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 6/2/20, “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 Outstanding Dividend Dogs are perfect for the dogcatcher process. Below are the September 22 data for 52 dividend stocks plus 4 ETFs.
The prices of 12 of these 56 (listed by yield) Kiplinger Outstanding Dividends made the possibility of owning productive dividend shares from this collection more viable for first-time investors. Those 13 are EPD, XOM, GAIN, MAIN, PBCT, UNM, LTC, IPG, PFF, MET, SJR, STAG. They all live up to the ideal of having their annual dividends from a $1K investment exceed their single share prices. Many investors see this condition as a buy signal.
Actionable Conclusions (1-10): Analysts Estimated 23.49% To 64.5% Net Gains For Ten Top Outstanding Dividend Stocks To September 2021
Five of ten top outstanding dividend 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 October dogs was graded by Wall St. Wizards as 50% 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 September 22, 2021, were:
Enterprise Products Partners L.P. (EPD) was projected to net $645.05 based on the median of target price estimates from twenty-three analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to risk/volatility 42% greater than the market as a whole.
Exxon Mobil Corp. (XOM) was projected to net $469.83, based on dividends, plus a median on the target price estimates from twenty-six analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 26% over the market as a whole.
Unum Group (UNM) was projected to net $304.73, based on the median of estimates from ten analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 70% greater than the market as a whole.
Shaw Communications Inc. (SJR) was projected to net $285.65, based on dividends, plus the median of target price estimates from thirteen analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 37% less than the market as a whole.
AbbVie Inc. (ABBV) was projected to net $280.32 based on dividends, plus the median of target estimates from eighteen brokers, less transaction fees. The Beta number showed this estimate subject to risk/volatility 24% less than the market as a whole.
People’s United Financial (PBCT) was projected to net $278.15, based on dividends, plus median target price estimates from fourteen analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 20% greater than the market as a whole.
The Interpublic Group (IPG) was projected to net $274.22, based on the median of target estimates from thirteen analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 2% less than the market as a whole.
MetLife, Inc. (MET) was projected to net $268.49, based on the median of target price estimates from thirteen analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to risk/volatility 30% greater than the market as a whole.
Chubb Ltd. (CB) was projected to net $255.27, based on dividends, plus median target price estimates from twenty analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 36% less than the market as a whole.
Blackstone Group Inc. (BX) was projected to net $234.88, based on dividends, plus the median of target price estimates from nineteen analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 30% over the market as a whole.
The average net gain in dividend and price was estimated at 32.97% on $10k invested as $1k in each of these ten stocks. These gain estimates were subject to average risk/volatility 12% more 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.”
52 Kiplinger Special Dividend Stocks Per September 22 Target Gains
56 Kip Special Dividend Stocks Per September 22 Yield Data
Actionable Conclusions (11-20): Ten Top Outstanding Dividend Stocks By Yield
Top ten Kiplinger Outstanding Dividend stocks represented four of eleven Morningstar sectors plus one fund. First place went to the first of two energy representatives, Enterprise Products Partners LP . The other energy representative placed second, Exxon Mobil Corp. .
Third through seventh places were claimed by five financial services sector representatives, Gladstone investment Corp. (GAIN) , Main Street Capital Corp. (MAIN) , People’s United Financial Inc., Prudential Financial, Inc. (PRU) , and Unum Group .
Lastly, single real estate, communication services, and ETF equities occupied eighth, ninth, and tenth places: LTC Properties Inc. (LTC) ; The Interpublic Group Of Companies (IPG) , and iShares Preferred and Income Securities ETF (PFF) , to complete the Kiplinger Outstanding Dividend top ten by yield field for October.
Actionable Conclusions: (21-30) Top Ten Outstanding Dividend Stocks Showed 20.86-54.38% Upsides While (31) One Lowly Down-sider Settled For -0.50% As Of September 22.
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 29.99% Advantage For 5 Highest Yield, Lowest Priced of 10 Outstanding Dividend Stocks To October 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 9/22/20, showing the highest dividend yields, represented four of eleven stocks in the Morningstar sector scheme plus one ETF.
Actionable Conclusions: Analysts Predicted 5 Lowest-Priced Of The Top Ten Highest-Yield Outstanding Dividend Stocks (32) Delivering 31.91% Vs. (33) 24.55% Net Gains by All Ten Come October 2021
$5000 invested as $1k in each of the five lowest-priced stocks in the top ten Kiplinger Outstanding Dividend kennel by yield were predicted by analyst 1-year targets to deliver 29.99% more gain than $5,000 invested as $.5k in all ten. The third lowest-priced selection, Enterprise Products Partners LP, was projected to deliver the best net gain of 64.51%.
The five lowest-priced top-yield Kiplinger Dividend Specials as of September 22 were: Gladstone Investment Corp.; People’s United Financial Inc.; Enterprise Products Partners LP; The Interpublic Group of Companies Inc.; Unum Group, with prices ranging from $9.19 to $16.84.
Five higher-priced Kiplinger Dividend Specials as of September 22 were: Main Street Capital Corp.; LTC Properties Inc. (LTC); Exxon Mobil Corp.; iShares Preferred and Income Securities ETF; Prudential Financial Inc., whose prices ranged from $29.95 to $63.71.
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 Outstanding Dividend 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.
If somehow you missed the suggestion of which stocks are ripe for picking at the start of this article, here is a reprise of the list at the end:
The prices of 12 of these 56 dividend payers (listed by yield) Kiplinger Outstanding Dividend Stocks made the possibility of owning productive dividend shares from this collection more viable for first-time investors. Those 12 are EPD, GAIN, XOM, MAIN, PBCT, LTC, UNM, IPG, PFF, MET, SJR, STAG. They all live up to the ideal of having their annual dividends from a $1K investment exceed their single share prices, and many investors see this condition as a buy signal.
Stocks listed above were suggested only as possible reference points for your 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: publicdomainpictures.net
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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.