Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

2 Dividend-Paying Stocks To Help Weather Geopolitical Uncertainty

By Investing.com (Haris Anwar/Investing.com)Stock MarketsNov 05, 2020 10:03AM ET
www.investing.com/analysis/2-dividend-paying-stocks-to-help-weather-geopolitical-uncertainty-200543567
2 Dividend-Paying Stocks To Help Weather Geopolitical Uncertainty
By Investing.com (Haris Anwar/Investing.com)   |  Nov 05, 2020 10:03AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

Currently, investors are facing heightened levels of risk. Even as the COVID-19 pandemic continues to spread, a closely-contested US Presidential election is making it even tougher to decide which stocks to buy for the long haul, and which to sell now.

But these worries are mostly for those who invest in equities for a quick profit. For buy-and-hold investors, with the goal of earning steadily increasing returns, this market volatility doesn’t mean much.

Such people carefully pick holdings for their durable competitive advantage and the ability to sustain economic and political shocks. The idea behind this strategy is to ensure that regular dividend payments will keep coming even if markets face turmoil, such as what occurred last March and is now taking place as the US presidential battle remains undecided.

The challenge: carefully selecting appropriate stocks. Luckily the guidelines are relatively simple—if a company has a dominant position in the industry, significant free cash flow and a history of solid dividend growth, chances are it will turn out to be a good long-term position.

We have two dividend-paying candidates worth considering:

1. Walmart 

With its massive scale, solid balance sheet and growing sales, mega retailer Walmart (NYSE:WMT) can provide steadily growing income in both good and bad times.

The company has hiked its payout every year since it began paying dividends in March 1974, placing it in the elite club of 53 S&P 500 stocks dubbed “dividend aristocrats.” That's the designation given to companies that have a record of boosting dividends regularly for 25 years or more.

WMT Weekly TTM
WMT Weekly TTM

During the pandemic, Walmart has proven that it’s one of the safest dividend stocks to own. The Bentonville, Arkansas-based retailer continues to benefit from the many ways the pandemic has reshaped consumer needs and spending patterns.

In the most recent quarter, Walmart reported that US comparable sales rose 9.3% from a year earlier, far surpassing analysts’ estimates. The growth was powered by its e-commerce division, where sales jumped 97% from a year earlier, with both pickup and delivery options notching all-time high sales volumes.

These numbers show that Walmart is succeeding in countering the threat posed by the onslaught of e-commerce competitors. It could also provide long-term stability to investors in terms of dividend sustainability.

The stock now has an annual dividend yield of 1.56%; the company pays a quarterly dividend of $0.54 a share. Since Mar. 1, Walmart shares have posted a total gain, including distributions, of 31%. The stock closed at $141.96 on Wednesday.

2. Microsoft 

If a leading technology stock is a good fit for your long-term dividend portfolio, then Microsoft (NASDAQ:MSFT) is the best bet. Since 2004, when the software and infrastructure giant first began offering a dividend, its payout has swelled six-fold. Microsoft's current annual dividend yield is 1.11% with a quarterly payout of $0.56 per share.

MSFT Weekly TTM
MSFT Weekly TTM

The good news for new investors in MSFT stock is that the company is in a great position to sustain that kind of growth, supported by increasing free cash flows and a low payout ratio of 32.9.  Shares closed at $216.39 on Wednesday.

In the most recent quarter, the Seattle-based company showed it continues to benefit from the pandemic as consumers shift to cloud-based connectivity and online subscriptions to its Office software, which comes with teleconferencing programs and work-from-home tools.

Microsoft’s earnings momentum will continue as it expands its market share in the cloud computing segment while maintaining its leading position with legacy software products such as Windows and Office.

This durable advantage will surely help the company achieve sustained, double-digit growth in revenue, earnings per share and free cash flow, making it a reliable tech stock to own over the long run.

2 Dividend-Paying Stocks To Help Weather Geopolitical Uncertainty
 

Related Articles

2 Dividend-Paying Stocks To Help Weather Geopolitical Uncertainty

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (2)
Amy March
Amy March Nov 06, 2020 2:15AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Add IBM and im in total aggreance
Anup BUDIHAL
Anup BUDIHAL Nov 05, 2020 2:41PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
You mentioned apple has no strength to grow but it climbed from 113 to 119 since the time u said!
Amy March
Amy March Nov 05, 2020 2:41PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Apple has not only infrastructure & tech, cloud but also retail its diversified.. divi not great no! But a sure bet
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email