We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
5 Dividend Growth Stocks to Buy for Gains in the 2nd Half
Wall Street has been roaring higher lately, driven by an AI-fueled rally and a pause in interest rates hike. However, the Fed’s hawkish stance for the rest of the year could again take the shine away from equities. Additionally, global slowdown concerns and geopolitical uncertainty remain. Amid such a scenario, dividend investing seems the best choice as it offers consistent and safe income.
Though the strategy does not offer dramatic price appreciation, it is a major source of consistent income for investors in any market. In particular, focusing on the growth level in this strategy leads to higher returns. Stocks with a strong history of year-over-year dividend growth form a healthy portfolio, with a greater scope of capital appreciation, as opposed to simple dividend-paying stocks or those with high yields.
We have selected five dividend growth stocks — Toll Brothers, Walmart Inc., Caterpillar Inc., W.W. Grainger Inc. and Novartis — that could be compelling picks heading into the second half.
Dividend Growth: Why a Win Strategy?
Stocks that have a strong history of dividend growth belong to mature companies, which are less susceptible to large swings in the market, and act as a hedge against economic or political uncertainty as well as stock market volatility. At the same time, these offer downside protection with their consistent increase in payouts.
Additionally, these stocks have superior fundamentals that make dividend growth a quality and promising investment for the long term. These include a sustainable business model, a long track of profitability, rising cash flows, good liquidity, a strong balance sheet and some value characteristics. Further, a history of strong dividend growth indicates that a dividend increase is likely in the future.
Although these stocks do not necessarily have the highest yields, they have outperformed for a longer period than the broader stock market or any other dividend-paying stock.
As a result, picking dividend growth stocks appears as a winning strategy when some other parameters are also included.
Here are the five of the 12 stocks that fit the bill:
Pennsylvania-based Toll Brothers builds single-family detached and attached home communities, master-planned luxury residential resort-style golf communities, and urban low, mid, and high-rise communities, principally on the land it develops and improves. TOL saw solid earnings estimate revision of $1.95 over the past 30 days for the fiscal year (ending October 2023) and has an expected earnings growth rate of 6.7%
Arkansas-based Walmart has evolved from being just a traditional brick-and-mortar retailer into an omnichannel player. It is engaged in the operation of retail, wholesale and other units worldwide. The company saw positive earnings estimate revision of a penny over the past 30 days for the fiscal year (ending January 2024) and delivered an average earnings surprise of 12.03% for the past four quarters.
Presently, WMT has a Zacks Rank #2 and a Growth Score of B.
Illinois-based Caterpillar is the largest global construction and mining equipment manufacturer. The company has an estimated earnings growth rate of 28.03% for this year and delivered an average earnings surprise of 14.27% for the past four quarters.
Caterpillar has a Zacks Rank #1 and Growth Score of B.
Illinois-based W.W. Grainger is a broad-line, business-to-business distributor of maintenance, repair and operating products and services. The company saw solid earnings estimate revision of 30 cents over the past 30 days for this year and has an estimated growth rate of 20.8%.
GWW has a Zacks Rank #1 and a Growth Score of A.
Switzerland-based Novartis has one of the strongest and broadest portfolios of oncology drugs and generics, which has enabled it to maintain its dominant position as a top pharma company over the years. The company saw solid earnings estimate revision of 7 cents over the past 30 days for this year and has an estimated earnings growth rate of 10.5%.
At present, NVS has a Zacks Rank #2 and a Growth Score of B.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer. Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Zacks.com featured highlights Toll Brothers, Walmart, Caterpillar, W.W. Grainger and Novartis
For Immediate Release
Chicago, IL – June 26, 2023 – Stocks in this week’s article are Toll Brothers (TOL - Free Report) , Walmart Inc. (WMT - Free Report) , Caterpillar Inc. (CAT - Free Report) , W.W. Grainger Inc. (GWW - Free Report) and Novartis (NVS - Free Report) .
5 Dividend Growth Stocks to Buy for Gains in the 2nd Half
Wall Street has been roaring higher lately, driven by an AI-fueled rally and a pause in interest rates hike. However, the Fed’s hawkish stance for the rest of the year could again take the shine away from equities. Additionally, global slowdown concerns and geopolitical uncertainty remain. Amid such a scenario, dividend investing seems the best choice as it offers consistent and safe income.
Though the strategy does not offer dramatic price appreciation, it is a major source of consistent income for investors in any market. In particular, focusing on the growth level in this strategy leads to higher returns. Stocks with a strong history of year-over-year dividend growth form a healthy portfolio, with a greater scope of capital appreciation, as opposed to simple dividend-paying stocks or those with high yields.
We have selected five dividend growth stocks — Toll Brothers, Walmart Inc., Caterpillar Inc., W.W. Grainger Inc. and Novartis — that could be compelling picks heading into the second half.
Dividend Growth: Why a Win Strategy?
Stocks that have a strong history of dividend growth belong to mature companies, which are less susceptible to large swings in the market, and act as a hedge against economic or political uncertainty as well as stock market volatility. At the same time, these offer downside protection with their consistent increase in payouts.
Additionally, these stocks have superior fundamentals that make dividend growth a quality and promising investment for the long term. These include a sustainable business model, a long track of profitability, rising cash flows, good liquidity, a strong balance sheet and some value characteristics. Further, a history of strong dividend growth indicates that a dividend increase is likely in the future.
Although these stocks do not necessarily have the highest yields, they have outperformed for a longer period than the broader stock market or any other dividend-paying stock.
As a result, picking dividend growth stocks appears as a winning strategy when some other parameters are also included.
Here are the five of the 12 stocks that fit the bill:
Pennsylvania-based Toll Brothers builds single-family detached and attached home communities, master-planned luxury residential resort-style golf communities, and urban low, mid, and high-rise communities, principally on the land it develops and improves. TOL saw solid earnings estimate revision of $1.95 over the past 30 days for the fiscal year (ending October 2023) and has an expected earnings growth rate of 6.7%
Toll Brothers has a Zacks Rank #1 and a Growth Score of B. You can see the complete list of today’s Zacks #1 Rank stocks here.
Arkansas-based Walmart has evolved from being just a traditional brick-and-mortar retailer into an omnichannel player. It is engaged in the operation of retail, wholesale and other units worldwide. The company saw positive earnings estimate revision of a penny over the past 30 days for the fiscal year (ending January 2024) and delivered an average earnings surprise of 12.03% for the past four quarters.
Presently, WMT has a Zacks Rank #2 and a Growth Score of B.
Illinois-based Caterpillar is the largest global construction and mining equipment manufacturer. The company has an estimated earnings growth rate of 28.03% for this year and delivered an average earnings surprise of 14.27% for the past four quarters.
Caterpillar has a Zacks Rank #1 and Growth Score of B.
Illinois-based W.W. Grainger is a broad-line, business-to-business distributor of maintenance, repair and operating products and services. The company saw solid earnings estimate revision of 30 cents over the past 30 days for this year and has an estimated growth rate of 20.8%.
GWW has a Zacks Rank #1 and a Growth Score of A.
Switzerland-based Novartis has one of the strongest and broadest portfolios of oncology drugs and generics, which has enabled it to maintain its dominant position as a top pharma company over the years. The company saw solid earnings estimate revision of 7 cents over the past 30 days for this year and has an estimated earnings growth rate of 10.5%.
At present, NVS has a Zacks Rank #2 and a Growth Score of B.
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
Click here to sign up for a free trial to the Research Wizard today.
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2112214/5-dividend-growth-stocks-to-buy-for-gains-in-the-second-half
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year.
Get it free >>
Follow us on Twitter: https://www.twitter.com/zacksresearch
Join us on Facebook: https://www.facebook.com/ZacksInvestmentResearch
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Contact: Jim Giaquinto
Company: Zacks.com
Phone: 312-265-9268
Email: pr@zacks.com
Visit: https://www.zacks.com/
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer. Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.