Dive Into Dividends: 14 Must-Have Stocks When Markets Dip

Oct. 03, 2023 5:00 AM ET61 Comments

Summary

  • Stable and reliable dividend stocks with strong yields and significant dividend growth can help insulate from inflationary pressures, portfolio losses, and market volatility.
  • Dividend investors know chasing yield is risky. Opportunity can be found by identifying durable dividend growth stocks that pull back with market dips.
  • YTD, many dividend stocks are beaten down. I have 14 stock picks with an average yield (TTM) of 3.74% vs. the VIG yield at 1.99% and SPY yield at 1.53%.
  • The stocks possess three-year dividend growth rates ranging from 3.74% to 29%, all rated strong buys. Each stock was picked using our screener, which can quickly validate stocks with strong dividend growth while flagging stocks with at-risk dividends.
  • Where many stocks have cut dividends this year amid rising interest rates and debt, each of my 14 stocks offers significant dividend growth rates and is collectively strong on value, growth, profitability, earnings revisions, and momentum attributes.

Growing bar graph from US dollar banknotes

DavidLeshem

Why Dividend Investing Matters: Growth

Dividend stocks can be a great option for investors looking for steady income streams or a hedge against inflation, but only some stocks pay dividends. In a high-interest rate environment, some companies are impacted by slowing economic

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Steven Cress is VP of Quantitative Strategy and Market Data at Seeking Alpha. Steve is also the creator of the platform’s quantitative stock rating system and many of the analytical tools on Seeking Alpha. His contributions form the cornerstone of the Seeking Alpha Quant Rating system, designed to interpret data for investors and offer insights on investment directions, thereby saving valuable time for users. He is also the Founder and Co-Manager of Alpha Picks, a systematic stock recommendation tool designed to help long-term investors create a best-in-class portfolio.

Steve is passionate and dedicated to removing emotional biases from investment decisions. Utilizing a data-driven approach, he leverages sophisticated algorithms and technologies to simplify complex, laborious investment research, creating an easy-to-follow, daily updated grading system for stock trading recommendations.

Steve was previously the Founder and CEO of CressCap Investment Research until its acquisition by Seeking Alpha in 2018 for its unparalleled quant analysis and market data capabilities. Prior to that, he had also founded the quant hedge fund Cress Capital Management, after spending most of his career running a proprietary trading desk at Morgan Stanley and leading international business development at Northern Trust.

With over 30 years of experience in equity research, quantitative strategies, and portfolio management, Steve is well-positioned to speak on a wide range of investment topics.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. 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 that any particular security, portfolio, transaction or investment strategy is suitable for any specific person. The author is not advising you personally concerning the nature, potential, value or suitability of any particular security or other matter. You alone are solely responsible for determining whether any investment, security or strategy, or any product or service, is appropriate or suitable for you based on your investment objectives and personal and financial situation. Steven Cress is the Head of Quantitative Strategy at Seeking Alpha. Any views or opinions expressed herein 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.

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