With third-quarter earnings reporting seasons in full swing and the stock market catching a likely bear market rally, investors have seen, at least so far, reasonably good reports. With this week having another deluge of reports, including some big-tech numbers, all eyes remain focused on forward guidance. Given the big rally over the past few trading days, investors need to stay nimble, as many across Wall Street are expecting another leg down.
It makes sense now with stocks in rally mode to move from the momentum and meme stocks to more conservative large-cap stocks that pay dividends. We screened the Dow Jones industrials looking for the highest-yielding companies in sectors that look to benefit from solid demand, those that can do well even if a severe recession is on tap for 2023.
We only selected stocks that are rated Buy, as two of the highest-yielding stocks do not have a single analyst with a Buy rating. If nobody likes a stock, it likely has trouble below the surface. The ones we did select are rated Buy at major Wall Street firms. It is important to remember though that no single analyst report should be used as a sole basis for any buying or selling decision.
Stocks are listed from highest to lowest yield.
Verizon
This top telecommunications company offers tremendous value and passive income at current levels. Verizon Communications Inc. (NYSE: VZ) is one of the largest U.S. telecom companies. It provides wireless and wireline service to retail, enterprise and wholesale customers.
The company’s wireless network serves approximately 120 million mobile connections with 115 million postpaid subscribers. Its wireline business has undergone a period of secular decline due to wireless substitution and cable competition.
Verizon also provides converged communications, information and entertainment services over America’s most advanced fiber-optic network, and it delivers integrated business solutions to customers worldwide.
Verizon Communications stock investors receive a 7.38% dividend. Cowen has a $55 target price. The consensus target is $49.85, and shares ended Monday’s session trading at $35.97.
Dow
This stock certainly offers investors growth and income potential. Dow Inc. (NYSE: DOW) is a leading materials science company and was formed from the merger of Dow and DuPont in 2017 and the subsequent spin-off 2019. The company is organized into three principal divisions: Performance Materials & Coatings (23% of EBITDA), Industrial Intermediates & Infrastructure (27%) and Packaging & Specialty Plastics (51%).
Dow’s segments include Agricultural Sciences, which is engaged in providing crop protection and seed/plant biotechnology products and technologies, urban pest management solutions and healthy oils. The Consumer Solutions segment consists of Consumer Care, Dow Automotive Systems, Dow Electronic Materials and Consumer Solutions-Silicones businesses.
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