2 "Strong Buy" dividend stocks
2022 has already begun, and as predicted last year, the bull market is on a roll! The general consensus among financial experts is that this is yet another up year.
At a certain point, bulls and bears will need to reconsider their 8% dividend stocks options due to volatility. But if there ever was a good time to acquire stocks having value and growth prospects, 2022 is that year.
For investors that like to focus on strong buy stocks, the issue isn't finding value stocks. Identifying value stocks that have high growth prospects is the challenge.
When dealing with high-yield stocks, there's a need for an investor to focus on high-quality assets.
A good technique, as seen with the best monthly dividend stocks in 2021, is to shift attention to the S&P 500 constituents. Although this may crowd out some stocks like axis REIT, it does help in narrowing down the field. Below is a look at two 8% dividend stocks that offer excellent investment opportunities.
Pick #1: ONEOK
ONEOK is a name that continues to feature prominently among well-performing stocks. Before the onset of the COVID-19 pandemic, many categorized it as an all-around stock.
At the time, the stock was trading at $75, making it an excellent choice for investors looking for stocks with a standard dividend yield. It had a high-kick, high-yield growth that made it attractive.
The beginning of the pandemic changed all this, causing its prices to tank. Although its management had predicted a tough recovery during the earnings call, they were committed to its recovery.
Fortunately, its stock has since then risen by 112%.
Based on this, it's safe to say that OKE is one of those stocks you should consider buying. Presently, its stock sells at $60, making it a bargain purchase. But why buy it?
- It has a proven ability to grow its annual dividends
- It's historically undervalued
Pick #2: Philip Morris
Over the years, Philip Morris hasn't been a good investment, especially when looked at from a capital gains perspective. Its performance has remained at 50% of the S&P 500.
While this is one pick that may not work out immediately, it will undoubtedly work in the long term. If you're in doubt, look at the GEF stock dividend as an example.
PM has consistently yielded a dividend yield of 5.3%. Although this is less than its 10-year yield of 4.6%, historical data shows that it can easily trade at around $110.
The good news is that 2022 is a buyer's market for:
- Defensive stocks
- Value stocks
- Sin stocks
Looking into this, PM has continued to generate significant earnings despite the many "doomsday" scenarios people have been projecting.
As it continues to invest in reduced-risk products, the value of its stocks can only grow up. Its products have recorded significant growth in varied markets such as Japan.
Strong Buy Stocks – How to Invest in Them
As seen with the TRIN stock dividend, high dividend stocks are a good investment that can provide you with a regular income.
Such stocks typically distribute their annual earnings to their investors frequently. Most American dividend stocks tend to make predetermined quarterly payments to their investors. Leading stocks tend to increase these payouts over time. It enables investors to create an annuity-like cash stream.
Companies that make quarterly or annual dividend payments are all well-established. Investing in the two 8% dividend stocks mentioned above can help give your portfolio some much-needed stability.
It's why they have made it to this article on low-risk, high-yield stocks.
Best Monthly Dividend Stocks 2021 – Dividend Funds Vs. Dividend Stocks
Investors can use two methods to invest in dividend stocks:
- Through mutual funds, e.g., exchanged traded funds or index funds that hold dividend stocks
- By buying individual dividend funds
Index funds provide the investors with access to an extensive offering of dividend stocks.
A single transaction can assist you in acquiring a portfolio of dividend stocks. Your investment will allow you to earn dividend payouts on a routine basis.
You can take these payouts as a source of income or choose to reinvest them. On the other hand, dividend funds provide an investor with an opportunity to diversify their assets. For example, if a fund suspends its dividends, you still get to earn from the others.
Reinvesting the dividends through dividend funds or dividend stocks makes it easier to earn through a return on investment.
Dividend Yield Aristocrats and the Areas Where They Shine
If you're a high-yield dividend-seeking investor, you should concentrate on the stocks mentioned in this article. Apart from focusing on strong buy stocks, it would help to consider the consistency of the stocks in question.
Consistency is an essential factor for fixed-income investors.
And this is where the S&P 500 Dividend Aristocrats come in—it's a market index that includes select firms chosen from the S&P 500. For a firm to become considered, it must:
- Have a daily trading average volume of $5 million and above
- Hold a float-adjusted market capitalization of more than $3 billion
- Have consistently increased its dividends for at least 25 years
The methodology applied by this index requires at least 40 companies for it to work. Additionally, no single sector should account for over 30% of its total weight.
What Does This Mean for the 8% Dividend Stocks Investors?
The Dividend Aristocrats refers to big companies with high liquidity and reliable dividend payouts. Furthermore, this index on its own can provide better diversification compared to high-yield dividend indexes.
Such indexes tend to focus on the utilities and financial sectors. As an investor, you can choose to pick select Dividend Aristocrats. An alternative is to invest in EFTs using the same reliability-based criteria.
You may also want to consider investing in the S&P High-Yield Dividend Aristocrats index.
How You Can Invest in Strong Buy Stocks
It takes time and effort to create a portfolio of individual dividend stocks. But as many investors know, it's usually worth it in the end. Below is a look at how you can invest in high-performing stocks such as axis REIT.
1. Start by Finding a Dividend-Paying Stock
You can begin your search by screening financial sites for stocks that regularly pay their investors, e.g., GEF stock dividend. You could also scroll through your broker's website for other similar companies.
2. Carefully Evaluate the Stocks You Have Identified
The fastest way to evaluate a company is to compare it to its peers. For example, if you notice that its yield is higher than that of other similar companies, this could mean something isn't right.
Here, you may need to conduct more research on the company in question. For example, if you want to learn about TRIN stock dividends, ensure you research its safety and frequency of dividend payouts.
Consider its stock payout ratio as well. The ration can tell you more about its income.
3. Decide on the Amount of Stock to Buy
Investors purchasing individual stocks should consider diversifying. Diversification calls for one to determine the number of stocks to buy in each sector. If buying 20 stocks, consider getting 5% of each.
For the risky stocks, it will make more sense to pad your portfolio with some safer alternatives. Ensure you recalculate the cost basis before reinvesting the dividends you have earned.
Remember, dividend yields that are too high may prove unsustainable over time. The primary consideration when purchasing strong buy stocks is their safety. Carefully scrutinize all yields that are over 4%.
Additionally, tread lightly when dealing with stocks that have a yield of over 10%. Such stocks are risky and may prove to be a bad investment. Visit Xosignals.com today to learn more about dividends, stocks, and signals trading.
Start Getting Free Signals
10,040 registered users
550 users chatting now