I have written often about retirement portfolios and the dividend growth stocks that I like. (see here)
There is also some agreement among investors that dividend/growth blue chip stocks are the way to go forward during retirement and even when planning for retirement. Most of us agree that we can generate as much, if not more, income for life than with annuities and fixed income investments. (see here)
What I have been researching for several days now are several stocks that can be added to portfolios that fit the above criteria and are relatively inexpensive given the recent market turmoil and sell off.
Bear in mind that being conservative is just as important as the other considerations in this portfolio, and while nothing is ever risk free, I believe that the following stocks offer much of what income seeking investors want, with good potential for capital appreciation.
Two Stocks I Would Buy Now
1) Valero Energy (VLO): $20.23/share, 2.94% dividend yield, ESS rating- Very Bullish
Valero hit its 52 week high of $31/share back in April of this year. It beat last quarter's earnings estimates handily while recovering from a poor 2010. The ESS rating is almost at the extreme high end of its rating scale and VLO has returned its dividend to $.15/share (where it was in 2009) from $.05/share. VLO tripled its payout as soon as business got healthy. With a very strong balance sheet now, and improving business overall, VLO could increase its share price significantly over the next 12 to 24 months. While we wait, we get paid $.15/share.
2) Nippon Telegraph and Telephone (NTT): $24.15, 2.97% dividend yield, ESS rating- Very Bullish
Nippon Telegraph has the highest rating that Starmine gives; 10 on a scale of 1 to 10. Nothing tops it, period. It reached its all time high over $90/share back in 2000/2001, and has flat-lined ever since. It has managed to triple its dividend since that time and has a 5 year average dividend growth rate of 16.2% in spite of its underperforming share price. It pays its dividend semi annually, helping us wait patiently for its share price to rise, which I believe it will.
Both of these stocks fit my personal criteria of paying a solid dividend, through both good and bad times. Both have increased their dividends, and both companies are relatively inexpensive which could mean significant capital appreciation.
The analysts like them, they are both rated a strong buy by the ESS rating system, and can fit nicely into a balanced retirement portfolio as well as for investors simply seeking strong growth and income stocks.
Please do your own research on these companies prior to making any investment decisions.
Disclosure: I am long T. And I will more than likely add VLO and NTT to my core portfolio next week.