5 Blue-Chip Dividend Stock Buys for Q2

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Entergy

This higher yielding utility makes the buy list at 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. The company 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 4.6% dividend. Note that the $82 Merrill Lynch price target is less than the posted consensus target of $83.39. The stock traded early Wednesday at $77.20.

Exxon Mobil

This company remains a top Wall Street energy pick and is down over 15% in the past month, and it remains the preferred pick at Merrill Lynch. Exxon Mobil Corp. (NYSE: XOM) is the world’s largest international integrated oil and gas company. It explores for and produces crude oil and natural gas in the United States, Canada, South America, Europe, Africa and elsewhere.

The company also manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics, and specialty products, and it transports and sells crude oil, natural gas and petroleum products.

For 75 years in a row, Exxon has raised its dividend on a split-adjusted basis. Thanks to the company’s vertically integrated model in the oil and gas business, its profitability doesn’t suffer through commodity price swings like a company that’s a pure play in one segment of the value chain.

Exxon shareholders are paid a nifty 4.13% dividend. Merrill Lynch has set its price objective at $102. The consensus target price is much lower at $87.19. The stock traded at $74.6o Wednesday morning.

Verizon Communications

This top telecommunications company is offering investors an outstanding entry point. Verizon Communications Inc. (NYSE: VZ) is a global leader in delivering the digital world. Verizon Wireless operates America’s self-described most reliable wireless network, with 109.5 million retail connections nationwide.

Verizon also provides converged communications, information and entertainment services over America’s most advanced fiber-optic network, and it delivers integrated business solutions to customers worldwide.

Verizon posted solid fourth-quarter results, and it remains a safe and solid growth and income play. The Merrill Lynch analysts said this when they released results.

Verizon reported a solid top line beat due to the strength of the wireless business. The company missed on 4Q EBITDA/EPS due to higher expenses in the Oath business related to fourth quarter seasonal effects. We reiterate our Buy and raise the price target.

Verizon investors are paid an outstanding 4.82% dividend. The Merrill Lynch price target is $58. The consensus target was last seen at $55.88, and the stock traded early Wednesday at $48.70.

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These five stocks could be great total return stories in the second quarter and for the rest of 2018, and they also offer investors a degree of safety in what has become a very volatile stock market. All make sense for more conservative growth and income accounts, and all make great buys as they have been put on sale by nervous investors.