting in the fund, from lowest to highest.

No. 10: UnitedHealth Group (UNH)

Dividend Yield: 1.2%

Percentage of OUSA Portfolio: 2.82%

UnitedHealth Group operates as a diversified health care company in the United States. As it is common in this industry, despite UnitedHealth’s massive revenues which exceed $250 billion per year, its net margins remain razor-thin.

UnitedHealth’s quality operations and recurring cash flows have not led to a single unprofitable quarter in over 23 years.

UnitedHealth reported second quarter earnings on July 15th, 2022, and results were outstanding, as was updated guidance. Adjusted earnings-per-share came to $5.57, which was 37 cents ahead of expectations, and was almost 19% better than the year-ago period. Revenue was up almost 13% to $80.3 billion, which was more than $600 million ahead of estimates.

Both operating segments grew revenue by double-digits once more, as has been the case for some time. The company’s medical care ratio was 81.5% in Q2, down from 82.8% in the year-ago period. Operating costs were essentially flat at 14.6% of revenue.

The company boosted guidance to adjusted earnings-per-share of $21.40 to $21.90, so our estimate is the midpoint at $21.65.

Click here to download our most recent Sure Analysis report on UNH (preview of page 1 of 3 shown below):

No. 9: Lockheed Martin Corporation (LMT)

Dividend Yield: 2.8%

Percentage of OUSA Portfolio: 3.10%

Lockheed Martin Corporation is the world’s largest defense company. About 60% of the company’s revenues comes from the US Department of Defense, with other US government agencies (10%) and international clients (30%) making up the remainder.

The company consists of four business segments: Aeronautics (~40% sales) – which produces military aircraft like the F-35, F-22, F-16 and C-130; Rotary and Mission Systems (~26% sales) – which houses combat ships, naval electronics, and helicopters; Missiles and Fire Control (~16% sales) – which creates missile defense systems; and Space Systems (~17% sales) – which produces satellites.

In the 2022 first quarter,company-wide net sales decreased to $14,964M from $16,258M and diluted GAAP earnings per share fell to $6.44 from $6.56 on a year-over-year basis. Aeronautics net sales were flat at $6,401M from $6,3876M in the prior year due to higher volumes of F-16 offset by lower sales of F-35. Missiles and Fire Control sales decreased 11% to $2,452M from $2,749M in comparable periods due to lower volumes of tactical and strike missiles, integrated air and missile defense, and global sustainment and sensors.

Rotary and Mission Systems net sales were down 14% to $3,552M from $4,107M in the prior year due to decreases in
integrated warfare systems, C6ISR, training and logistics solutions, and helicopter programs. Space sales fell (-15%) to $2,559M from $3,015M due to renationalization of the Atomic Weapons Establishment program in the UK and lower volumes in civil space programs offset by higher sales for strategic and missile defense programs.

Lockheed Martin’s backlog is approximately $134.23B with an increase in Space and Rotary and Mission Systems and declines in the Aeronautics and Missiles and Fire Controls.

Lockheed has decided not to pursue the Aerojet Rocketdyne acquisition after the FTC sued to block it. Lockheed Martin guided for ~$66B in sales and ~$26.70 diluted earnings per share in 2022.

Click here to download our most recent Sure Analysis report on LMT (preview of page 1 of 3 shown below):


No. 8: McDonald’s Corporation (MCD)

Dividend Yield: 2.2%

Percentage of OUSA Portfolio: 3.20%

McDonald’s, founded in 1940 and headquartered in Chicago IL, is the world’s leading global foodservice retailer with nearly 40,000 locations in over 100 countries. Approximately 93% of the stores are independently owned and operated.

The company has raised its dividend every year since paying its first dividend in 1976, qualifying it as a Dividend Aristocrat.

On April 28th, 2022, McDonald’s reported Q1 2022 results for the period ending March 31st, 2022. For the quarter, total revenue came in at $5.67 billion, a 10.6% increase compared to Q1 2021. Revenue grew 6.5% at company-owned stores, while revenue increased 13.4% at franchised restaurants. Net income equaled $1.10 billion or $1.48 per share compared to $1.54 billion or $2.05 per share in Q1 2021.

McDonald’s is a very recession-resistant company. Its competitive advantage lies in its global scale, immense network of restaurants, well-known brand, and real estate assets. Indeed, the company’s superior track record against numerous competitors has illustrated why these aspects are important to the company’s success.

During the Great Recession McDonald’s posted excellent results, with earnings-per-share of $2.91, $3.67, $3.98, and $4.60 over the 2007 through 2010 stretch, while the dividend kept on increasing as well.

Click here to download our most recent Sure Analysis report on MCD (preview of page 1 of 3 shown below):

No. 7: Apple (AAPL)

Dividend Yield: 0.6%

Percentage of OUSA Portfolio: 3.69%

Apple revolutionized personal technology with the introduction of the Macintosh in 1984. Today the technology company designs, manufactures and sells products such as iPhones, iPads, Mac, Apple Watch and Apple TV. Apple also has a services business that sells music, apps, and subscriptions.

On April 28th, 2022, Apple declared a $0.23 quarterly dividend, marking a 4.5% year-over-year increase. Also on April 28th, 2022, Apple reported Q2 fiscal year 2022 results for the period ending March 26th, 2022. (Apple’s fiscal year ends the last Saturday in September).

For the quarter Apple generated revenue of $97.278 billion, an 8.6% increase compared to Q2 2021. Product sales were up 6.6%, led by a 5.5% increase in iPhones (52% of total sales). Service sales increased 17.3% to $19.8 billion and made up 20% of all sales in the quarter. Net income equaled $25.01 billion or $1.52 per share compared to $23.63 billion or $1.40 per share in Q2 2021.

Apple is the #1 holding of Berkshire Hathaway (BRK.B), making the technology giant one of the top Warren Buffett stocks.

Click here to download our most recent Sure Analysis report on AAPL (preview of page 1 of 3 shown below):


No. 6: Pfizer Inc. (PFE)

Dividend Yield: 3.1%

Percentage of OUSA Portfolio: 3.95%

Pfizer Inc. is a global pharmaceutical company that focuses on prescription drugs and vaccines. It is a mega-cap stock with a market cap of $287 billion. You can see our complete list of mega-cap stocks here.

Pfizer’s new CEO completed a series of transactions in 2019 significantly altering the company structure and strategy. Pfizer formed the GSK Consumer Healthcare Joint Venture with GlaxoSmithKline plc (GSK), which will include Pfizer’s over-the-counter business. Pfizer owns 32% of the JV.

Pfizer’s top products include Eliquis, Ibrance, Prevnar 13, Enbrel (international), Chantix, Sutent, Xtandi, Vyndaqel, Inlyta, and Xeljanz.

The company recently completed its acquisition of Arena Pharmaceuticals for etrasimod.

Source: Investor Presentation

Pfizer reported excellent Q1 2022 results on May 3rd, 2022. Companywide revenue rose 77% to $25,661M from
$14,516M and adjusted diluted earnings per share rose 72% to $1.62 versus $0.95 on a year-over-year basis. Diluted
GAAP earnings per share rose 59% to $1.37 from $0.86 in comparable quarters.

Pfizer is benefiting from market leadership with the COVID-19 vaccine and anti-viral drug. The company had nearly $15 billion in revenue from these two products alone in the quarter. The mRNA vaccine technology will be tried in two protease inhibitor antiviral compounds, a flu vaccine, a shingles vaccine, a breast cancer therapy, hemophilia gene therapy, a Lyme vaccine, RSV Adult vaccine, and others.

Pfizer maintained revenue guidance at $98B – $102B and lowered adjusted diluted EPS to $6.25 – $6.45 for 2022.

Click here to download our most recent Sure Analysis report on PFE (preview of page 1 of 3 shown below):


No. 5: Verizon Communications (VZ)

Dividend Yield: 5.7%

Percentage of OUSA Portfolio: 3.95%

Verizon is a telecommunications giant, and is one of the largest wireless carriers in the country. Wireless contributes three-quarters of all revenues, and broadband and cable services account for about a quarter of sales. The company’s network covers ~300 million people and 98% of the U.S.

Verizon has now launched 5G Ultra-Wideband in several cities as it continues its rollout of 5G service. Customers in parts of Atlanta, Dallas, Detroit, Indianapolis, Omaha, and Washington, D.C. could access the company’s 5G network. Verizon is the first of the major carriers to turn on the 5G service.

On July 22, 2022, the company reported the fiscal year’s second-quarter and first six months results. Revenue was flat year over year (YoY) at $33.8 billion for the quarter compared to the second quarter in 2021. Earnings came in at $1.24 per share, a decrease of 11.4% compared to the $1.40 per share the company made in 2Q201.

Source: Investor Presentation

One of Verizon’s key competitive advantages is that it is often considered the excellent wi-fi provider within the U.S. this is evidenced by the agency’s Wi-Fi internet additions and very low churn rate. This reliable service allows Verizon to preserve its consumer base in addition to delivering the organization the possibility to transport clients to higher-priced plans.

Verizon is also rolling out 5G service, which will give it an advantage over other carriers. Another advantage for Verizon is the stock’s ability to withstand a downturn in the market.

Click here to download our most recent Sure Analysis report on VZ (preview of page 1 of 3 shown below):


No. 4: Home Depot (HD)

Dividend Yield: 2.50%

Percentage of OUSA Portfolio: 4.07%

Home Depot was founded in 1978, and since that time has grown into the leading home improvement retailer with almost 2,300 stores in the U.S., Canada, and Mexico. In all, Home Depot generates annual revenue of approximately $130 billion.

Home Depot reported first quarter 2022 results on May 17th. The company reported first quarter sales of $38.9 billion, a 3.8% year-over-year increase. Comparable sales in the quarter rose 2.2%, and 1.7% in the U.S. specifically. Net earnings equated to $4.2 billion, or $4.09 per share, compared to $4.1 billion, or $3.86 per share in Q1 2021.

The company spent $2.3 billion in common stock repurchases during Q1 2022, less than the $3.8 billion spent in Q1 2021. Average ticket rose 11.4% compared to last year, from $82.37 to $91.72. Additionally, there was a 2.7% increase in sales per retail square foot, from $605.60 to $621.99.

As of the end of the first quarter, Home Depot has cash and cash equivalents equal to $2.8 billion. Leadership has upgraded guidance. For fiscal 2022, management expect sales growth and comparable sales growth of roughly 3.0%, with an operating margin of roughly 15.4%. The company will also pay $1.6 billion in net interest expense for 2022. Finally, diluted EPS growth is expected to be mid-single digits.

Click here to download our most recent Sure Analysis report on HD (preview of page 1 of 3 shown below):


No. 3: Microsoft Corporation (MSFT)

Dividend Yield: 1.0%

Percentage of OUSA Portfolio: 4.27%

Microsoft Corporation, founded in 1975 and headquartered in Redmond, WA, develops, manufactures and sells both software and hardware to businesses and consumers.

Its offerings include operating systems, business software, software development tools, video games and gaming hardware, and cloud services.

On April 26th, 2022, Microsoft reported Q3 fiscal year 2022 results for the period ending March 31st, 2022. (Microsoft’s fiscal year ends June 30th.) For the quarter, the company generated revenue of $49.4 billion, an 18% increase compared to Q3 2021. The growth was across the board with Productivity and Business Processes, Intelligent Cloud and Personal Computing growing 17%, 26%, and 11% respectively.

Azure, Microsoft’s high-growth cloud platform, grew by 46% year-over-year. Adjusted net income equaled $14.8 billion or $1.95 per share compared to $15.5 billion or $2.03 per share in Q3 2021.

Click here to download our most recent Sure Analysis report on Microsoft (preview of page 1 of 3 shown below):


No. 2: Procter & Gamble (PG)

Dividend Yield: 2.28%

Percentage of Portfolio: 4.97%

Procter & Gamble is a stalwart among dividend stocks. It has increased its dividend for the past 65 years in a row. This makes the company one of only 45 Dividend Kings, a list of stocks with 50+ years of rising dividends.

It has done this by becoming a global consumer staples giant. It sells its products in more than 180 countries around the world with annual sales of more than $70 billion. Some of its core brands include Gillette, Tide, Charmin, Crest, Pampers, Febreze, Head & Shoulders, Bounty, Oral-B, and many more.

These products are in high demand regardless of the state of the economy, making the company rather recession-proof.

On April 12th, 2022, Procter & Gamble raised its dividend by 5.0%, from $0.8698 per quarter to $0.9133.

Source: Investor Presentation

In mid-April, Procter & Gamble reported (4/20/22) financial results for the third quarter of fiscal 2022 (Procter & Gamble’s fiscal year ends June 30th). The company grew its sales and its organic sales 7% and 10%, respectively, over the prior year’s quarter. Organic sales growth resulted from 3% volume growth, 5% price hikes and 2% benefit from product mix.

Despite the strong headwind from high cost inflation, adjusted earnings-per-share grew 6%. Procter & Gamble raised its fiscal 2022 guidance for a second quarter in a row, anticipating 4%-5% sales growth (from 3%-4%). On the other hand, due to high cost inflation, it expects earnings-per-share growth at the low end of its 3%-6% guidance.

Click here to download our most recent Sure Analysis report on PG (preview of page 1 of 3 shown below):


No. 1: Johnson & Johnson (JNJ)

Dividend Yield: 2.5%

Percentage of OUSA Portfolio: 5.51%

Johnson & Johnson is a global healthcare giant. The company currently operates in three segments: Consumer, Pharmaceutical, and Medical Devices & Diagnostics. The corporation includes some 250 subsidiary companies with operations in 60 countries and products sold in over 175 countries. Johnson & Johnson had sales of $93.8 billion worldwide during the calendar year 2021.

Johnson & Johnson’s brands include numerous household names of medications and first aid supplies. Its well-known consumer products include the Band-Aid Brand line of bandages, Tylenol medications, Johnson’s Baby products, Neutrogena skin, beauty products, Clean & Clear facial wash, and Acuvue contact lenses. Johnson & Johnson’s pharmaceutical arm is Janssen Pharmaceuticals.

On April 19, 2022, the company reported first-quarter results for the 2022 Fiscal Year. Revenue increased 5% to $23.4 billion but missed estimates by $210 million. Adjusted earnings-per-share of $2.67 compared to $2.59 in the prior year was $0.10 better than expected.

Adjusted net earnings were 3% higher than the first quarter of last year. This quarter, net earnings were $7,129 million compared to $6,924 million in the first quarter of 2021.

 

Source: Investor Presentation

Johnson & Johnson’s key competitive advantage is the size and scale of its business. The company is a worldwide leader in several healthcare categories. Johnson & Johnson’s diversification allows it to continue to grow even if one of the segments is underperforming.

The company has increased its dividend for 60 consecutive years, making it a Dividend King.

Click here to download our most recent Sure Analysis report on JNJ (preview of page 1 of 3 shown below):


Final Thoughts

Kevin O’Leary has become a household name due to his appearances on the TV show Shark Tank. But he is also a well-known asset manager, and his investment philosophy largely aligns with Sure Dividend’s. Specifically, Mr. Wonderful typically invests in stocks with large and profitable businesses, with strong balance sheets and consistent dividend growth every year.

Not all of these stocks are currently rated as buys in the Sure Analysis Research Database, which ranks stocks based on expected total return due to a combination of earnings per share growth, dividends, and changes in the price-to-earnings multiple.

However, several of these 10 stocks are valuable holdings for a long-term dividend growth portfolio.

Additional Resources

See the articles below for analysis on other major investment firms/asset managers/gurus:

If you are interested in finding more high-quality dividend growth stocks suitable for long-term investment, the following Sure Dividend databases will be useful:

The major domestic stock market indices are another solid resource for finding investment ideas. Sure Dividend compiles the following stock market databases and updates them monthly:

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