Was Wednesday the big wash-out that experienced traders are looking for? Was there enough panic and capitulation? The jury is still out. One thing is for sure, as weak holders flee the stock market and print massive losses, some of the best stocks to buy when things get dicey are not only standing their ground, they could be poised for a torrent of new money as investors bolt momentum stocks.
Smart investors may be wondering why, say, a telecom stock is going down just because oil has traded lower? Once the avalanche in selling starts, nothing is safe and that is exacerbated by panicked retail accounts that would rather take huge losses than risk losing everything.
We screened the Merrill Lynch research data base for stocks that should not only hold up well in the face of continued selling but have solid upside potential when things turn higher. They also pay solid dividends and are rated Buy.
This company posted very solid third-quarter numbers, and was just added to the Merrill Lynch prestigious US 1 stock list. AT&T Inc. (NYSE: T) is the world’s largest provider of pay TV, with TV customers in the United States and 11 Latin American countries. In the United States, the AT&T wireless network has the nation’s self-described strongest 4G LTE signal and most reliable 4G LTE.
The company also helps businesses worldwide serve their customers better with mobility and highly secure cloud solutions. Trading at a very cheap 11.9 times estimated 2016 earnings, the company continues to expand its user base, and strong product introductions from smartphone vendors have not only driven traffic, but increased device financing plans.
AT&T reiterated 2015 guidance for double-digit revenue growth and continued consolidated margin expansion. Management expects capital spending to increase sequentially and they also estimate that free cash flow could be better than $4.5 billion. Third-quarter wireless subscriber additions came in higher than many Wall Street estimates, and DirecTV saw positive video additions where many expected losses.
The company announced recently it is working with Salesforce.com to connect Internet of Things data from AT&T’s solutions into Salesforce’s Customer Success Platform. By connecting AT&T M2X into the Salesforce Service Cloud, companies can automatically create and route service requests, cases or tickets through pre-built workflows.
AT&T investors receive a huge 5.66% dividend. The Merrill Lynch price target for the stock is $40, and the Thomson/First Call consensus estimate is $37.16. Shares closed Wednesday at $33.90.
This top triple-net real estate investment trust (REIT) just raised its dividend almost 6%. EPR Properties (NYSE: EPR) invests in properties in select market segments that require unique industry knowledge, while offering the potential for stable and attractive returns. The company’s total investments exceed $4.5 billion and the primary investment segments are Entertainment, Recreation and Education.
EPR adheres to rigorous underwriting and investing criteria centered on key industry and property level cash flow standards. Corporate executives believe that the focused niche approach provides a competitive advantage and the potential for higher growth and better yields.
Last week the EPR board of trustees declared its monthly cash dividend to common shareholders. The dividend of $0.32 per common share is payable February 15, 2016 to shareholders of record on January 29, 2016. This dividend represents an annualized dividend of $3.84 per common share, an increase of 5.8% over prior year and the company’s sixth consecutive year with an annual dividend increase.
Shareholders receive an outstanding 7.04% dividend. Merrill Lynch has a $65 price target, and the consensus target is $61.71. Shares closed Wednesday at $54.51.