The rally since June has been welcome, as investors were hammered down into bear market territory for the first half of the year. Yet, with a recession bearing down, more interest rate hikes on the horizon and white-hot inflation still torturing consumers, especially at the gas pump and the grocery store, the prospects going forward do not look particularly good.
So now, weary stock investors feel trapped as they see the meme stock retail army making money again on short-squeeze candidates, and they are paralyzed by the FOMO (fear of missing out) conundrum. The facts are that the summer surge higher likely has been a bear market rally, which often can be huge, and the smart move now is to take profits and grab large-cap dividend stocks that are on sale.
We screened our S&P 500 equity research database looking for companies offering the biggest and most dependable dividends, those with Buyated stocks that have very solid total return potential. Seven companies look like outstanding ideas for concerned investors.
It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Altria
This maker of tobacco products offers value investors a great entry point now as it has been hit as cigarette sales have slowed. Altria Group Inc. (NYSE: MO) is the parent company of Philip Morris USA (cigarettes), UST (smokeless), John Middleton (cigars), Ste. Michelle Wine Estates and Philip Morris Capital. PMUSA enjoys a 51% share of the U.S. cigarette market, led by its top cigarette brand Marlboro.
Altria also owns over 10% of Anheuser-Busch InBev, the world’s largest brewer. In 2008, it spun off its international cigarette business to shareholders. The stock was pounded recently, as last month the U.S. Food and Drug Administration announced the ban of all sales of Juul vape pens. This decision was made after pleas from government officials and public health institutes that say Juul is focused on selling its nicotine products to teenagers. A court has granted Juul’s request for a stay on the ban, allowing the company to still sell the products while an appeal is made on the decision.
While this gets sorted out, it is a good bet that investors will still receive a giant 7.95% dividend. Deutsche Bank has a $46 target price on Altria stock. The consensus target is higher at $49.34, and shares closed on Wednesday at $45.45.
AT&T
The legacy telecommunications company has been going through a long restructuring, has lowered its dividend and has sold off or merged underperforming assets. AT&T Inc. (NYSE: T) provides telecommunications, media and technology services worldwide.
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