With the Federal Reserve expected to cut interest rates in September, dividend-paying stocks could be outperformers.
That’s because the dividend yields on these stocks look more attractive compared to the returns offered by other income-generating assets, including bonds.
Given the sheer number of companies that pay dividends, it can be difficult for investors to choose the right stocks. Investors may need to consider the recommendations of top analysts when choosing attractive dividend stocks with good financial standing.
Here are three Dividend stocksHighlights Wall Street’s Top Professionals TipRanks is a platform that ranks analysts based on their past performance.
EPR Properties
The first dividend stock of the week is EPR Properties (European Commission) is a real estate investment trust that focuses on experiential properties such as movie theaters, amusement parks, dining establishments, and ski resorts. EPR has a dividend yield of 7.3%.
RBC Capital Analyst Michael Carroll He recently upgraded EPR to Buy from Hold and raised his price target to $50 from $48, and believes the company has weathered a tough business environment that included the COVID-19 pandemic and the actors’ and writers’ strike.
Carroll believes EPR is positioned to perform well as the aforementioned headwinds abate. “We expect theatrical box office revenue to accelerate again in the second half of 2024 and 2025, leading to higher rent rates and a stronger tenant base,” the analyst said.
Regarding concerns about EPR’s large exposure to theaters, the analyst noted that management intends to reduce this exposure over time, adding that concerns about one of the company’s major tenants, AMC, appear to have been somewhat alleviated as AMC undertakes initiatives such as recapitalization and debt refinancing.
Finally, Carroll emphasized that EPR’s high dividend yield is well protected by an adjusted operating cash flow dividend payout ratio of approximately 70% and a solid balance sheet with a net debt to earnings before interest, taxes, depreciation and amortization ratio of 5.2x.
Carroll is ranked 703rd out of the 9,000+ analysts tracked by TipRanks. His ratings have been profitable 63% of the time and have delivered an average return of 7.7%. Ownership structure of EPR properties On TipRanks.
Energy Transfer
The next dividend candidate is Energy Transfer (E.T.) is a limited partnership. The midstream energy company paid a quarterly cash dividend of 32 cents per unit. August 19This reflects year-over-year growth of 3.2%. Energy Transfer has a dividend yield of 8%.
Stifel analysts react to ET’s second-quarter results Selman Akyol The company said it reported better-than-expected EBITDA and noted several growth opportunities across its value chain, primarily from the Permian to the Gulf Coast.
The outlook for natural gas is optimistic, as it is expected to supply a large portion of the energy needs of artificial intelligence data centers. Akyol stressed that ET’s management believes the company’s solid foundations will enable it to provide the natural gas needed to continuously power data centers.
Akyol noted that ET is also benefiting from increased demand from utilities, particularly in Texas and Florida, two states that offer attractive growth prospects for ET due to their data center potential and robust population growth.
“Energy Transfer is not taking any chances, and while the capital expenditure run rate could increase, we continue to like the company’s positioning,” Akyol said. He reaffirmed his buy recommendation on ET shares with a $19 price target.
Akuyol is ranked 137th among the 9,000+ analysts tracked by TipRanks. His ratings have been successful 71% of the time, delivering an average return of 10.3%. Energy Transfer Stock Chart On TipRanks.
Walmart
Large retail stores Walmart (WMT) recently surprised investors with strong second-quarter fiscal 2025 results. The company also raised its full-year outlook to reflect strong performance in the first half of the year.
Walmart continues to reward shareholders with dividends and share repurchases. In the first half of fiscal 2025, the company Over $3 billion Dividends and share buybacks $2.1 billionEarlier this year, Walmart The dividend was increased The dividend rose 9% to 83 cents a share, marking the company’s 51st consecutive year of dividend increases.
Following the second quarter announcement, Baird analysts Peter Benedict He reaffirmed his buy recommendation on Walmart and raised his price target to $82 from $70, noting that Walmart has gained market share despite a volatile macro environment thanks to its consistent focus on value and convenience.
The analyst said Walmart’s second-quarter performance clearly reflected the effectiveness of the company’s transformation efforts, with “approximately 70% of U.S. companion growth driven by digitalization and more than 50% of overall enterprise growth driven by digitalization.” [earnings before interest and taxes] Growth will come from higher margin advertising/membership revenue streams.”
Benedict also highlighted that Walmart’s return on investment over the past 12 months increased 10 basis points sequentially to 15.1%, an improvement driven by the company’s investments in areas such as automation and generative AI.
Benedict is ranked 35th among the more than 9,000 analysts tracked by TipRanks, and his ratings have been profitable 71% of the time, delivering an average return of 15.9%. Walmart’s share buyback On TipRanks.
