The fast-food giant does a ton of business overseas but still remains a solid pick for investors seeking dividends and a degree of safety. McDonald’s Corp. (NYSE: MCD) is the world’s leading global food-service retailer with over 37,000 locations serving approximately 69 million customers in over 100 countries each day. More than 80% of McDonald’s restaurants worldwide are owned and operated by independent local business men and women.
McDonald’s shares have been positive recently as menu price increases and global growth fueled a strong third-quarter earnings report. McDonald’s beat earnings on the top and bottom line, and the company posted its 13th consecutive quarter of positive same-store sales growth.
McDonald’s shareholders receive a 2.72% dividend. Merrill Lynch has price target of $200. The consensus price objective is $195.44, and shares were trading at $170.00.
Procter & Gamble
This stock also offers a very solid dividend and safety. Procter & Gamble Co. (NYSE: PG) is another solid consumer staples stock for conservative investors to consider. It sells lots of very well-known household items that are essential for everyday life. Brands include Pampers, Tide, Bounty, Charmin, Gillette, Oral B, Crest, Olay, Pantene, Head & Shoulders, Ariel, Gain, Always, Tampax, Downy and Dawn.
The company actually is innovative in its product development process and uses that to help ensure future growth and cash flow. This should provide investors years of steady growth and dividends. The Merrill Lynch team recently turned positive on the stock and noted this:
Merrill Lynch hosted investor meetings at the company’s headquarters with CFO Moeller which corroborate our analysis. Our meetings/analysis in the note lead us to conclude recent momentum is sustainable; we see Procter & Gamble beating current fiscal second quarter consensus. Risks remain, but manageable given momentum and defensive qualities which we see as attractive in a volatile equity market.
Shareholders receive a 3.28% dividend. Merrill Lynch has a $108 price objective. The consensus target is $90.88, and the stock traded at $87.95 on Wednesday.
This top pharmaceutical stock made a gigantic splash last year with a $5.5 billion purchase of Anacor Pharmaceuticals. Pfizer Inc. (NYSE: PFE) is a global biopharmaceutical company with a diversified portfolio of products and pipeline candidates, and it is one of the largest pharmaceutical companies in the world as measured by market capitalization and revenue. It also is a component of the Dow Jones industrial average.
The company’s commercial operations are bifurcated into two business segments: Innovative Health, which focuses on the development and commercialization of medicines and vaccines, as well as consumer health care products, in various therapeutic areas, and Essential Health, which offers branded generic products, biosimilars, anti-infectives and other products without marketing patent protection.
Investors receive a 3.55% dividend. Merrill Lynch price objective of $47 compares with the target price of $45.32. The shares traded at $40.65.
These six safer stocks all carry Merrill Lynch’s best volatility risk rating and pay dependable dividends. They offer reasonable entry points and are the type of companies you can sleep well at night owning. While the bottom may not be totally in, starting to nibble at these great stocks does make sense now.