In today’s volatile markets, investors are often on the lookout for dividend-paying stocks that not only provide income but also add stability to their portfolio during uncertain times. With a plethora of dividend-paying companies to choose from, selecting the right stocks can be a daunting task for many investors. This is where following the recommendations of Wall Street experts can come in handy. These experts conduct detailed analyses of a company’s earnings growth potential and dividend history to provide valuable insights to investors.
One of the top dividend picks recommended by Wall Street analysts on TipRanks is tech giant IBM (IBM), a company that recently announced mixed first-quarter results. Despite revenue falling short of estimates in the face of an uncertain macroeconomic backdrop, IBM’s earnings exceeded expectations. The company also made waves with its $6.4 billion acquisition of cloud software maker HashiCorp. IBM paid out dividends worth $1.5 billion in the first quarter alone, showcasing its commitment to rewarding shareholders.
IBM boasts a dividend yield of approximately 4%, making it an attractive option for income-seeking investors. Evercore analyst Amit Daryanani remains bullish on IBM, reiterating a buy rating on the stock with a price target of $215. Daryanani is optimistic about IBM’s ability to capitalize on various growth opportunities, including generative artificial intelligence and an uptick in consulting revenue. Despite challenges faced by the consulting business in the first quarter, Daryanani sees several catalysts that point towards increased growth in the coming quarters.
Another dividend stock that has caught the attention of Wall Street analysts is toymaker Hasbro (HAS), which reported better-than-expected first-quarter earnings thanks to its turnaround efforts. Hasbro paid out dividends totaling $97.2 million in the first quarter, offering investors a dividend yield of 4.7%. JPM analyst Christopher Horvers upgraded HAS stock to a buy rating from hold, setting a price target of $74, up from $61. Horvers’ estimates for Hasbro surpass consensus forecasts, as he believes the market is underestimating the company’s cost efficiency initiatives and prospects in digital gaming.
According to Horvers, Hasbro is well-positioned to benefit from a recovery in product categories with low ticket prices and short replacement cycles. The toymaker is also expected to see early benefits from improved merchandising under new management, enhancing its growth prospects in the latter half of 2024 and the first half of 2025. With the industry poised for improved growth in the coming year, Hasbro stands out as a promising investment opportunity.
Lastly, big-box retailer Target (TGT) has attracted the attention of Wall Street analysts as a top dividend stock. In the first quarter of 2024, Target distributed $508 million in dividends to shareholders, offering a dividend yield of 2.8%. Despite slightly missing analysts’ earnings per share expectations in the first quarter, Baird analyst Peter Benedict remains upbeat on Target’s growth prospects.
Benedict believes the post-earnings selloff in TGT stock was an overreaction to the company’s lower-than-expected earnings and price cuts. Target’s strategy of investing in value and affordability through low pricing aligns with its long-term goals for fiscal 2024. The company’s inventory remains well-maintained, and management’s focus on restoring positive comparable sales growth is seen as achievable in the near term. Overall, Benedict views the risk/reward profile of TGT stock as compelling and maintains a buy rating on the stock with a price target of $190.
These top dividend stocks recommended by Wall Street analysts present attractive investment opportunities for income-seeking investors. By following the insights and recommendations provided by seasoned analysts, investors can make informed decisions to bolster their portfolio and navigate through turbulent market conditions.