6 Interesting High-Dividend Stocks to Buy
July 21, 8:03 am
As markets hover around record highs, the prospect of heightened volatility looms large. This volatility stems from multiple sources: the unpredictability of the upcoming Presidential election, ongoing geopolitical tensions, concerns over inflation, and the potential for fluctuating interest rates. Each of these factors can contribute to market swings, making it crucial for investors to diversify their strategies. While growth stocks remain essential, there's a growing argument for leaning towards high-quality dividend stocks. These stocks, backed by strong fundamentals, offer the dual benefits of regular income and potential capital appreciation, making them an attractive option for the next 24 to 36 months.
In this article, we highlight six dividend stocks that stand out due to their high yields, solid financial health or high AI score.
Chevron (CVX)
Chevron is one of the world's biggest oil and gas companies and the only energy company included in the Dow Jones Industrial Average. Despite a mixed Q1’24 performance, with reported earnings dropping from $6.6 billion to $5.5 billion year-over-year, U.S. upstream sales are strong, and worldwide production is up 12% from the same period last year.
CVX stock has a 4.50 rating from 20 analyst firms, making it a strong buy. The company pays $1.63 per share quarterly or $6.52 annually, representing a significant rise from last year’s $1.51 quarterly payout and translating to an above-average 4.02% yield. Although Chevron's job postings decreased recently, this trend is reversing as the company starts hiring again.
Altria Group (MO)
Altria's stock has rallied by 19% year-to-date. Despite remaining undervalued with a forward P/E of 9.4, it offers a dividend yield of 8.16%. Altria subsidiary NJOY received FDA authorization for its menthol e-vapor product, the first and only menthol product authorized, likely supporting future growth.
Altria has also submitted an application for its "innovative on! PLUS oral nicotine pouch products." While the smokable segment growth remains subdued, the business continues to generate strong cash flow, ensuring sustained dividends as the company invests in non-smokable products.
Abbott Laboratories (ABT)
Abbott Laboratories is a globally recognized healthcare product provider, developing and distributing nutritional products, medical testing and monitoring devices, and diagnostics equipment. In Q2’24, Abbott reported a 4% sales growth, resulting in a total quarterly sales of $10.4 billion.
Abbott announced its 402nd consecutive quarterly dividend payment of 55 cents per share, or $2.20 annually, reflecting a 2.20% yield. The company boasts 52 years of increased dividend payouts. Rohit Khanna, a democrat, has been buying the stock over the last few months, indicating strong confidence in its growth potential.
General Dynamics (GD)
General Dynamics provides aerospace and defense vehicles, along with AI solutions for defense and cybersecurity initiatives through its subsidiary, General Dynamics Information Technology (GDIT). In Q1’24, the company reported an 8.6% year-over-year revenue increase and a 9.1% increase in diluted EPS.
GD pays a $1.42 quarterly dividend per share, or $5.68 annually, for 2024. This represents a 1.94% yield, a 7.6% increase over 2023’s dividend payouts, and marks General Dynamics' 27th consecutive year of dividend growth.
Rio Tinto (RIO)
Rio Tinto is an undervalued industrial commodity stock with a forward P/E of 9.1 and a dividend yield of 7.78%. Despite sideways trading over the last 12 months, Rio Tinto reported an average annual free cash flow of $10.6 billion over the last five years, translating into a strong balance sheet and high financial flexibility.
The company plans annual capital investments of $7 billion between 2024 and 2026, supporting growth and diversification into metals like aluminium, copper, lithium, and titanium dioxide, in addition to iron ore.
Agnico Eagle Mines (AEM)
Agnico Eagle Mines, a gold mining company, has seen its stock rise by 46% year-over-year. With a dividend yield of 2.14%, our algorithm indicates continued strong growth potential due to an increase in employees, high business outlook, and robust financials.
Conclusion
In conclusion, these six stocks with high dividend yields and strong fundamentals present promising investment opportunities. As market volatility continues, focusing on quality dividend stocks can provide stability and robust returns over the next 24 to 36 months.
For an updated list of stocks with a high AI score and a high dividend yield, check our Best Dividend Stocks page.
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