After years of a low interest rate environment, many investors have turned to equities, not only for the growth potential but also for solid and dependable dividends that help to provide an income stream. What this equates to is total return, which is one of the most powerful investment strategies going. While interest rates are rising, these companies still make sense for investors looking for solid growth and income potential.
We like to remind readers about the impact total return has on portfolios because it is one of the best ways to help improve the chances for overall investing success. Again, total return is the combined increase in a stock’s value plus dividends. For instance, if you buy a stock at $20 that pays a 3% dividend, and it goes up to $22 in a year, your total return is 13%. That is, 10% for the increase in stock price and 3% for the dividends paid.
Six top large-cap companies that are Wall Street favorites are expected to raise their dividends this week. While it is always possible that not all of them do indeed raise their dividends, top analysts expect them to, and those expectations are based on past increases in the firm’s dividend payouts.
It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Apple
This legacy technology leader makes up a stunning 40% of the Berkshire Hathaway portfolio, and it is set to report earnings this week. Apple Inc. (NASDAQ: AAPL) designs, manufactures and markets consumer electronics and computers, and it has developed its own proprietary iOS and Mac OS X operating systems and related software platform/ecosystem.
Revenues are principally derived from the iPhone line of smartphones, the Macintosh family of notebook and desktop computers, iPad tablets, iPod portable digital music players, and the Apple Watch. The company also realizes revenue from software, peripherals, digital media and services. The technology giant has consistently churned out new products that the public loves, and an inexpensive iPhone is one of the newest offerings.
Apple stock investors currently receive a dividend of 0.54%. The company is expected to raise the dividend to $0.24 per share from $0.22. J.P. Morgan has an Outperform rating and a $210 price target. The consensus price target is $193.28, and the stock closed trading on Friday at $161.79, down almost 3% for the day.
Exxon Mobil
Despite the recent rally in oil, this mega-cap energy leader trades below levels posted in 2018 and still offers investors an excellent entry point. Exxon Mobil Corp. (NYSE: XOM) is the world’s largest international integrated oil and gas company. It explores for and produces crude oil and natural gas in the United States, Canada, South America, Europe, Africa and elsewhere.
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