10 Stocks the Best Europe Equity Income Fund Managers Have Been Buying

In a strong year for dividend stocks, some stocks have stood out as prime targets for Europe’s best income fund managers.

Since the beginning of the year, the Morningstar Europe Equity Income category has outperformed both the Morningstar Europe Dividend Yield Focus Index and the wider Morningstar Europe Index.

A look at the latest portfolios of some of the best fund managers in the category reveals which companies they have been buying.

To isolate the top stock-pickers, we screened on the following:

• Actively managed funds that land in the Europe Equity Income
  Morningstar Category
  .
• Funds with at least one share class earning a
  Morningstar Medalist Rating
  of Gold, Silver, or Bronze.
• Funds that hold 100 stocks or fewer as of their most recently reported portfolios.

In total, 10 separate fund portfolios passed this screen. Comparing the latest portfolios of these funds with their portfolios three months prior reveals which stocks the managers have been buying.

10 Stocks That the Best Fund Managers Have Been Buying

Here are some of the stocks that top managers have been investing in during the past three months:

1. Intertek Group ITRK
2. Reckitt Benckiser Group RKT
3. FinecoBank FBK
4. London Stock Exchange Group LSEG
5. ING Group INGA
6. Nestlé NESN
7. Unilever ULVR
8. Bureau Veritas BVI
9. Nordea Bank NDA SE
10. ASML ASML

Some of the stocks that top managers have been buying look fairly valued or even overvalued today, according to Morningstar, but there are some undervalued stocks in the mix, too.

Intertek Group

• Number of Best Managers Buying the Stock: 2
• Morningstar Rating
  : ★★★
• Morningstar Economic Moat Rating
  : Wide
• Sector
  : Industrials

The best fund managers’ top stock pick during the last quarter was Intertek Group, one of two industrials names on the list. Morningstar thinks this British midcap stock is fairly valued.

We rate Intertek’s shareholder distribution as appropriate. The firm distributes a dividend of 65% of underlying net income, which adequately compensates shareholders while allowing the firm to invest, and is in line with peers. The company has supplemented its dividend with share repurchases during strong periods, most recently seen in its 2025 GBP 350 million share buyback.

Read more about Intertek Group here.

Reckitt Benckiser Group

• Number of Best Managers Buying the Stock: 4
• Morningstar Rating
  : ★★★★
• Morningstar Economic Moat Rating
  : Wide
• Sector
  : Consumer Defensive

One of five 4-star names on the list, Reckitt Benckiser Group is trading 22% below its fair value estimate. This household and personal products company belongs to the large-value segment of the style box.

Reckitt’s approach to shareholder distributions is appropriate. Reckitt has a progressive dividend policy and has increased dividends by 5% per year over the last two years, which we expect will continue over the midterm. Since October 2023, the company launched two share buyback programs for the amount of GBP 1 billion each. The latest buyback program worth around GBP 1 billion was announced in early 2026. We believe these decisions were timely given the pronounced share price weakness experienced in recent years.

Read more about Reckitt Benckiser Group here.

FinecoBank

• Number of Best Managers Buying the Stock: 2
• Quantitative Morningstar Rating
  : ★★★
• Quantitative Morningstar Economic Moat Rating
  : Narrow
• Sector
  : Financial Services

Next on the list of stocks that the top managers have been buying is FinecoBank, one of four financial services names on the list. This mid-growth stock is 6% overvalued relative to Morningstar’s quantitative fair value estimate.

London Stock Exchange Group

• Number of Best Managers Buying the Stock: 1
• Morningstar Rating
  : ★★★★
• Morningstar Economic Moat Rating
  : Wide
• Sector
  : Financial Services

One of five 4-star names on the list, London Stock Exchange Group is trading 26% below its fair value estimate. This financial data firm belongs to the large-core segment of the style box.

On a forward-looking basis, we view LSEG’s balance sheet as sound. LSEG has a strong record on acquisitions and investments, spotting trends early and creating shareholder value as a result of it. Over the next couple of years, we expect a more muted approach to mergers and acquisitions, which does not rule out smaller acquisitions in alternative datasets and harder-to-value financial instruments segment. LSEG’s dividend policy of paying out 33%-40% of adjusted earnings is prudent. It is also committed to distributing excess capital to shareholders via share buybacks, which we view as value-accretive.

Read more about London Stock Exchange Group here.

ING Group

• Number of Best Managers Buying the Stock: 4
• Morningstar Rating
  : ★★
• Morningstar Economic Moat Rating
  : Narrow
• Sector
  : Financial Services

Diversified bank ING Group is one of four large-core names on the list. Shares of this stock are 23% overvalued relative to Morningstar’s fair value estimate.

ING’s shareholder distribution policy is appropriate. It has been executing regular share buybacks to return excess capital to shareholders, which augments ING’s stated dividend policy of paying 50% of earnings in cash dividends.

Read more about ING Group here.

Nestlé

• Number of Best Managers Buying the Stock: 4
• Morningstar Rating
  : ★★★★
• Morningstar Economic Moat Rating
  : Wide
• Sector
  : Consumer Defensive

Next on the list of stocks that the top managers have been buying is Nestlé, one of three consumer defensive names on the list. Morningstar thinks this large-core stock is 9% undervalued.

We believe shareholder distributions are appropriate. Nestlé has a policy of increasing dividends in Swiss francs, with consecutive annual increases approaching 30 years. During the last 15 years, the dividend has grown at a compounded annual rate of around 4.5%. The company has returned more than CHF 50 billion to shareholders through share buybacks between July 2017 and December 2024, spread across three different programs. Share buybacks will likely remain an important tool for shareholder distribution, although no further program is expected in 2026.

Read more about Nestlé here.

Unilever

• Number of Best Managers Buying the Stock: 4
• Morningstar Rating
  : ★★★
• Morningstar Economic Moat Rating
  : Wide
• Sector
  : Consumer Defensive

One of three 3-star names on the list, Unilever is trading 11% below its fair value estimate. This food, household and personal products company belongs to the large-core segment of the style box.

We think shareholder distributions are appropriate. Dividends have been the preferred vehicle for returning capital to shareholders, and Unilever has delivered slightly above-industry-average payout ratios of around 60% over the last decade. Share repurchases have also been an important use of surplus cash, especially following more sizable asset sales, and we think they have generally been carried out at a level that has created value for shareholders. We expect the firm to maintain its high dividend payout ratio and to be opportunistic when it comes to repurchasing shares. However, tuck-in acquisitions will probably remain a higher priority, particularly in the beauty and wellbeing space. Larger, transformative acquisitions are off the table.

Read more about Unilever here.

Bureau Veritas

• Number of Best Managers Buying the Stock: 1
• Morningstar Rating
  : ★★★★
• Morningstar Economic Moat Rating
  : Wide
• Sector
  : Industrials

Consulting firm Bureau Veritas is one of two mid-core names on the list. Morningstar thinks shares of this stock are 15% undervalued.

We rate Bureau Veritas’ shareholder distribution as appropriate. The firm distributes a dividend of 65% of its underlying net income. This figure adequately compensates shareholders while allowing the firm to still invest and is in line with peers in the industry. The company has supplemented dividends with repurchases during strong periods, but because of the business’ stable nature, repurchases are often made in small amounts.

Read more about Bureau Veritas here.

Nordea Bank

• Number of Best Managers Buying the Stock: 3
• Morningstar Rating
  : ★★
• Morningstar Economic Moat Rating
  : Narrow
• Sector
  : Financial Services

Next on the list of stocks that the top managers have been buying is Nordea Bank, one of four financial services names on the list. Morningstar thinks this large-value stock is 11% overvalued.

We assign Nordea a Standard Morningstar Capital Allocation Rating. Management has offloaded various high-risk balance-sheet exposures and divested multiple noncore segments in line with what we believe to be a prudent strategy to focus on its Nordic operation. Additionally, the bank has robust capital and liquidity positions.

Read more about Nordea Bank here.

ASML

• Number of Best Managers Buying the Stock: 1
• Morningstar Rating
  : ★★★★
• Morningstar Economic Moat Rating
  : Wide
• Sector
  : Technology

ASML rounds out the list of stocks that the best fund managers have been buying. Morningstar thinks shares of this stock are 14% undervalued.

From a shareholder distribution perspective, ASML balances dividend payments with share repurchases. The main way to reward shareholders is through share buybacks; the company has reduced outstanding shares by 10% since 2013. ASML has a systematic approach to share buybacks, meaning that it might not always repurchase when the share price is at its lowest. We would like to see a more opportunistic approach when shares are undervalued during cyclical swings.

ASML has been paying dividends since 2008, with payments fluctuating each year depending on the company’s needs. We expect the firm will maintain a 30% payout ratio policy.

Read more about ASML here.

How Do We Determine Which Stocks the Best Managers Are Buying?

To determine which stocks top managers are investing in, we compared the latest portfolios of these funds with their portfolios three months before. We then calculated a “buy score” for each stock, which is a weighted average that allows us to make apples-to-apples comparisons of the most purchased stocks.

Which 10 Funds Were Analyzed?

• Bantleon TOP 35 Aktien
• Indosuez Euro Rendement
• Danske Invest Europa Højt Udbytte Akk
• Unicaja Europa Dividendos FI
• Kempen European High Dividend Fund N.V.
• Vontobel Fund - European Equity Income Plus
• MEAG Dividende
• Danske Invest Europe High Dividend
• Richelieu Actions Europe
• GVC Gaesco Dividend Focus FI

One or two managers making large purchases of a stock could lead to the same buy score as many managers purchasing small amounts of a stock.