Identifying High-Yield Stocks
Investors often find allure in seeking bottomed-out stocks for a possible rebound, and when combined with a robust dividend yield, the strategy gains further appeal. Picture this: savoring dividends while patiently awaiting price recovery. Or view it from an income perspective – a chance to snag stocks at discount prices with the added delight of dividends during the hold. It’s a dual satisfaction.
Utilizing Barchart’s Stock Screener Tool, I scouted for stocks meeting specific criteria:
- 14-Day Relative Strength Index: Above 40%.
- Number of Analysts: 8 or more covering the stock.
- Current Analyst Rating: 3.5 (Moderate Buy) to 5 (Strong Buy).
- Annual Dividend Yield: 4% or more.
- Percent From Low: Within 5% of its 52-week low.
The relative strength index serves as a barometer, pinpointing stocks near oversold territory trending back toward bullish ranges.
From the scrutiny emerged four contenders. Regrettably, DIN and BHP, reliant on special dividends, were omitted. Let’s delve into the top three, commencing with the leader:
Apple Hospitality REIT (APLE)
14-day RSI: 40.73
Distinct from tech powerhouse Apple, Apple Hospitality carves a niche in upscale hospitality real estate, housing 224 hotels comprising over 30,000 rooms across 87 markets in 37 states. Brands under its wing include Hampton, Hilton, Hyatt, and Marriott.
The monthly dividend payer dishes out a 96-cent annual forward yield, translating to a current 6.89% yield. Trading near its 52-week low at $13.60 symbolizes a prime opportunity, as this figure marks its lowest value in three years, an invitation for bargain hunters.
United Parcel Service (UPS)
14-day RSI: 45.46
UPS, a global package delivery and supply chain juggernaut, offers a suite of services from freight forwarding to package delivery. Amid the trio, UPS stands out with a striking 15-year streak of dividend increases, currently offering a $6.52 annual rate at a 5.12% yield.
Temporarily stationed 3.48% above its 52-week low at $123.12, risk-takers have room for maneuver. Despite a slightly hefty dividend payout ratio of 89.34%, UPS serves longevity seekers well.
Nutrien (NTR)
14-day RSI: 41.52
Nutrien, an agricultural input provider, caters to a vast clientele base, boasting over half a million grower accounts worldwide. The leader in potash production with a presence in 40+ countries, Nutrien presently offers a solid $2.16 annual dividend, yielding 4.64% at current prices.
NTR orbits its 52-week low at $44.90, a scant 3.59% away, paving the way for savvy investors. Bolstered by the agricultural optimism wave, Nutrien’s industry stance and attractive metrics beckon contemplation, despite its relatively high dividend payout ratio of 121.46%.
Closing Thoughts
High-dividend stocks paint an enticing canvas for income seekers or retirement planners. With the allure of capital growth, the blend presents an attractive tapestry. Yet, remember the stock market’s inherent risks. Dive deep into due diligence, leveraging all tools to amplify potential gains.
