The U.S. stock market has been experiencing significant volatility due to ongoing factors such as earnings season and the upcoming elections. This unpredictability in the market can make it challenging for investors to navigate and maintain stability in their portfolios. However, one strategy that can help smooth out these fluctuations is by investing in dividend-paying stocks.
Western Midstream Partners: A Strong Dividend Player
One of the top choices recommended by Wall Street analysts is Western Midstream Partners (WES), a limited partnership that owns and operates midstream assets across several states. WES recently increased its base distribution by 52% in Q1 2024, showcasing its commitment to rewarding investors. With a high dividend yield of 8.8%, WES has caught the attention of analysts like Gabriel Moreen, who raised his price target for the stock and reaffirmed a buy rating. Moreen believes that WES has the potential for further distribution hikes, making it an attractive option for investors looking for high-yield stocks.
Another energy player worth considering is Diamondback Energy (FANG), a company focused on onshore oil and natural gas reserves in the Permian Basin. FANG has been making headlines with its proposed acquisition of Endeavor Energy, a move that is set to enhance its market position. RBC Capital analyst Scott Hanold remains bullish on FANG, citing improved production and shareholder returns in his latest analysis. While there have been adjustments in Q2 2024 EPS and cash flow estimates, Hanold believes that FANG shares are poised to outperform the peer group in the coming months, making it a promising investment opportunity.
Lastly, beverage giant Coca-Cola (KO) presents a stable option for dividend investors. KO recently reported impressive second-quarter results, demonstrating robust demand for its products. The company also raised its full-year revenue and earnings outlook, reflecting its solid performance across markets. With a track record of consistent dividend hikes, KO offers a dividend yield of approximately 2.9%. RBC Capital analyst Nik Modi commended KO’s strong global case volumes and improved gross margin in his latest report. Despite challenges in certain consumer segments, Modi remains optimistic about KO’s ability to meet its targets for the year.
Dividend-paying stocks play a crucial role in providing stability and income for investors during volatile market conditions. By investing in companies like Western Midstream Partners, Diamondback Energy, and Coca-Cola, investors can benefit from consistent returns and long-term growth potential. The insights provided by top-ranked Wall Street analysts offer valuable guidance for investors looking to build a resilient and profitable portfolio.
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