Trump or Clinton Means Weaker Dollar: Buy These 4 Dividend Stocks
Despite the pollsters are giving Hillary Clinton a 70% to 80% chance of victory in less than a month, stranger things have happened. Ronald Reagan trailed Jimmy Carter by 15 points in February-March of 1980. Then Reagan came back and won in a 44 state landslide. One thing is for sure, the U.S. dollar is expected to weaken regardless of the final outcome, and for companies that thrive on a weaker greenback, 2017 could be a great year.
We screened the Merrill Lynch database for stocks that were rated Buy, that also did a significant amount of their sales and business overseas. We found four that look very attractive, and could make good sense as we head to 2017.
This iconic blue chip industrial was on a roll but has sold off 15% since July and is giving investors a nice entry point. General Electric Co. (NYSE: GE) is a highly diversified, global industrial corporation. Its businesses are organized broadly under six segments: GE Capital, Energy Infrastructure, Aviation, Healthcare, Transportation and Home & Business Solutions. Its products and services include power generation equipment, aircraft engines, locomotives, medical equipment, appliances, commercial leasing and personal finance. Wall Street analysts feel that the American giant will be a large player in the efficient energy field.
While the analysts recently lowered earnings expectations for the quarter slightly, they remain positive as expectations for orders and free cash flow already seem very low. They also note that the industrial giant has a massive $25 billion in cash, which could be put to use to drive earnings toward $2 a share by 2018.
GE shareholders are paid a 3.16% dividend. The Merrill Lynch price target for the stock is $37, and the Wall Street consensus target is $33.13. The shares closed last Friday at $29.08.
This leader in semiconductors is working hard to scale away from dependence on personal computers. Intel Corp. (NASDAQ: INTC) designs, manufactures and sells integrated digital technology platforms worldwide. The company’s platforms are used in various computing applications comprising notebooks, two-in-one systems, desktops, servers, tablets, smartphones, wireless and wired connectivity products, wearables, retail devices and manufacturing devices, as well as for retail, transportation, industrial, buildings, home use and other market segments.
The company also provides communication and connectivity offerings, such as baseband processors, radio frequency transceivers and power management integrated circuits, and tablet, phone and Internet of Things solutions, which include multimode 4G LTE modems, Bluetooth technology and GPS receivers, software solutions and interoperability tests, as well as home gateway and set-top box components.
Intel reported an inline second quarter, but data center sales came in way below expectations. However, a new partnership with Microsoft for virtual reality, and a consistent shift away for reliance on chips for personal computers, keeps the stock a compelling buy. Intel does a stunning 82.4% of its sales overseas, the lion’s share of it in Asia, where the chips that it produces are used in personal computers, tablets and other personal electronic devices.
Intel investors are paid a solid 2.73% dividend. The Merrill Lynch price target is $45, while the consensus target is lower at $40.38. The shares closed Friday at $38.10.