Investing

Top Wall Street Strategist Out With 5 Rock-Solid Dividend Portfolio Stocks

Honeywell International

This top industrial still could be poised for an incredible 2020 if global growth picks up. Honeywell International Inc. (NYSE: HON) is a New Jersey-based, diversified, global technology and manufacturing company. Its operations are organized under four business groups: Aerospace, Home & Building Technologies, Safety & Productivity Solutions, and Performance Materials & Technologies.

The company is also a premier supplier of avionics, power and control systems for the aerospace industry. Last year, the analysts attended the company’s Honeywell Building Technologies Investor Showcase at the segment’s Atlanta headquarters, and they noted this in a recent report:

HBT has improved its revenue and margin trajectory following the October 2018 spin-out of its residential business. This is being driven by management & cultural change (four of five segment leaders have been with the company for almost 2 years; President Vimal Kapur is new to HBT, coming from Honeywell’s Process Solutions segment last year). New leaders started reinvigorating products (rising vitality indexes across sub-segments).

Investors receive a 2.48% dividend. The $175 Jefferies price objective compares to the $156.50 consensus figure. Honeywell International stock ended last week at $145.37.

Medtronic

This medical technology giant is a solid pick for investors looking for a safer position in the health care sector. Medtronic PLC (NYSE: MDT) develops, manufactures, distributes and sells device-based medical therapies to hospitals, physicians, clinicians and patients worldwide. It operates in four segments: Cardiac and Vascular Group, Minimally Invasive Therapies Group, Restorative Therapies Group and Diabetes Group.

The company announced last week that Blackstone’s life sciences division will invest $337 million into the research and development of its diabetes device technologies. Under the terms of the agreement, Medtronic will receive funding for four diabetes programs over the next several years. Medtronic’s engineering, clinical and regulatory teams will conduct the development work for the programs.

Blackstone’s investment is sought to pull forward specific programs for its diabetes pump and continuous glucose monitoring pipeline devices that aim to address unmet patient needs. If the programs are successful, Medtronic will pay royalties that are expected to be in the low- to mid-single-digit range as a percentage of sales.

Medtronic stockholders receive a 2.47% dividend. The Jefferies price target is $120. The consensus target is $110.17, and shares closed at $93.91 on Friday.

Procter & Gamble

The company offers a very dependable dividend, which was raised to $0.79 from $0.75 this spring. Procter & Gamble Co. (NYSE: PG) is one of the world’s largest consumer products companies, and it operates in five segments: Beauty, Grooming, Health Care, Fabric & Home Care, and Baby & Family Care. Its many brands include Pampers, Tide, Bounty, Charmin, Gillette, Oral B, Crest, Olay, Pantene, Head & Shoulders, Ariel, Gain, Always, Tampax, Downy and Dawn. Some of these are among the most valuable brands in the world.

The company sells its products through mass merchandisers, e-commerce, grocery stores, membership club stores, drug stores, department stores, distributors, wholesalers, baby stores, specialty beauty stores, high-frequency stores and pharmacies. The company has been very 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 dividend increase translates to a 2.66% yield for shareholders. Jefferies has set a $128 price objective. The consensus target price is $129.43, and Procter & Gamble stock closed most recently at $118.92 per share.

These five rock-solid dividend picks from the Jefferies analysts are outstanding total return plays. They have solid appreciation potential, and it is a very good bet the dividends stay intact and continue to be raised, often annually.