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6 Dividend Champions for Safely Compounding This Year's Hefty Market Gains

Published 02/28/2024, 09:33 AM
Updated 09/02/2020, 02:05 AM
  • Dividend ETFs can be great options for those looking to invest for regular income.
  • However, some investors prefer to invest in individual stocks.
  • So in this article, we will take a look at some top stocks with upside potential along with the best ETFs.
  • Investing in the stock market? Take advantage of our InvestingPro discounts. More information at the end of this article.

Investors often find dividends attractive, but it's not wise to base stock purchases solely on high dividend yields. While dividends can be a bonus, they shouldn't be the primary reason for buying stocks.

Before buying stocks for dividend yields, investors should consider aspects like financial health along with the stock's upside potential.

For those who aren't comfortable with investing in individual stocks, ETFs can be great options.

There are several well-known dividend ETFs to choose from. However, it's essential to examine their performance over the past few years before you decide to invest.

Here are the top dividend ETFs you can consider:

Vanguard FTSE Developed Markets Index Fund ETF Shares (NYSE:VEA)

  • Dividend yield: 4.99%
  • Focuses on Japanese dividend-paying companies.

Schwab U.S. Dividend Equity ETF (NYSE:SCHD)

  • Dividend yield: 3.81%
  • Manages 4.9B in assets.

WisdomTree Japan Hedged Equity Fund (NYSE:DXJ)

  • Dividend yield: 6.23%
  • Manages $8.4B in assets.

While ETFs can be a great choice for some investors, others prefer to invest in individual stocks.

Below, we will take a look at some stocks with appealing dividend yields and bullish potential using the InvestingPro tool, which provides essential data for our analysis.

1. Uniti Group

Uniti Group (NASDAQ:UNIT) is engaged in the acquisition and construction of communications infrastructure and is a leading provider of fiber and other wireless solutions.

Uniti Group Price Chart

Its dividend yield is +10.47%.

Uniti Group Dividend Data

Source: InvestingPro

On February 29 it presents its accounts. For 2024 the forecast is for an increase in earnings per share (EPS) of +82.4% and revenue of +3%.

Uniti Group Revenue and EPS Estimates

Source: InvestingPro

Its scalable nationwide network has facilitated customized agreements with wireless service providers. The company expects growth in fiber projects and new network construction.

It has 10 ratings, of which 3 are buy, 7 are hold and 1 is sell.

The market sees a 12-month potential at $6.90.

Uniti Group Targets

Source: InvestingPro

2. Civitas Resources

Civitas Resources (NYSE:CIVI) is a company that focuses on the acquisition, development, and production of oil and natural gas in the Rocky Mountain region.

Civitas Resources Price Chart

It was formerly known as Bonanza Creek (NYSE:BCEI) Energy. It was founded in 1999 and is headquartered in Denver, Colorado.

Its dividend yield is +12.07%.

Civitas Resources Dividend Data

Source: InvestingPro

On February 27th we will know its accounts. For 2024 the forecast is for an increase in earnings per share (EPS) of +29.7% and revenue of +57.9%.

Civitas Resources Revenue and EPS Forecasts

Source: InvestingPro

Looking at various metrics, we see that the stock is undervalued.

The market sees 12-month potential at $88.91.

Civitas Resources Targets

Source: InvestingPro

3. Organon

Organon & Co (NYSE:OGN) sells its products to hospitals, pharmacies, clinics, government agencies and other institutions. The company was incorporated in 2020 and is headquartered in Jersey City, New Jersey.

Organon Price Charts

Its dividend yield is +6.95%.

Organon Dividend Data

Source: InvestingPro

It will report its results on May 2. For 2024 the forecast is for an increase in earnings per share (EPS) of +3.3% and revenues of +2.2%. Its last known results 12 days ago were good.

Organon Last Earnings

Source: InvestingPro

It has 10 ratings, of which 5 are buy, 3 are hold and 2 are sell.

Market expectations put the stock at $21.38.

Organon Targets

Source: InvestingPro

4. AT&T

AT&T Inc (NYSE:T) was formerly known as SBC Communications and changed its name to AT&T in 2005. It was established in 1983 and is headquartered in Dallas, Texas.

AT&T Price Chart

It has a dividend yield of +6.61%.

AT&T Dividend Data

Source: InvestingPro

April 24 will be the time to look at its accounts. Revenues rose +1.8% in the last report and heading into 2024 another +1.1% increase is also expected.

AT&T Forecasts

Source: InvestingPro

Both InvestingPro's models and the market agree on the 12-month potential of its shares, specifically at $19.19 and $19.84 respectively.

AT&T Targets

Source: InvestingPro

5. Guess

Guess (NYSE:GES) is an apparel company that also sells watches and jewelry. It was founded in 1981 and is headquartered in Los Angeles, California.

Guess  Price Chart

Its dividend yield is +4.82%.

Guess Data

Source: InvestingPro

It will report its numbers on March 20. Revenue is expected to increase by +8.39% and earnings per share by +9.90%.

Guess Earnings

Source: InvestingPro

Guess and WHP Global have announced a definitive agreement whereby Guess acquires the rag & bone fashion brand, which has become a prominent name in the US fashion industry, with 34 stores in the US and 2 in the UK.

It has 5 ratings, of which 3 are buy, 2 are hold and none are sell.

The market gives it a potential at $27.31, while InvestingPro models it at $31.39.

Guess Targets

Source: InvestingPro

6. Clearway Energy)

Clearway Energy (NYSE:CWEN) operates in the renewable energy business in the United States. It was formerly known as NRG Yield and changed its name to Clearway Energy in August 2018.

Clearway Energy Class C

It was founded in 2012 and is headquartered in Princeton, New Jersey.

The dividend yield is +7.27%. It will deliver $0.40 per share to shareholders on March 15, and to receive it, shares must be held by February 29.

Clearway Energy Class C

Source: InvestingPro

May 2 is the time to publish its accounts. For 2024 it expects an increase in revenue of +9.7%.

Clearway Energy Class C

Source: InvestingPro

The potential the market sees for it in 12 months would be around $29.

Clearway Energy Class C

Source: InvestingPro

***

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Disclaimer: The author does not own any of these shares. This content, which is prepared for purely educational purposes, cannot be considered as investment advice.

Latest comments

I really don't understand how you can tout a dividend of 5, 6 or 7% when there are funds available that pay well over 12% ... and pay monthly.... help me understand you logic
What pays 12%? Can recommend?
ndx in good years
Organon lol
Might want to throw Ford in there as well. They have a 5% Dividend! The only reason to invest in Dividend stock paying less than 5% is that it stands a good chance to have at least moderate Capital appreciation as well. Else, just invest in a risk free 1 yr T-Bill at 5%.
Hi Ismael can we use this nice analysis in day trading or for short-term trading?
Thanks Sir. I appreciate your article.
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