Drawing record numbers, 2021 was a great year for US stock markets with year-end rally pushing indexes to historic highs. Buoyed by an accelerating pace of immunization, strong fiscal stimulus packages, healthy labor market conditions, the Fed’s accommodative stance and robust economic expansion, the outgoing year appears to be in cruise mode. Moreover, the domestic home builder market is taking off, while an increase in consumer spending indicates strong macroeconomic momentum.
However, the dream period saw some of the scariest downturns and extreme market volatility in recent memories due to the re-emergence of the coronavirus, supply chain disruptions, inflationary pressure, and policy paralysis due to a lack of political consensus on broad-based issues. Additionally, mixed economic data at certain times has been misleading as it lacks clarity about the broader economic picture. Uncertainty about global macroeconomics and volatile oil prices have added to the dissonance.
Amidst the volatility of the broader stock market, a wise investment decision would be to focus on stocks that promise a steady stream of revenue with a healthy dividend yield. In addition to displaying the intrinsic value of such stocks, a healthy dividend yield would satiate the appetites of risk-averse investors. The fact that these stocks have the potential to outperform the market, while providing a decent dividend yield, has made them a valuable asset. With continued market volatility likely in 2022, Sunoco LP the sun, EPR . properties EPR, Oasis Midstream Partners LP OMP, PPL . company PPL, Arbor Realty Trust, Inc. April , Horizon Technology Finance Corporation HRZN and Dynex Capital, Inc. DX appears to be healthy bets.
Top 7 picks
With the help of Zacks Stock Screener, we chose Zacks stocks ranked #1 (strong buy) or #2 (buy) stocks that have a dividend yield of over 5%. In order to narrow down the list, we’ve taken those stocks with a market capitalization of over $100 million and a five-year average dividend yield of over 5%.
Based in Dallas, Texas, Sonoko It is among the largest distributors of automotive fuels in the US wholesale market by volume. The consumption of gasoline and diesel is expected to increase in the coming days with the increase in vaccinations against COVID-19. Increased fuel consumption and increased refining production in the domestic market are likely to increase demand for wholesale fuel distribution companies, leading to an increase in Sunoco’s distributable cash flow.
Sunoco has a market capitalization of $3.9 billion and a dividend yield of 8.4%. Zacks has been ranked No. 2 with an average dividend return of 11.5% over the past five years.
EPR . properties It operates as a leading real estate investment trust, focusing on real estate venues, which create value by facilitating leisure and recreation experiences outside the home, including movie theaters, ski resorts, leisure golf complexes and early childhood education centers. The company expects to see high demand for leisure travel due to accelerated vaccination and increased international demand, after the country reopens to international travelers.
EPR Properties has a Zacks No. 2 rating and a current dividend yield of 6.5%. you can see The full list of Zacks #1 stocks today is here. With a market capitalization of $3.5 billion, EPR has had an average dividend yield of 5% over the past five years.
Midway Oasis is a midstream company focused on the Williston and Delaware Basins. It operates primarily as an assembly and processing company but also provides a wide range of midstream services related to natural gas, crude oil and water. The proposed merger of Oasis Midstream with Oasis Petroleum Inc. To create a contiguous middle entity that is well positioned to drive value while increasing scope and diversifying the basins.
Oasis Midstream has a market capitalization of $1.1 billion and a dividend yield of 10.3%. Zacks’ ranked No. 2 company has had an average dividend return of 12.9% over the past five years.
Allentown, PA-based PPL . company is a diversified utility holding company, primarily generating electricity from power plants in the Northeast, Northwest, and Southeast of the United States. Thanks to the ongoing investments to strengthen its infrastructure, customers experience far fewer interruptions. PPL is likely to benefit from grid strengthening, electricity and gas distribution, electricity transmission, and expansion of renewable generation capacity.
PPL has a Zacks rating of #2 and a current dividend yield of 5.6%. With a market capitalization of $22.6 billion, the dividend yield has averaged 5.3% over the past five years.
Based in New York, Arbor Operating as a nationwide real estate investment trust, it manages a multi-billion dollar services portfolio and specializes in products for government-sponsored institutions. The company expects strong portfolio earnings, and strong contributions from the agency business to drive its business in 2022.
Arbor has a market capitalization of $2.6 billion and a dividend yield of 7.9%. Zacks’ ranked No. 2 company has an average dividend return of 9.4% over the past five years.
Headquartered in Farmington, Connecticut, Horizon Technology It operates as a leading specialist financing company that provides capital in the form of secured loans to venture capital-backed companies across various industries. A strong pipeline, backlog, and liquidity profile is likely to drive the growth of its net portfolio in 2022.
Horizon Technology has a Zacks #2 rank and a current dividend yield of 7.6%. With a market capitalization of $321.7 million, the average dividend yield is 10% over the past five years.
The headquarters is located in Glen Allen, Virginia. Dynix Capital It is an internally managed real estate investment trust, which invests in mortgage assets on the basis of leverage. The company is likely to benefit from the uneven transformation of the global economy and central bank strategies that are likely to create new risks and opportunities.
Dynex Capital has a Zacks rating of #2 and a current dividend yield of 9.4%. With a market capitalization of $611.6 million, the average dividend yield is 10.9% over the past five years.
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PPL Corporation (PPL): Free Stock Analysis Report
Sunoco LP (SUN): Free Stock Analysis Report
Arbor Realty Trust (ABR): Free Stock Analysis Report
Horizon Technology Finance Corporation (HRZN): Free Inventory Analysis Report
Features of EPR (EPR): Free Stock Analysis Report
Dynex Capital, Inc. (DX): Free Stock Analysis Report
Oasis Midstream Partners LP (OMP): Free Stock Analysis Report
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