Actionable Conclusions (1-10): Analysts Estimated 16.87% To 37.07% Net Gains For Ten S&P 500 Dogs To April 2020
Four of ten top S&P 500 dividend stocks by yield were among the top ten gainers for the coming year based on analyst one-year target prices. (They are tinted gray in the chart below). Thus, this yield-based forecast for S&P 500 dogs was graded by Wall Street Wizards as 40% accurate.
Projections were based on estimated dividends from $1,000 invested in each of the highest yielding stocks and 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 April 1, 2020, were:
WRKCo Inc. (WRK) was projected to net $370.73 based on a median target price estimate from fifteen analysts plus the estimated annual dividend less broker fees. The Beta number showed this estimate subject to volatility 72% more than the market as a whole.
CenturyLink Inc. (CTL) was projected to net $274.621 based on a median target price estimate from sixteen analysts plus dividends less broker fees. The Beta number showed this estimate subject to volatility 22% less than the market as a whole.
Schlumberger Ltd. (SLB) was projected to net $263.81 based on dividends plus a mean target price estimate from thirty-five analysts less broker fees. The Beta number showed this estimate subject to volatility 34% more the market as a whole.
Newell Brands Inc. (NWL) was projected to net $244.25 based on a median target estimate from thirteen analysts plus dividends less broker fees. The Beta number showed this estimate subject to volatility 8% more than the market as a whole.
LyondellBasell Ind (LYB) was projected to net $244.25 based on dividends plus median target price estimate from seventeen analysts less broker fees. The Beta number showed this estimate subject to volatility 10% more than the market as a whole.
Nielsen Holdings PLC (NLSN) was projected to net $231.06 based on the median target price estimate from seventeen analysts plus annual dividend less broker fees. The Beta number showed this estimate subject to volatility 10% less than the market as a whole.
AbbVie Inc. (ABBV) netted $196.61 based on a median estimate from eighteen analysts plus dividends. The Beta number showed this estimate subject to volatility 17% more than the market as a whole.
The Interpublic Group (IPG) was projected to net $196.48 based on dividends plus the median target price estimate from thirteen analysts less broker fees. The Beta number showed this estimate subject to volatility 7% more than the market as a whole.
Occidental Petroleum (OXY) was projected to net $173.03 based on dividends plus a mean target price estimate from twenty-five analysts less broker fees. The Beta number showed this estimate subject to volatility 17% less than the market as a whole.
Macerich Co. (MAC) was projected to net $168.67 based on dividends plus a median target estimate from nineteen brokers less transaction fees. The Beta number showed this estimate subject to volatility 12% less than the market as a whole.
The average net gain in dividend and price was estimated at 29.53% on $10k invested as $1k in each of these ten stocks. These gain estimates were subject to average volatility 9% 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".
69 Top S&P 500 Dividend Stocks By Yield
Actionable Conclusions (11-20): 10 Top S&P 500 Dividend Stocks By Yield
Top ten S&P 500 stocks selected 3/28/19 by yield represented six of eleven Morningstar sectors. First place was claimed by one of two communication services sector representatives, CenturyLink Inc. . The other was placed fifth - AT&T Inc. (T) .
In second place was one of two real estate sector representatives - Macerich Co . Its counterpart was placed eighth - Kimco Realty Corp. (KIM) ,
Two industrials sector reps placed third and tenth - Iron Mountain Inc. (IRM) , and Nielsen Holdings PLC . Two from the consumer cyclical sector placed fourth and sixth - Ford Motor Co. (F)  and Macy's Inc. (M) .
Finally, in seventh place was a financial services representative - Invesco Ltd. (IVZ)  and, in ninth place, the consumer defensive stalwart, Newell Brands Inc.  to complete the S&P 500 top ten by yield for April.
Actionable Conclusions: (21-30) Top Ten S&P 500 Dogs Showed 8.71% To 36.4% Upsides To April 2020; (31) Five Lowly Downsiders Ranged -0.92% To -5.75%.
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, analyst mean price target estimates became another tool to dig out bargains.
Analysts Forecast A 1.69% Disadvantage For 5 Highest Yield, Lowest Priced S&P 500 Dividend Stocks To April 2020
Ten top S&P 500 dividend dogs were culled by yield for this monthly update. Yield (dividend/price) results verified by YCharts did the ranking.
As noted above, top ten S&P 500 dividend dogs selected 3/28/19 showing the highest dividend yields represented six of eleven in the Morningstar sector scheme.
Actionable Conclusions: Analysts Predicted 5 Lowest-Priced Of the Top Ten Highest-Yield S&P 500 Dogs (32) Delivering 16.17% Vs. (33) 16.45% Net Gains by All Ten Come April 2020
$5,000 invested as $1k in each of the five lowest-priced stocks in the top ten Dividend S&P 500 kennel by yield were predicted by analyst one-year targets to deliver 1.69% less gain than $5,000 invested as $.5k in all ten. The second lowest priced selection, CenturyLink Inc., was projected to deliver the best net gain of 28.46%.
The five lowest-priced top-yield S&P 500 dividend dogs as of March 28 were: Ford Motor Co., CenturyLink Inc., Newell Brands Inc., Kimco Realty Corp., and Invesco Ltd., with prices ranging from $8.77 to $19.37.
Five higher-priced S&P 500 dividend dogs as of March 28 were: Nielsen Holdings PLC, Macy's Inc., AT&T Inc., Iron Mountain Inc., Dominion Energy Inc. (D), and Macerich Co., with prices ranging from $23.66 to $43.41.
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.
Stocks listed above were suggested only as possible reference points for your S&P 500 stock purchase or sale research process. These were not recommendations.
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Disclosure: I am/we are long T. 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.
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: quotesgram.com