McDonald’s on Santa Monica Boulevard in Los Angeles, California on April 1, 2024.
Robert Gauthier | Los Angeles Times | Getty Images
With continued geopolitical tensions in the Middle East and economic uncertainty, investors looking for stable income can consider adding high-dividend stocks to their portfolios.
Picking the right stocks from the vast world of dividend-paying companies can be difficult. Recommendations from top Wall Street analysts can help investors choose stocks with attractive dividends backed by strong financials.
Here are three high-dividend stocks that are being watched by top Wall Street pros on TipRanks, a platform that ranks analysts based on past performance.
AT&T
Our first dividend pick is AT&T (T), one of the world’s leading telecommunications companies. The company announced last month that it would pay a quarterly dividend of $0.2775 per common share on November 1st. AT&T’s dividend yield is 5.2%.
Recently, Tigress Financial analyst Ivan Fainseth slightly raised his price target on AT&T stock from $29 to $30, reiterating his Buy rating, saying, “Wireless and wireline subscriber growth will push the company into a We will continue to position ourselves as a leading provider of integrated 5G and fiber optic services.” . ”
The analyst highlighted that AT&T reported net postpaid phone additions of 419,000 in the second quarter and an industry-leading postpaid phone churn rate of 0.70%. Additionally, AT&T Fiber net additions were 239,000, marking the 18th consecutive quarter with net additions exceeding 200,000.
Feinseth added that the company plans to connect more than 30 million consumer and business locations with its fiber optic network by the end of next year. The analyst is optimistic about AT&T’s future growth, backed by the continued rollout of 5G, fiber networks and broadband. He also expects the company to benefit from the iPhone upgrade cycle.
Additionally, Mr. Feinseth noted the company’s efforts to reduce costs and debt levels. Overall, analysts believe AT&T offers an attractive investment opportunity given its attractive dividend yield and resilient portfolio of businesses.
Mr. Feinseth is ranked #202 out of over 9,100 analysts tracked by TipRanks. His rating is profitable 61% of the time, with an average return of 13.2%. (See AT&T Stock Buyback on TipRanks)
real estate income
The second dividend stock of the week is Realty Income (O). Realty Income (O) is a real estate investment trust that invests in diversified commercial real estate, with a portfolio of more than 15,400 properties in the United States, United Kingdom, and six other European countries.
Realty Income is known for providing monthly dividends. The company announced a monthly dividend of $0.2635 per share on October 8th, with a payment date of November 15th. The stock has an attractive dividend yield of 5.1%.
RBC Capital analyst Brad Heffern recently updated his forecast and target price for the net lease REIT to reflect the impact of the low interest rate environment. Specifically, the analyst raised Realty Income’s price target from $64 to $67 and reaffirmed his buy rating on the stock. The higher target price means the company and its peers in the Net Lease REIT group benefit from a much lower cost of debt/equity.
Heffern cited the company’s bullish stance on real estate revenue as having one of the highest quality net lease portfolios and a high percentage of publicly reporting tenants. The analyst also expects the company to benefit from strong acquisition volumes.
“Company O’s cost of capital is one of the lowest in its peer group and, in our view, a low cost of capital is critical to operating on a net lease basis,” he added.
Mr. Heffern is ranked #542 out of over 9,100 analysts tracked by TipRanks. His rating is profitable 48% of the time, with an average return of 12.1%. (See Real Estate Income Stock Chart on TipRanks)
mcdonalds
Finally, let’s take a look at the fast food chain McDonald’s (MCD). Last month, the company announced a 6% increase in its quarterly dividend to $1.77 per share, payable on December 16th. This increase marks MCD’s 48th consecutive year of increased dividends. The dividend yield is 2.3%.
Baird analyst David Tarantino reaffirmed his buy rating on MCD stock and raised his price target from $280 to $320, citing signs of improving comparable sales growth in the U.S. . The analyst raised his third-quarter U.S. profit forecast to 0.5%, compared with previous expectations. 2% decrease.
Tarantino also raised his EPS forecast, driven by an improving trend in August and September following weakness at the end of the second quarter and beginning of the third. Analysts attribute the improvement in the U.S. competition to increased traction from the $5 Meal Deal, a collector’s meal promotion that launched on August 13 and reportedly sold out within a day or two, as well as from a year ago. We believe that this may have been facilitated by the ease of comparison. period.
Although macro challenges continue to draw attention outside the domestic market, Tarantino believes that “MCD’s durable business model positions it to generate relatively good results in a variety of economic scenarios.” The company maintains a bullish stance on the company’s stock.
Tarantino is ranked No. 162 out of more than 9,100 analysts tracked by TipRanks. His ratings were successful 66% of the time, with an average return of 13.7%. (See McDonald’s hedge fund activity on TipRanks)
