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Keep An Eye on These 3 Energy Stocks With Juicy Dividend Yield
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Since the beginning of the COVID-19 pandemic, there have been wild fluctuations in oil prices in the market. This demonstrates that significant volatility is a fundamental aspect of the energy sector. Due to specific critical factors, dividend-yielding stocks within this sector exhibit comparatively lower volatility, positioning Exxon Mobil Corporation (XOM - Free Report) , Chevron Corporation (CVX - Free Report) and Phillips 66 (PSX - Free Report) for potential growth.
Extremely Volatile Energy Market
We should never forget how oil prices behaved since the beginning of the coronavirus outbreak. The initial pandemic period, when there were no vaccines, saw an environment of heightened uncertainties. The commodity’s price plunged to a negative $36.98 per barrel on Apr 20, 2020.
With the rapid development of vaccines by scientists, which in turn led to the gradual opening of the economies, the pricing scenario of West Texas Intermediate crude improved drastically over time to reach $123.64 per barrel on Mar 8, 2022. Oil price data are per the U.S. Energy Information Administration. Oil has currently touched $80 per barrel.
Dividend Stocks to Keep an Eye On
Overall oil pricing scenario seems scary, which could easily deter an investor from allocating money to energy companies. Despite this volatility constraint, investors could consider dividend-paying companies belonging to the industry. This is because companies with stable dividend-paying history are usually relatively less volatile than stocks with no dividend history. It is expected that companies that have been rewarding stockholders with dividends will try their best to continue paying at the same pace or higher, making the stocks attractive and less volatile to the vagaries of the market.
We have employed our Stock Screener to zero in on three such stocks. All the stocks carry a Zacks Rank #3 (Hold). With a dividend yield of more than 2%, all the companies have raised dividends in the past five years. With a payout ratio of less than 60%, the companies ensure sustainability with enough scope for future dividend increases.
3 Stocks to Gain
Chevron: It is a leading integrated energy company and has a solid balance sheet to support its future dividend increases. The company raised its quarterly dividend to $1.63 per share, reflecting an increase of almost 8% from the prior quarter’s levels. (Check Chevron’s dividend history here).
Phillips 66: Phillips 66 is a diversified energy manufacturing and logistic player with a presence in Midstream, Chemicals, Refining, and Marketing and Specialties businesses. With a strong focus on disciplined capital allocation and maintaining financial strength, PSX is well-positioned to continue rewarding shareholders with dividend growth. Phillips 66 pays a quarterly cash dividend on the common stock of $1.05 ($4.20 annualized) per share. (Check Phillips 66’s dividend history here).
ExxonMobil: It is among the largest integrated energy companies in the world and has raised its dividend at an average annual growth rate of 5.8% in the past 41 years. The energy major can rely on its strong balance sheet to withstand any business turmoil and hence can support future dividend payments. (Check ExxonMobil’s dividend history here).
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Keep An Eye on These 3 Energy Stocks With Juicy Dividend Yield
Since the beginning of the COVID-19 pandemic, there have been wild fluctuations in oil prices in the market. This demonstrates that significant volatility is a fundamental aspect of the energy sector. Due to specific critical factors, dividend-yielding stocks within this sector exhibit comparatively lower volatility, positioning Exxon Mobil Corporation (XOM - Free Report) , Chevron Corporation (CVX - Free Report) and Phillips 66 (PSX - Free Report) for potential growth.
Extremely Volatile Energy Market
We should never forget how oil prices behaved since the beginning of the coronavirus outbreak. The initial pandemic period, when there were no vaccines, saw an environment of heightened uncertainties. The commodity’s price plunged to a negative $36.98 per barrel on Apr 20, 2020.
With the rapid development of vaccines by scientists, which in turn led to the gradual opening of the economies, the pricing scenario of West Texas Intermediate crude improved drastically over time to reach $123.64 per barrel on Mar 8, 2022. Oil price data are per the U.S. Energy Information Administration. Oil has currently touched $80 per barrel.
Dividend Stocks to Keep an Eye On
Overall oil pricing scenario seems scary, which could easily deter an investor from allocating money to energy companies. Despite this volatility constraint, investors could consider dividend-paying companies belonging to the industry. This is because companies with stable dividend-paying history are usually relatively less volatile than stocks with no dividend history. It is expected that companies that have been rewarding stockholders with dividends will try their best to continue paying at the same pace or higher, making the stocks attractive and less volatile to the vagaries of the market.
We have employed our Stock Screener to zero in on three such stocks. All the stocks carry a Zacks Rank #3 (Hold). With a dividend yield of more than 2%, all the companies have raised dividends in the past five years. With a payout ratio of less than 60%, the companies ensure sustainability with enough scope for future dividend increases.
3 Stocks to Gain
Chevron: It is a leading integrated energy company and has a solid balance sheet to support its future dividend increases. The company raised its quarterly dividend to $1.63 per share, reflecting an increase of almost 8% from the prior quarter’s levels. (Check Chevron’s dividend history here).
Chevron Corporation Dividend Yield (TTM)
Chevron Corporation dividend-yield-ttm | Chevron Corporation Quote
Phillips 66: Phillips 66 is a diversified energy manufacturing and logistic player with a presence in Midstream, Chemicals, Refining, and Marketing and Specialties businesses. With a strong focus on disciplined capital allocation and maintaining financial strength, PSX is well-positioned to continue rewarding shareholders with dividend growth. Phillips 66 pays a quarterly cash dividend on the common stock of $1.05 ($4.20 annualized) per share. (Check Phillips 66’s dividend history here).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Phillips 66 Dividend Yield (TTM)
Phillips 66 dividend-yield-ttm | Phillips 66 Quote
ExxonMobil: It is among the largest integrated energy companies in the world and has raised its dividend at an average annual growth rate of 5.8% in the past 41 years. The energy major can rely on its strong balance sheet to withstand any business turmoil and hence can support future dividend payments. (Check ExxonMobil’s dividend history here).
Exxon Mobil Corporation Dividend Yield (TTM)
Exxon Mobil Corporation dividend-yield-ttm | Exxon Mobil Corporation Quote