While many analysts are hopeful for a gradual global economic recovery this year, the financial markets are expected to remain volatile on several grounds, including the effectiveness (or not) of current COVID-19 vaccination efforts, additional fiscal stimulus measures, changes in economic indicators under the new U.S. Presidential administration, and occasional profit taking. All this, along with…
paltry yields on savings due to a low interest rate environment makes a strong case for dividend investing.
Though a pandemic-driven recession forced many dividend-paying companies to slash or discontinue payouts, the wildly divergent impact of the pandemic on different sectors of the economy has meant that some companies have been able to maintain or raise their dividend payments while others have not. So, obviously, it is wise to target dividend stocks that have a history of paying steady or increased dividends.
In addition to a steady dividend income, we think the sound fundamentals of these four companies should lead to capital appreciation. The impressive performance of dividend stocks is evident in the SPDR Portfolio S&P 500 High Dividend ETF’s (SPYD) 34.4% returns over the past nine months.
Exxon Mobil Corporation (XOM – Get Rating), AT&T, Inc. (T – Get Rating), Total, SA (TOT – Get Rating), and British American Tobacco Industries (BTI – Get Rating) not only offer high dividend yields but also hold upside potential. Moreover, these companies have a solid history of paying dividends.
XOM is involved in the exploration, production, and sale of natural gas and crude oil. The company has international operations. Over the past six months, XOM’s stock has gained 8.8%.
The company recently announced that it plans to reduce its greenhouse gas emissions in keeping with the Paris Accords. This strategy could help the company’s long-term sustainability. XOM has also recently discovered hydrocarbons off the coast of Suriname.
XOM declared a dividend of $0.87 per share for the last quarter. This is an increase of 6.1% from the earlier dividend amount. XOM’s dividend payout grew at a CAGR of 3.86% over the past five years. The company has an annual dividend yield of 7.34%. The company’s four-year average yield is 5.26%.
XOM is expected to see a revenue growth of 23.7% in 2021. Its EPS is estimated to grow 670.6% in 2021 and at a rate of 14.6% per annum over the next five years.
T delivers telecommunication services in the U.S. and internationally. The company’s services include wireless communication, video services, data and broadband services. T’s stock has returned 2.3% over the past three months.
The company is currently involved in the deployment of 5G+ networks in airports around the United States. It is collaborating with 100 Thieves, a gaming organization and lifestyle brand, as its official sponsor.
For the last quarter, T declared a dividend per share of…
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