As investors navigate uncertain markets in the short term, dividend-paying stocks can provide stability and income for portfolios. Wall Street’s top experts on TipRanks, a platform that ranks analysts based on their past performance, have identified three attractive dividend stocks. One of these stocks is Civitas Resources (CIVI), an independent oil and natural gas producer focused on developing assets in the Permian and Denver-Julesburg basins.

Civitas recently paid a quarterly dividend of $1.59 per share on December 29, 2023. This dividend consisted of a base dividend of $0.50 per share and a variable dividend of $1.09 per share. Mizuho analyst Nitin Kumar upgraded Civitas stock to a buy rating from hold and set a price target of $86 per share. Kumar believes that 2023 was a transformative year for the company, with three major acquisitions in the Permian Basin reshaping its asset base. As a result, Civitas now has an overall inventory duration of nearly 10 years, making it more competitive than its small and mid-cap rivals.

Despite the positive developments, Civitas still trades at a significant discount compared to its peers based on metrics such as FCF/EV and EV/EBITDAX. Kumar believes that the relative valuation gap is too wide considering the company’s improved asset base and expanded inventory duration.

Williams Companies (WMB)

Another energy dividend stock worth considering is Williams Companies (WMB), an energy infrastructure company responsible for handling about one-third of the natural gas shipped in the U.S. The company paid a quarterly dividend of $0.4475 per share on December 26, 2023, representing a 5.3% year-over-year growth. Williams currently offers a dividend yield of 5.1%.

Williams recently acquired a portfolio of natural gas storage assets from Hartree Partners LP’s affiliate for $1.95 billion. Stifel analyst Selman Akyol expects this acquisition, which includes six natural gas facilities, to be favorable due to the assets’ access to LNG export facilities. Akyol believes that this purchase will enhance Williams’ storage capabilities to meet the growing LNG demand. Additionally, the acquisition positions the company to provide fuel for standby power plants as the world transitions to renewables.

Akyol reiterated a buy rating on WMB stock with a price target of $40. He highlighted the company’s diversified gathering footprint, ownership of the largest U.S. long-haul natural gas pipeline in Transco, and over 90% fee-based margins. Akyol also emphasized Williams’ top-tier distribution coverage, investment-grade balance sheet, attractive yield, and ability to generate stable cash flows despite macro challenges.

Kimco Realty (KIM)

Kimco Realty (KIM) is a real estate investment trust (REIT) that focuses on grocery-anchored shopping centers. The company recently paid a quarterly cash dividend of $0.24 per share in December 2023, reflecting a 4.3% increase from the previous dividend payment. Kimco Realty currently offers a dividend yield of 4.7%.

After completing the acquisition of RPT Realty, Stifel analyst Simon Yarmak reaffirmed a buy rating on KIM stock and raised the price target to $23 per share. Yarmak noted that management is optimistic about increasing occupancy levels in RPT’s portfolio, improving margins, and maintaining a solid signed-not-opened (SNO) portfolio. He also mentioned that the company’s exposure to Rite Aid, which filed for bankruptcy in 2023, remains minimal.

Yarmak believes that Kimco Realty’s portfolio is stable and has significant size and scale in its target markets. He increased his 2024 FFO (funds from operations) per share estimate to $1.62 from $1.61 and his 2025 estimate to $1.69 from $1.68. The analyst expects 2023 FFO of $1.57 per share. Yarmak highlighted that KIM is focused on executing value creation opportunities within its portfolio to drive NOI (net operating income) and cash flow growth.

Analysts on Wall Street have identified Civitas Resources (CIVI), Williams Companies (WMB), and Kimco Realty (KIM) as attractive dividend stocks. These companies operate in different sectors, including oil and gas production, energy infrastructure, and real estate investment. The analysts believe that these stocks offer stability and income for investors in uncertain market conditions. However, it’s important for investors to conduct their own research and consider their individual financial goals and risk tolerance before making any investment decisions.

Investing

Articles You May Like

The Rise of Ethereum ETFs in the U.S.
The Real Estate Market Shift: A Closer Look
Planning for Retirement: A Critical Look at Gen Xers’ Milestones
UPS Second Quarter Report Analysis

Leave a Reply

Your email address will not be published. Required fields are marked *