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8 Dividend Stocks To Buy The Week Of March 2nd

Mar. 02, 2020 4:56 AM ETCVX, FRT, GPC, MSM, SJM, SPY, TD, TU, VZ, TD:CA, T:CA15 Comments

Summary

  • Wealth isn't a great goal to pursue as an end in itself, but it is a necessary prerequisite for a great many desirable goals — both in society and personally.
  • The market began to falter on February 19th, when the Fed minutes revealed a plan (now likely scrapped) to curtail balance sheet expansion in April.
  • Last week's selloff merely returned the stock market to the peak it reached before the Fed's most recent asset purchases began filtering into stocks.
  • This week, I couldn't narrow down the list to only five names, because there are too many blue-chip dividend stocks available at attractive starting yields.
  • When the market melts down, focus on bolstering your portfolio's *quality* rather than its *yield.*.

Introduction

Every week, I try to find the five most opportunistic and timely dividend stocks to highlight as "buy" ideas and present them in these articles. This week, due to the rapid stock selloff, I just couldn't narrow it down to only five picks. So I'm presenting eight high-quality, undervalued dividend stocks that offer stellar starting yields.

There are many dividend stock "listicles" (list articles) on the Internet, but relatively few of them focus solely on stocks that are good values today. In a time of very low yields in both stocks and bonds, value investing becomes a vital way to generate a decent, reliable income stream.

That is as true for younger investors like me who focus on dividend growth and compounding as it is for retirees and near-retirees in search of current yield. So let's examine this week's picks and explore why they could make strong long-term dividend investments.

But first, a reminder of what investing is really all about.

Revolutions, Central Banks, and The Purpose of Wealth

In last week's 5 Dividend Stocks article, I argued that investors should adjust their view of wealth from the static, paper value of their total assets to the passive or semi-passive income generated from those assets.

If one's wealth is determined by the unrealized capital gains of central bank-inflated stocks, then one's wealth is liable to be halved in the next recession. But if one positions their portfolio in such a way as to generate adequate investment income for one's purposes without having to draw down on the principal, then the paper value of one's assets matter much less.

Admittedly, this isn't a revolutionary idea. It is how most rental property landlords already think. Since they can't see the fair market value of their properties on a daily, hourly, minutely basis, they mostly just think about

This article was written by

Austin Rogers profile picture
15.87K Followers

Austin Rogers is an REIT specialist with a professional background in commercial real estate. He writes about high-quality dividend growth stocks with the goal of generating the safest growing passive income stream possible. Since his ideal holding period is "lifelong," his focus is on portfolio income growth rather than total returns.

Austin is a contributing author for the investing group High Yield Landlord, one of the largest real estate investment communities on Seeking Alpha, with thousands of members. It offers exclusive research on the global REIT sector, multiple real money portfolios, an active chat room, and direct access to the analysts. Learn more.

Analyst’s Disclosure: I am/we are long SJM, FRT, MSM, GPC. 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.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (15)

j
Liked your article! Oil and gas probably at the best discounts and dividends now. I bought MLPX Friday at $10 and added to my BCX. Love sales and dividends.
l
Thank you for your quotations from "Silent Cal". Coolidge was a truly great and underappreciated man. Amity Shlaes' biography is worth reading.
Austin Rogers profile picture
Haven't read that one yet but it's on my "to-read" list! Coolidge is one of America's most "undervalued" presidents, in my opinion.
BM Cashflow Detective profile picture
@Cashflow Capitalist
A very nice to read and profound introduction to the topic idealism / materialism. It makes me think and I like it very much. That the pair of idealism and materialism works well is proven every day anew by all free countries with prosperity. But socialists ignore this proven causal link. With socialism everyone gets the same size pieces of an ever smaller cake. With capitalism, the smartest and hard-working get the biggest pieces from an exponentially larger cake. That is also my definition of justice. This is the logical and proven causal connection that no more rich person takes something away from a more poor person. Even the smallest pieces in a cake that is always getting bigger are still bigger than in a cake that is getting smaller. Unfortunately, the ignorance of the socialists is growing exponentially in the same way. Obviously also a causal connection. However, a wealth-destroying one. Look at the countries that have or had socialism. All poor and without materialism / idealism. Strive for it and enjoy your wealth. You have earned it. And don't let the ignorant pull you down or badly talk about your wealth. The American pursuit of materialism paired with idealism is in my opinion a role model for everyone. It makes no sense to separate it. Above all, there is a simple name for it. The American dream.

Two thirds of my portfolio is invested in the United States and I am very happy and proud at the same time to be able to say that I am allowed to participate with stocks in the American Dream in a capitalist way. This is my personal american dream. And I live it with absolute complete conviction.

Unfortunately it happens again and again that a materialistic intervention of the state happens. Indeed it leads to short-term impulses but at the price of long-term excessive debt. A good example of the constant repetition of misallocations. Ultimately, the disadvantages outweigh the short-term benefits. The human is a wonderful being. But you shouldn't expect too much in this regard by him. Unfortunately, the reality also repeatedly confirms that many people are simply not ready to learn. They would probably rather kill yourself than learn the right thing. It's very pity. The world would be even better off if it were the other way around.

The stocks you mentioned are nice examples to at least increase our own prosperity and to expand our cake exponentially. This will also indirectly improve everyone's prosperity. And the good thing about it is that you don't take anything away from anyone. The shares were sold voluntarily. They are not gone, they just belong to someone else.

Thanks for that and for this article. I recommend you literature from Ludwig von Mises. This will make your articles mybe even better in the future. Although this is actually no longer possible. ;-)
Austin Rogers profile picture
Thanks for your thoughts, @BM Cashflow Detective! Yep, I'm definitely a fan of Mises. Haven't read anything of his in a while, but I remember liking it.
t
Add: Abbv. pays a great dividend with plenty of upside.
M
Prefer dow member VZ, and Dividend aristocrat and dow member CVX, for DGI.
a
Very good list. I would add one name, PRU. A rated insurance company that is paying 5.83 percent dividend now at a 52 week low.
m
5.83 yield and a 10% raise last year as well. PRU is an unsexy business but one of the best DGI stocks right now.
Steady Income profile picture
I started accumulating PRU just the other day.
u
@aretailguy

Hard not to buy PRU at these prices.
BuddhaLove profile picture
Initiated a new position in $UPS last week and some more $CVS $MO $BRK.B $AVGO
LONG all those names
oldfatguy profile picture
BRK.B belongs in nobodies dividend portfolio
birder profile picture
I think your projection of at least 5% dividend growth for FRT is way too optimistic. During the past 5 years the dividend growth has been less than 4%. There is virtually no reason to think that it will be greater than that. None what so ever.
Austin Rogers profile picture
Analysts are expecting average FFO growth of 6.7% over the next five years, so I don't think an *average* dividend growth rate of 5% is outside the realm of possibility. See: finance.yahoo.com/...
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