Identifying the right dividend stock for your investment strategy can be like finding a needle in a haystack. You know you want an equity that makes regular cash payouts — but where do you go from there?
After all, nearly 2,000 U.S. common stocks pay a dividend. And another 800 U.S.-listed international dividend stocks.
The MarketBeat Dividend Screener, a beneficial resource, allows you to sift through the enormous dividend pile to find stocks that best fit your style. From market cap and sector to payout ratio and dividend growth, it includes a variety of filters that quickly generate a more manageable "short list" of ideas. MarketBeat subscribers get the added benefit of being able to export their screener results. Call it the gold-plated pitchfork of dividend screening tools.
As investors and content creators, we constantly look for interesting dividend stock ideas. A recent visit to the dividend screener had us searching for something unusual.
We wondered, what dividend-paying companies have had positive media coverage of late? Our thought process was that this could lead us to stocks with reliable cash distributions and the potential for significant share price appreciation.
To produce this list, we filtered large-cap companies and included "news sentiment" as a customized column. The news sentiment score captures how bullish or bearish the news flow is around a particular company. It's one of several unique columns you can use to evaluate your candidates further.
Here are a few of the bullish dividend stocks that caught our attention.
Texas Instruments Inc.
They say everything is bigger in Texas, which goes for the dividend associated with Texas Instruments Incorporated (NASDAQ: TXN). At an annualized $5.20 per share, the semiconductor company pays one of the highest dividends in technology. The stock's 3.2% forward yield is also well ahead of the current S&P 500 yield (1.5%).
Texas Instruments' 20-year dividend increase streak makes it a rare breed in a cyclical sector not known for its consistent dividend growth. The dividend has grown at a 25% annual rate since 2004, supported by strong free cash flow growth.
Last week, Texas Instruments unveiled its latest automotive semiconductors at the closely watched Consumer Electronics Show (CES). The new radar sensor chips make for more accurate advanced driver assistance systems (ADAS), while the new driver chips promote safer battery management. TXN, which appears to be making another run at $200, will look to keep the good vibes flowing when it reports fourth-quarter earnings on January 23.
General Electric Co.
Last week, GE Vernova, the gas power/renewable energy/digital arm of General Electric Co. (NYSE: GE), formed a gas turbine supply agreement with Australia's government-owned CS Energy. The deal will see GE provide 12 of its aero-derivative gas turbines to the company's power plant in Queensland to generate solar and wind power. GE Vernova also recently won an onshore wind turbine deal from Pattern Energy, which will install GE equipment at its SunZia wind farm in New Mexico.
GE shares had a power surge in 2023, advancing 95% on the backs of a restructuring plan that translated to stronger financial performances. The company beat Wall Street earnings estimates in the first three quarters of 2023 and will look to go 4-for-4 when it reports before the opening bell on January 23.
The stock's eight-cent quarterly dividend is minuscule and slashed in 2018 and 2019 as part of an effort to jumpstart growth. But with analysts forecasting 73% earnings per share (EPS) growth in 2024, there's a good chance GE's Board will approve a long-awaited dividend hike by year end.
TJX Companies Inc.
The dividend offered by The TJX Companies Inc. (NYSE: TJX) isn't big either, but, like GE, has significant room for improvement. Less than 30% of the apparel retailer's projected earnings are slated toward dividends.
Currently at $1.33 per share (annually), the dividend has been raised in the last two years. It is likely to trend higher as TJX strengthens its financial statements following a severe pandemic setback.
Wall Street has long been constructive on the owner of T.J. Maxx, HomeGoods, Marshalls and other discounted brand name stores. The bullish sentiment has carried into 2024. Since the calendar flipped, four firms have reiterated their Buy ratings on TJX even after it finished up 18% in 2023. During its last earnings call, CEO Ernie Herrman commented that the all-important holiday shopping period was off to a strong start. TJX will also look to make it four-for-four on 2023 EPS beats when it reports on February 28.
