In 2023, these 5 Top Dividend Stocks may do better.
- VF Corp (VFC): Although VFC has had a difficult year, the holiday season should help it comeback.
- Altria (MO): Altria’s high-yield dividend makes the company’s potential for a return highly appealing.
- Procter & Gamble (PG): Let 2022’s Procter & Gamble results lead the way for 2023.
- McDonald’s (MCD): The success of McDonald’s 2022 is due in large part to its successful business strategy.
- Chevron (CVX): Chevron has been a fantastic 2022 investment, and Q4 continues to indicate space for growth.
The 5 top Dividend Stocks for 2023 offer investors reliable means of defense against a number of existing challenges.
Their dividends add additional profits to portfolios that have suffered losses in an extremely challenging 2022. Additionally, they provide revenue that can be utilized to counteract the consequences of the persistently rising inflation that keeps nibbling away at finances.
In conclusion, dividend-paying companies are currently one of the best strategies available to stock investors. In economies that are doing well, the same holds true. Due to their propensity to do well across all markets, dividend stocks offer significant advantages from an investment standpoint that is long-term.
The fact that trustworthy, well-established businesses frequently pay dividends indicates that their business strategies are superior. And that is where investors ought to put their money.
VF Corp (VFC)
Even though the company’s earnings have decreased, its revenues are still expected to be steady for the rest of the fiscal year. As long as consumer sentiment doesn’t deteriorate, the company expects revenues to rise by 5-6% this year.
That appears to be the case thus far. The National Retail Federation predicts a strong holiday season with 6-8% more spending than in 2021.
Revenues from its North Face brand increased by 15% year over year in the first half. Products from the North Face could do well throughout the colder parts of this Christmas season. Yes, VFC has decreased significantly, and this shows that there is risk. However, it has a dividend yield of 6.03% and might perform well over the coming several months.
However, despite a sharp fall over the last ten years, smoking rates are still declining. This suggests that Altria, which is more dependent on cigarettes than any of its rivals in terms of revenue, must change course in order to stay relevant. If it does, investors will receive a high-yield dividend.
In reality, at 8.03%, the dividend is the highest on this list. Investors should be drawn to Altria because of its dividend and then hold out hope that the company would create items to diversify its source of income.
Phillip Morris will pay the business $2.7 billion in 2024 as compensation for a product collaboration. 10% of Anheuser-Busch Inbev is also owned by it that can be sold to raise money for the creation of smokeless products.
Investors might greatly gain from this.
Altria Group, Inc. is a holding company. The Company’s segments include smokeable products, and oral tobacco products. Its subsidiaries include Philip Morris USA Inc. (PM USA), which is engaged in the manufacture and sale of cigarettes in the United States, and John Middleton Co. (Middleton), which is engaged in the manufacture and sale of machine-made cigars and pipe tobacco. Its other operating companies include Philip Morris Capital Corporation, a subsidiary that maintains a portfolio of finance assets. It also owns interest in Helix Innovations LLC, which is engaged in the manufacture and sale of oral nicotine pouches. Other subsidiaries include Altria Group Distribution Company, which provides sales and distribution services to certain its operating subsidiaries, and Altria Client Services LLC, which provides various support services in areas, such as legal, regulatory, consumer engagement, finance, human resources and external affairs to the Company and its subsidiaries.
Procter & Gamble (PG)
When the dividend is taken into account, Procter & Gamble’s performance becomes even more favorable.
Each share of Procter & Gamble stock that was owned in 2022 received a dividend payment of $3.61. In light of that, the PG stock has only decreased by 6% this year, which is far less than the 15% reductions in the S&P 500.
The last time Procter & Gamble lowered its dividend was in 1957, making it incredibly stable.
Investors should be aware that Procter & Gamble does well no matter what occurs in 2023. Sales rose just 1% during the most recent financial reporting period, but EPS fell 2%. Investors may not find it particularly compelling, but this company is still considerably superior to many others, especially those operating in fast-growing industries like technology.
Since discretionary spending tends to decline during periods of weaker economic growth, MCD stock may discourage some investors.
Consumers tend to spend less money when they can, which negatively affects restaurant performance. Inflation frequently affects customers as well, increasing the cost of food. Consequently, whether restaurant stocks pay a dividend or not, there is even additional reason to disregard them.
However, McDonald’s differs from the typical restaurant stock in that it runs on a franchising business model.
Franchisee rents and royalties, which are based on sales, boost McDonald’s earnings. Therefore, McDonald’s can count on a sizable rental income in addition to receiving sizable royalties from its top-performing facilities. It’s a savvy business strategy that benefits the company greatly.
Therefore, the business will continue to be effectively protected from major problems until 2023 and beyond. This year, MCD stock has grown, making it a unique performer. It also pays a dividend of 2.22%.
McDonald’s Corporation (McDonald’s) operates and franchises McDonald’s restaurants. The Company’s restaurants serve a locally relevant menu of food and beverages. Its restaurants are owned and operated by independent local business owners. The Company’s segments include United States (U.S.), International Operated Markets (IOM) and International Developmental Licensed Markets & Corporate (IDL). The U.S. segment focuses on Company’s menu and offerings, as well as delivery and digital platforms. Its IOM segment includes its operations in markets, such as Australia, Canada, France, Germany, Italy, the Netherlands, Spain, and the United Kingdom. Its IDL segment includes its operations in markets, such as Latin America and Asia. Its digital offerings include drive thru, takeaway, delivery, curbside pick-up, and dine-in. Its menu includes hamburgers and cheeseburgers, Big Mac, Quarter Pounder with Cheese, Filet-O-Fish, wraps, shakes, soft drinks, coffee, McCafe beverages and other beverages.
One of the best-performing stocks in 2022 has been CVX. The oil and gas company has greatly benefited from volatile energy prices, which has led to outstanding earnings, particularly in the last two quarters.
Chevron reported $11.2 billion in earnings for the third quarter as increased oil prices benefited the company. Compared to the $6.1 billion in profits Chevron recorded a year earlier, that was a huge gain.
Due to the high share prices this year as a result of the outstanding performance, many investors have benefited enormously. In summary, CVX stock began trading at $103 in 2022 and is currently above $180. The good news is that analysts agree that CVX stock should continue to trade at $192 in the future.
According to EPS forecasts for Q4, the company’s good times aren’t done yet. Three months ago, analysts predicted that Chevron will report Q4 EPS of $4.48. That is at $4.51 after rising. With a payout ratio of 0.32, Chevron’s dividend is incredibly sustainable for the company and pays investors 3.12% in the future.
Chevron Corporation manages its investments in subsidiaries and affiliates, and provides administrative, financial, management and technology support to the United States and international subsidiaries that engage in integrated energy and chemicals operations. The Company operates through two business segments: Upstream and Downstream. The Upstream segment consists primarily of exploring for, developing and producing crude oil and natural gas; processing, liquefaction, transportation and regasification associated with liquefied natural gas; transporting crude oil by international oil export pipelines; transporting, storage and marketing of natural gas, and a gas-to-liquids plant. The Downstream segment consists primarily of refining of crude oil into petroleum products; marketing of crude oil, refined products and lubricants; manufacturing and marketing of renewable fuels; transporting of crude oil and refined products, and manufacturing and marketing of commodity petrochemicals.
Disclosure: We disclose that we do not own any shares of these 5 Top Dividend Stocks for 2023, either long or short, and that we have not received any payment for this article.
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