3 “Strong purchases” with at least 6% dividend yield
There is so much going on in the markets that it is difficult to know where to start and what to look for. From the red side of the ledger it is clear that a headwind is gathering. House Democrats are still rejecting the White House’s $ 1.8 trillion coronavirus aid package, saying President Trump̵
7;s proposal does not go far enough. House Dems is pushing its own $ 2.2 trillion stimulus. At the same time, both Eli Lilly and Johnson & Johnson stopped their coronavirus vaccination programs after the latter company reported an “adverse event” in early trials. This is not only a concern for investors, as most hopes for a “return to normal” depend on the development of a working vaccine for the new virus. And the profit season begins. Over the next few weeks, we will see third-quarter results from each publicly traded company, and investors will look forward to those results. The consensus is that profits will fall on an annual basis between 20% and 30%. With this in mind, we used the TipRanks database to extract three stocks with dividends that yield 6% or more. However, this is not all they offer. Each of these stocks has a strong buying rating and significant upside potential. Philip Morris (PM) First on the list is the tobacco company Philip Morris. The “sin stockpiles” of tobacco and alcohol producers have long been known for their good dividends. Over the past year, the prime minister has taken a different approach, turning to smokeless tobacco products marketed as cleaner and less hazardous to consumer health. One of the signs of this is the company’s partnership with Altria for the launch and launch of iQOS, a heated smokeless tobacco product that will allow consumers to receive nicotine without the contaminants of tobacco smoke. PM has invested more than $ 6 billion in the product. Given the regulatory challenges and PR associated with vaping products, PM believes that smokeless heated tobacco will prove to be a stronger alternative, with greater growth potential. Nevertheless, currently the main product of PM remains Marlboro cigarettes. The iconic brand remains the best-selling product, despite the long-term trend of public opinion turning against cigarettes. As for the dividend, the prime minister has been and remains a true champion. The company has been paying dividends every year since 2008 and paying reliably every quarter. Even the crown could not fail this; PM continued to pay $ 1.17 a quarter until 2020, and its last dividend, paid earlier this month, rose to $ 1.20 per ordinary share. This is calculated on an annual basis up to $ 4.80 and gives a yield of 6%. Covering PM for Piper Sandler, analyst Michael Lavery likes the move to smokeless products, writing: “We remain enthusiastic about PM’s strong long-term prospects and believe that the recent iQOS momentum during the COVID-19 pandemic is impressive. iQOS has strong consumer growth and improved profitability, and reopening stores can further help boost acceptance from new users. Lavery estimates that PM shares overweight (ie buying), and its $ 98 target implies a 24% price increase in one year. (To view Lavery’s record, click here) Overall, the consensus rating for a strong PM purchase is based on 9 reviews, breaking 8 to 1 in Buy vs Hold Stocks are priced at $ 79.10 and their average price price of $ 93.56 suggests a potential increase of 18%. (See PMR stock analysis for TipRanks) Bank of NT Butterfield & Son (NTB) Butterfield is a small capital bank based in Bermuda that provides a full range of services to clients on the island – and in the Cayman Islands, the Bahamas and the Channel Islands. islands, as well as Singapore, Switzerland and the United Kingdom. Butterfield’s services include personal and business loans, savings accounts and credit cards, mortgages, insurance and wealth management. Butterfield saw revenue and profits fall in the first half of this year, in line with the overall global banking model – the COVID-19 pandemic put a shock absorber on business and bankers felt the impact. Earnings in the last quarter of 2019 were 87 cents per share, and by 2Q20 they fell to 67 cents. Although a significant decline, it was still 21% better than expected. In the upper limit, revenues are up to 121 million dollars. NTB reported gains for the third quarter later this month, and the forecast is for 63 cents EPS. Along with winning earnings forecasts, Butterfield is paying a strong dividend this year. Until the second quarter, dividend payments were up to 44 cents per share, making yields stable at 7%. When looking at the current low interest rate regime – the US Fed has set interest rates close to zero and government bonds are below 1% – NTB’s payment looks even better. , “… stable capital levels [provide] more than enough capacity to absorb losses in our opinion for any credit problems. Its stability of fee income has proved valuable given the impact of declining rates on NII, where the bank actively manages costs to support profits. We continue to believe that its dividend is safe for now, given its portfolio of low-risk loans, stable capital levels and our forecast to pay a dividend below 100%, even below our stressed prospects. “These comments support the analyst’s superiority (ie buying) rating, and its price tag of $ 29 offers 15% up for next year. (To watch Worthington’s record, click here) Overall, NTB has 4 recent reviews, which include 3 purchases and one hold, which makes the analyst’s consensus a strong purchase. This stock has an average price of $ 29, corresponding to that of Worthington. (See TipRanks NTB inventory analysis) Enviva (EVA) The last on our list is the energy company, Enviva. This company has an interesting niche in a major sector that produces “green” energy. In particular, Enviva is a producer of processed biomass fuel derived from wood pellets sold to power plants. Fuel burns cleaner than coal – an important moment in today’s political climate – and is produced from recycled waste (sawdust and sawdust) from the timber industry. The company’s production facilities are located in the US Southeast, while its main customers are in the UK and continental Europe. The economic downturns imposed during the Crown Pandemic reduced energy demand, and Enviva’s revenues fell in 1H20, mainly due to reduced demand. However, earnings remained positive and the EPS forecast for Q3 predicts a jump back to 45 cents – in line with the strong gains seen in the second half of 2019. Enviva showed a steady commitment to pay its dividend and in the last quarter – the August payment – the company raise the payment from 68 cents per ordinary share to 77 cents. This brought the annual dividend value to $ 3.08 per share and made the return 7.3%. Even better, Enviva has been paying regular dividends for the past 5 years. Covering this share for Raymond James is the analyst Pavel Molchanov, who evaluates EVA as Outperform (ie Buy) and sets a price price of $ 44. The recent rise in shares brought the shares closer to this goal. Supporting his position, Molchanov writes: “Enviva benefits from an ever-expanding customer base and has high growth through falling falls. In the context of mass coal retirement in the energy sector – including (as of September 2020) 34 countries and 33 subnational jurisdictions with mandatory termination of coal … “(To follow Molchanov’s record, click here.) The consensus rating of Enviva Strong Buy is based on 4 purchases and 1 retention. The share price it has won in recent sessions is $ 42.60 and, as mentioned, it closed at the target for the average price of $ 44.80. (See an analysis of EVA shares in TipRanks.) To find good ideas for dividend stocks trading at attractive ratings, visit TipRanks, the best-selling stock, a recently launched tool that brings together all insights into TipRanks ownership. Responsibility: The views expressed in this article are those of the analysts presented. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.