This article is based on five Kiplinger investing articles, aimed at finding the safe, durable, long-term, favorite, and solid dividend stocks.
The Kiplinger Dividend 15, by Ryan Ermey, published 7/6/20, “We divided these payers into three categories: stocks with a long history of stable dividends, stocks with the potential for rapid growth in their payouts, and high yielders.”
15 Super-Safe Dividend Stocks to Buy Now, by Dan Burrows published 7/2/20, “These are 15 of the safest dividend stocks to buy right now. Each stock has not only achieved a DIVCON 5 score, but a composite score within the top 10% of all stocks that DIVCON evaluated. This makes them the crème de la crème of dividend safety – and more likely to keep the dividend increases coming going forward.”
7 High-Dividend Stocks With durable Distributions, by Kyle Woodley, published 6/2/20 “Here are seven high-dividend stocks that have been identified for their payout strength. Nothing is certain, of course – so far this year, a few companies with well-funded distributions nonetheless pulled the plug to ensure their survival throughout the pandemic. Still, each stock has a rating of DIVCON 4, which signals a healthy dividend not just likely to survive, but to grow.”
13 Dividend Stocks That Have Paid Investors for 100+ Years, by Jeff Reeves, published 5/21/20, “Here are 13 dividend stocks that each boast a rich history of uninterrupted payouts to shareholders that stretch back at least a century.”
11 Monthly Dividend stocks and Funds for Reliable Income, by Charles Lewis Sizemore, CFA, published 5/11/20, “These monthly dividend stocks and funds fill a need for investors who not only require reliable regular income, but who want it paid out in alignment with their monthly expenses.”
Any collection of stocks is more clearly understood when subjected to yield-based (dog catcher) analysis, this collection of Kiplinger Dividend Specials is perfect for the dogcatcher process. Below are the July 20 data for 52 dividend stocks plus 4 ETFs.
The prices of 13 of these 56 dividend payers (listed by yield) Kiplinger Dividend Specials made the possibility of owning productive dividend shares from this collection more viable for first-time investors. Those 13 are EPD; GAIN; XOM; MAIN; PRU; UNM; PBCT; LTC; IPG; PFF; MET; SJR; STAG. All live up to the ideal of having their annual dividends from a $1K investment exceed their single share prices.
To learn which of those 13 are ‘safer’ dividend dogs, click here after July 26th, and see the special dividends “safer” article in my dividend dogcatcher marketplace Volio portfolio.
Actionable Conclusions (1-10): Analysts Estimated 14% To 44.59% Net Gains For Ten Top Dividend Special Stocks To August 2021
Four of ten top dividend special stocks by yield were among the top ten gainers for the coming year based on analyst 1-year target prices. (They are tinted gray in the chart below). Thus, the yield-based forecast for these June dogs was graded by Wall St. Wizards as 40% accurate.
Projections were based on estimated dividends from $1000 invested in each of the highest yielding stocks plus their aggregate one-year analyst median target prices, as reported by YCharts. Note: one-year target prices by lone analysts were not applied. Ten probable profit-generating trades projected to July 20, 2021 were:
Enterprise Products Partners L.P. (EPD) was projected to net $445.94 based on the median of target price estimates from twenty-five analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to risk/volatility 44% greater than the market as a whole.
Prudential Financial, Inc. (PRU) was projected to net $395.90 based on dividends, plus the median of target estimates from twenty-six brokers, less transaction fees. The Beta number showed this estimate subject to risk/volatility 11% more than the market as a whole.
Exxon Mobil Corp. (XOM) was projected to net $228.84, based on dividends, plus a median on the target price estimates from twelve analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 33% over the market as a whole.
Unum Group (UNM) was projected to net $215.57, based on dividends, plus median target price estimates from twelve analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 71% greater than the market as a whole.
Shaw Communications Inc. (SJR) was projected to net $210.58, based on dividends, plus the median of target price estimates from fourteen analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 40% less than the market as a whole.
Merck & Co, Inc. (MRK) was projected to net $189.32, based on dividends, plus the median of target price estimates from twenty analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 52% under the market as a whole.
MetLife, Inc. (MET) was projected to net $188.25, based on the median of target price estimates from fourteen analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to risk/volatility 34% greater than the market as a whole.
Lockheed Martin Corp. (LMT) was projected to net $180.09, based on a median of target price estimates from twenty-one analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 5% less than the market as a whole.
Coca-Cola Co. (KO) was projected to net $168.27, based on the median of target estimates from twenty-two analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 46% less than the market as a whole.
Realty Income Corp. (O) was projected to net $140.23, based on dividends, plus median target price estimates from twenty-three analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 32% less than the market as a whole.
The average net gain in dividend and price was estimated at 23.63% on $10k invested as $1k in each of these ten stocks. These gain estimates were subject to average risk/volatility 30% less than the market as a whole.
Actionable Conclusion (11): (Bear Alert) Analysts Predicted One Dividend Special Top Yield Dog To Average A 4.94% Loss to August 2021
The probable losing trade revealed by Y-Charts to 2021 was:
Texas Instruments Inc. (TXN) projected a loss of $49.35 based on dividend and a median of the target price estimates from thirty-two analysts including broker fees. The Beta number showed this estimate subject to risks 13% greater than the market as a whole.
The Dividend Dogs Rule
Stocks earned the “dog” moniker by exhibiting three traits: (1) paying reliable, repeating dividends, (2) their prices fell to where (3) yield (dividend/price) grew higher than their peers. Thus, the highest yielding stocks in any collection became known as “dogs.” More precisely, these are, in fact, best called, “underdogs.”
50 Kiplinger Dividend Special Stocks Per July 20 Target Gains
Source: KiplingerToday; YCharts.com
50 Kiplinger Dividend Special Stocks Per July 20 Yield
Source: KiplingerToday; YCharts.com
Actionable Conclusions (11-20): Ten Top Dividend Special Stocks By Yield
Top ten Kiplinger Dividend Special stocks represented five of eleven Morningstar sectors plus one ETF. First place went to the first of two energy representatives, Enterprise Products Partners L.P. . The other energy representative placed third, Exxon Mobil Corp. .
Second, and fourth through seventh places, were claimed by five financial services sector representatives, Gladstone Financial Corp. (GAIN) , Main Street Capital Corp. (MAIN) , Prudential Financial, Inc. , Unum Group , and People’s United Financial, Inc. (PBCT) .
Lastly, single real estate, communication services, and ETF equities occupied eighth through tenth places: LTC Properties, Inc. (LTC) ; The Interpublic Group Of Companies (IPG) , and iShares Preferred and Income Securities ETF (PFF) , to complete the Kiplinger Special Dividend top ten by yield field for August.
Actionable Conclusions: (21-30) Top Ten Dividend Special Stocks Showed 9.17-35.61% Upsides, While (31) Five Lowly Down-siders Ranged -0.06% to -9.33% As Of July 20
To quantify top dog rankings, analyst mean price target estimates provide a “market sentiment” gauge of upside potential. Added to the simple high-yield metrics, median analyst target price estimates became another tool to dig out bargains.
Analysts Forecast A 37.04% Advantage For 5 Highest Yield, Lowest Priced of 10 Dividend Special Stocks To August 2021
Ten top Kiplinger Dividend Special stocks were culled by yield for this update. Yield (dividend/price) results provided by YCharts did the ranking.
As noted above, top ten Kiplinger Dividend Special stocks screened 7/20/20, showing the highest dividend yields, represented five of eleven stocks in the Morningstar sector scheme plus one ETF.
Actionable Conclusions: Analysts Predicted 5 Lowest-Priced Of The Top Ten Dividend Special Stocks For Our Times (32) Delivering 18.11% Vs. (33) 13.21% Net Gains by All Ten Come August 2021
$5000 invested as $1k in each of the five lowest-priced stocks in the top ten Kiplinger Dividend Special kennel by yield were predicted by analyst 1-year targets to deliver 37.04% more gain than $5,000 invested as $.5k in all ten. The fifth lowest-priced selection, Enterprise Products Partners L.P., was projected to deliver the best net gain of 44.59%
The five lowest-priced top-yield Kiplinger Dividend Specials as of July 20 were: Gladstone Investment Corp.; People’s United Financial, Inc.; Unum Group; The Interpublic Group of Companies Inc.; Enterprise Products Partners L.P., with prices ranging from $10.02 to $17.83.
Five higher-priced Kiplinger Dividend Specials as of July 20 were: Main Street Capital Corp.; iShares Preferred and Income Securities ETF; LTC Properties, Inc.; Exxon Mobil Corp.; Prudential Financial, Inc., whose prices ranged from $30.88 to $63.02.
The distinction between five low-priced dividend dogs and the general field of ten reflected Michael B. O’Higgins’ “basic method” for beating the Dow. The scale of projected gains based on analyst targets added a unique element of “market sentiment” gauging upside potential. It provided a here-and-now equivalent of waiting a year to find out what might happen in the market. Caution is advised, since analysts are historically only 20% to 80% accurate on the direction of change and just 0% to 20% accurate on the degree of change.
The net gain/loss estimates above did not factor in any foreign or domestic tax problems resulting from distributions. Consult your tax advisor regarding the source and consequences of “dividends” from any investment.
This article features the 56 Kiplinger Dividend Special Stocks. The article focuses on the top 30, so nearly half the original list of companies is neglected. Therefore, below is the complete list of 56 stocks grouped by author
Stocks listed above were suggested only as possible reference points for your Kiplinger Dividend Special purchase or sale research process. These were not recommendations.
Graphs and charts were compiled by Rydlun & Co., LLC from data derived from www.indexarb.com; YCharts.com; finance.yahoo.com; analyst mean target price by Thomson/First Call in YahooFinance. Dog photo: youtube.com
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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Additional disclosure: Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsement to buy or sell any security. Prices and returns on equities in this article except as noted are listed without consideration of fees, commissions, taxes, penalties, or interest payable due to purchasing, holding, or selling same.