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Raymond James: 2 Big 7% Dividend Shares to Buy Now
Raymond James strategist, Tavis McCourt, sees the markets for the greatest opportunity and sees risk as well as opportunities in the current market conditions. In his opinion, the opportunity stems from the obvious factors: the Democrats won both the Senate of Georgia during the recent referendum, which gives the incoming Biden administration majority support in both Houses of Congress – thus increasing the chances of meaningful fiscal support is signed. law in the short term. More importantly, the coronavirus vaccination program continues and reports show that Pfizer’s vaccine, one of two approved in the United States, is effective against the new virus strain. A successful vaccination program will accelerate economic recovery, enabling states to relax lock-in regulations and get people back to work. The risks also come from political and public health areas. The House Democrats passed articles of accusation against President Trump, despite the immediate closure of his term, and the section reduces the chances of political reconciliation in a highly polarized environment. And although the COVID strain is similar to current vaccines, there is still a risk that a new strain will develop that is not covered by existing vaccinations – which could start the cycle of blockage and economic decline. Another risk that McCourt sees outside of these two is a sharp rise in inflation. He does not discount it, but probably will not consider it any time soon. “… product inflation / service inflation is only a possibility after reopening, so in the short term the market feels a bit bullet-free, and therefore the continued rally, with Dems winning the GA races, and only the fuel at the stimulus fire added, ”McCourt remarked. Some of McCourt’s colleagues under the Raymond James analyst squad keep these risks in mind and place their imprimatur on strong dividend stocks. We researched Raymond James’ recent calls and selected two high-yield dividend stocks using the TipRanks database. These buy values yield a dividend yield of 7%, which is a strong attraction for investors interested in using the current good times to set up a defensive firewall if the risks materialize. Enterprise Products Partners (EPD) We start in the energy sector, a business segment that has long been known for both high cash flow and high dividends. Enterprise Products Partners is a midstream company that is part of the network that moves hydrocarbon products from wells to storage sites, refineries and distribution points. The company controls more than 50,000 miles of pipelines, shipping terminals on the Gulf Coast of Texas and storage facilities for 160 million barrels of oil and 14 billion cubic feet of natural gas. The company was hurt in 1H20 by low prices and low demand, but partially recovered in the second half. Revenue reversed, rising 27% to $ 6.9 billion in the third quarter, respectively. The number was lower from year to year, by 5.4%, but came more than 6% above the Q3 forecast. Q3 earnings, at 48 cents a share, were just below forecast, but rose 4% year-on-year and 2%, respectively. EPD recently declared its dividend distribution of 4Q20, at 45 cents per ordinary share. This is higher than the previous payment of 44 cents, and this is the first increase in two years. At $ 1.80 on an annualized basis, the payment yields 7.9%. Among the bulls is Raymond James, Justin Jenkins, who considers EPD a strong buy. The analyst gives the stock a price target of $ 26, which implies a rise of 15% from current levels. (To view Jenkins’ performance history, click here). Jenkins said: “We believe EPD’s unique combination of integration, balance strength and ROIC record is the best in its class. We consider EPD to be the best position to withstand the volatile landscape … With EPD’s footprint, the increase in demand, the growth of the project and the contracted ramps more than just compensate for the headwind of supply and the lower returns for marketing results … “It is not often that analysts all agree on a stock, so when it happens happens, take note. The consensus rating of EPD’s strong buy is based on unanimous 9 buy. The average price target of $ 24.63 indicates an increase of 9% compared to the current share price of $ 22.65. (See EPD stock analysis on TipRanks) AT&T, Inc. (T) AT&T is one of the immediately recognizable stocks in the market. The company has long been a member of the S&P 500 and has a reputation as one of the best dividend payers in the stock market. AT&T is a true big-cap giant with a market capitalization of $ 208 billion and the largest network of mobile and landline telephony services in the US. The acquisition of TimeWarner (now WarnerMedia), which takes place in a process between 2016 and 2018, has given the company a major stake in the streaming business for mobile content. AT&T dropped revenue and earnings in 2020, under pressure from the corona pandemic, but the decline was modest, as the same pandemic also placed a premium on telecommunications and networking systems, which tended to hurt AT & T’s business. support. Revenue in the third quarter was $ 42.3 billion, which was 5% lower than in the previous quarter. On positive notes, the free cash flow yoy rose from $ 11.4 billion to $ 12.1 billion, and the company reported a net profit of 5.5 million new subscribers. Subscriber growth has been driven by the new 5G network development – and by premium content services. The company maintained its reputation as a dividend champion and made its last dividend statement for payment in February 2021. The payout, at 52 per ordinary share, is the fifth in a row at current levels and up to $ 2.08 annually, yielding 7.2%. By comparison, the average dividend among peer companies in the technical sector is only 0.9%. AT&T has kept its dividend strong for the past 12 years. Raymond James analyst Frank Louthan sees AT&T as a classic share of defense value and describes T’s current state as one with the bad news ‘baked in’. ‘[We] believe there is more that can go right over the next 12 months than could be worse for AT&T. Given the fact that stocks are very short, and we believe this is a recipe for upside. It’s hard to get names with capitalization values, and we think investors who can wait a few months for an average turnaround while closing a 7% return should be rewarded if they buy AT&T at the current level. , ” Louthan said. Consistent with these comments, Louthan T rates better (ie buy), and its $ 32 price target implies room for growth of 10% from current levels. (Click here to see Louthan’s record.) What does the rest of the street think? Looking at the consensus distribution, opinions of other analysts are more widespread. 7 Purchase upgrades, 6 investments and 2 sales increase a moderate buying consensus. In addition, the average price target of $ 31.54 indicates upward potential of ~ 9%. (See AT&T stock analysis on TipRanks) To find great ideas for dividend stocks trading at attractive valuations, visit TipRanks’ best-selling stocks, a newly launched tool that unites all TipRanks stocks. Disclaimer: The opinions expressed in this article are solely those of the proposed analysts. The content is for informational purposes only. It is very important to do your own analysis before investing.