4 Safe Dividend Stocks to Buy Now If Continued Market Volatility Making You Queasy

Investing

Published: February 8, 2016 9:50 am

Last Updated: January 13, 2020 1:29 pm

It’s one thing to have scary up-and-down markets, but it’s quite another when there are very few alternatives. Income investors, and most investors in general, can’t “go to cash” as so many cavalier financial talking heads often suggest. Commissions are prohibitive, and the yields on cash-type investments like certificates of deposit (CDs) are abysmal. The good news is there actually are a few safe places investors can head to now for safety and income.

We screened the Merrill Lynch research data base for telecommunication, utilities and consumer staples/discretionary stocks that pay solid dividends and are safe places to put money for the time being. We found four rated Buy that makes good sense for nervous investors now.

Entergy

This higher yielding company was recently upgraded by Merrill Lynch. Entergy Corp. (NYSE: ETR) is an integrated energy company engaged primarily in electric power production and retail distribution operations. It owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, including nearly 10,000 megawatts of nuclear power, making it one of the nation’s leading nuclear generators. Entergy delivers electricity to 2.8 million utility customers in Arkansas, Louisiana, Mississippi and Texas. Entergy has annual revenues of more than $12 billion and approximately 13,000 employees.

Many analysts like the position of the company’s plants, as they supply some of the petrochemical industry along the Gulf Coast. Petrochemical plants and liquefied natural gas export facilities are springing up all across the central Gulf coast. For the petrochemical industry, the boom is driven by demand, not supply, and so the current lower gas prices actually help this growth trend, which has been a solid revenue silo for Entergy.

Entergy investors are paid an outstanding 5% dividend. The Merrill Lynch price target for the stock is $72, and the Thomson/First Call consensus target is $72.06. The stock closed Friday at $68.09.