Low Beta, Dividend Yielding Stocks In Uncertain Markets

Markets conditions have been volatile over the past few days as investors anticipate the U.S. Fed to hike rates soon. In terms of economic growth, some analysts foresee slow-paced growth for the third and fourth quarters of 2016, while others are positive of a healthy rebound. In view of these factors, the overall picture remains unclear.

Benefits of Low Beta and Dividends

As most of us are aware, beta is a measure of market risk. A stock with a beta greater than 1 is much more volatile than a stock with beta of less than 1. Although other aspects play a part in determining stock price volatility, beta serves as a good indicator of how the stock would perform with respect to the overall market. Therefore, low beta stocks seem to a lucrative investment option amid the currently uncertain market conditions. These stocks, however, should generally be considered for a slightly longer time period as their price is not expected to swing significantly with markets owing to the low beta.

Another aspect to be considered by investors who prefer stable returns is a stock’s dividend. Dividend yielding stocks tend to assure atleast a fixed return on investment. Hence, the combination of low beta and steady dividend yield of a stock is favorable if investors want to create a relatively low risk-stable returns portfolio.

Stocks that Warrant a Look

We have selected four stocks which can be considered by investors interested in low beta, dividend yielding stocks. These stocks have been picked using criteria like dividend yield above 3%, beta below 0.8 and a Zacks Rank #1 (Strong Buy) or #2 (Buy). We believe that these stocks are a valuable investment opportunity.

Headquartered in Jacksonville, FL, Rayonier Inc. (NYSE:RYN) is a timberland real estate investment trust. The company leases, manages or owns timber growing land across U.S. and New Zealand. The company has a Zacks Rank #2 and a beta of 0.63. The company’s annual dividend yield is 3.80%. Notably, the company beat earnings estimates in each of the last four quarters with an average surprise of 63.49%.

Solar Capital Ltd. (NASDAQ:SLRC) , which is based in Milpitas, CA, is an investment grade business development company with investments mostly in private middle market companies’ senior secured loans and subordinated debt. The company holds a Zacks Rank #2 and has a beta of 0.6. The current dividend yield of the company is 7.92%.

Pinnacle West Capital Corp. (NYSE:PNW) , headquartered in Phoenix, AZ, is engaged in generation, distribution and delivery of energy related products and services. With a Zacks Rank #2, the company has a lucratively low beta of 0.35. The annual dividend yield of the company stands at 3.38%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Fort Worth, TX-based TPG Specialty Lending, Inc. (NYSE:TSLX) provides full underwritten capital solutions to middle market companies. The company carries a Zacks Rank #2 and has a beta of 0.7. With a dividend yield is 8.60%, the company also has a PE ratio of 10.66, lower than the industry average of 11.90.

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