Amidst macroeconomic uncertainty, investors are seeking reliable sources of income to bolster their portfolios in times of volatility. Wall Street analysts have identified dividend-paying stocks as a potential solution to this dilemma. According to TipRanks, a platform that ranks analysts based on their past performance, there are several attractive dividend stocks recommended by top professionals. One such stock is Chord Energy (CHRD), an oil and gas operator in the Williston Basin.
Siebert Williams Shank analyst Gabriele Sorbara recently initiated coverage of Chord Energy stock with a buy rating and a price target of $262. Sorbara highlighted CHRD’s attractive valuation and capital returns, pointing to the company’s peer-leading capital returns framework. Chord Energy aims to return more than 75% of its free cash flow to shareholders through dividends and buybacks, setting it apart from its industry peers. The analyst predicts capital returns of $778.8 million in 2024 and $1.15 billion in 2025, with capital return yields above the peer average.
Sorbara commended CHRD’s solid track record in the Williston Basin and its impressive inventory of oil locations. The analyst noted that the company’s capital efficiencies, wider spacing, longer laterals, and acquisition synergies position it as a premier player in the basin. With an optimistic outlook for key metrics like production, EBITDA, and free cash flow, driven by recent strategic moves and market conditions, Sorbara’s endorsement of Chord Energy reflects confidence in its growth potential.
Energy Transfer (ET), a master limited partnership specializing in midstream energy operations, is another dividend stock recommended by Wall Street experts. With over 125,000 miles of pipeline infrastructure, ET plays a crucial role in the energy sector. Mizuho analyst Gabriel Moreen recently raised the price target for ET to $19 and reiterated a buy rating, identifying it as the firm’s preferred midstream pick.
Moreen emphasized ET’s consistent free cash flow outlook and strength in the Permian basin. Despite some underperformance relative to peers, the analyst believes that ET could leverage its improved reputation by providing a clear capital allocation strategy. This transparency could serve as a catalyst for investors looking to capitalize on the company’s healthy free cash flow yield and discounted valuation. Moreen’s endorsement of ET underscores its potential for delivering favorable returns to shareholders.
As a dividend king, Coca-Cola (KO) has a long history of rewarding investors with consistent dividend increases. The beverage giant raised its quarterly dividend earlier this year, marking the 62nd consecutive year of dividend growth. With a dividend yield of 3.1%, KO remains an attractive option for income-oriented investors.
RBC Capital analyst Nik Modi reaffirmed a buy rating on KO stock following the company’s better-than-expected first-quarter results. Modi highlighted KO’s strong performance in the face of currency headwinds, attributing it to the company’s resilient fundamentals. The analyst anticipates continued revenue and earnings growth for Coca-Cola, particularly if the U.S. dollar weakens, given the company’s global market exposure.
Modi’s optimism regarding Coca-Cola reflects confidence in the company’s strategic initiatives and growth prospects. As one of the most recognized brands in the world, KO continues to be a staple in dividend-focused portfolios, offering a balance of income and potential for capital appreciation.
Investing in dividend stocks recommended by top analysts can be a prudent strategy for navigating market uncertainties. Companies like Chord Energy, Energy Transfer, and Coca-Cola offer income-seeking investors the opportunity to benefit from dividend distributions while potentially capitalizing on long-term growth prospects. By heeding the advice of Wall Street experts and conducting thorough research, investors can build a diversified portfolio that provides both stability and income in volatile market conditions.