At 24/7 Wall St., we know how important dividend size, stability and growth are to growth and income investors that need a dependable stream of income. We often have written about the opportunities that the Dividend Aristocrats offer for long-term investors. These are the companies that meet the guidelines for inclusion and have raised their dividends every year for 25 consecutive years. This year, 66 stocks made the cut and remain top picks across Wall Street.
For those seeking even greater dividend dependability, investors may be drawn to the Dividend Kings. These 44 S&P 500 companies have raised the dividends they pay to shareholders a stunning 50 consecutive years in a row. With the market seemingly poised to head much lower, it may be time for investors to look for momentum or high beta stocks lurking in their portfolios, especially if they are still profitable or flat, and move the capital invested in them to one or more of the safest Dividend Kings.
We found five that fit the bill, and at least four of them are rated Buy at major Wall Street firms. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
AbbVie
This is a top pharmaceutical stock pick across Wall Street. AbbVie Inc. (NYSE: ABBV) is a global, research-based biopharmaceutical company formed in 2013 following separation from Abbott Laboratories. The company develops and markets drugs in areas such as immunology, virology, renal disease, dyslipidemia and neuroscience.
One of the biggest concerns with AbbVie is what might happen eventually with anti-inflammatory therapy Humira, which has some of the largest sales for a drug ever recorded. The company was concerned, so in June of 2019 it announced that it has agreed to pay $63 billion for rival drugmaker Allergan, the latest merger in an industry in which some of the biggest companies have been willing to pay a high price to resolve questions about their future growth. The purchase officially closed in May of last year.
AbbVie may be nearing the limits of how far it can boost Humira’s price as cheaper competitors come to market, a problem Allergan is already grappling with as more alternatives to Botox emerge.
Shareholders receive a 3.74% dividend. Wells Fargo has a Wall Street high target price of $200 on AbbVie stock. The consensus target is $163.25, and the stock closed trading on Tuesday at $152.09.
24/7 Wall St.Federal Realty Investment Trust
While real estate has come back strongly, demand is still growing and hard assets are good in inflationary times. Federal Realty Investment Trust (NYSE: FRT) is a recognized leader in the ownership, operation and redevelopment of high-quality retail-based properties located primarily in major coastal markets from Boston to Washington, as well as San Francisco and Los Angeles.
Founded in 1962, Federal Realty’s mission is to deliver long-term, sustainable growth through investing in densely populated, affluent communities where retail demand exceeds supply. Its expertise includes creating urban, mixed-use neighborhoods like Santana Row in San Jose, California, Pike & Rose in North Bethesda, Maryland, and Assembly Row in Somerville, Massachusetts.
Federal Realty’s 105 properties include approximately 3,000 tenants in 24 million square feet and over 2,600 residential units. Federal Realty has increased its quarterly dividends to its shareholders for 51 consecutive years, the longest record in the real estate investment trust industry.
Unitholders receive a 3.84% distribution. Deutsche Bank’s price target is $143, and the consensus target is $135.63. Federal Realty Investment Trust stock closed on Tuesday at $109.58.
Kimberly-Clark
This consumer staples leader is another safe bet for nervous investors. Kimberly-Clark Corp. (NYSE: KMB) manufactures and markets personal care and consumer tissue products worldwide. It operates through the following three segments.
The Personal Care segment offers disposable diapers, swim pants, training and youth pants, baby wipes, feminine and incontinence care products, and other related products under the Huggies, Pull-Ups, Little Swimmers, GoodNites, DryNites, Sweety, Kotex, U by Kotex, Intimus, Depend, Plenitud, Softex, Poise and other brands.
The Consumer Tissue segment provides facial and bathroom tissues, paper towels, napkins and related products under the Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex, Neve and other brands.
The K-C Professional segment offers wipers, tissues, towels, apparel, soaps and sanitizers under the Kleenex, Scott, WypAll, Kimtech and KleenGuard brands.
The company sells its household use products directly to supermarkets, mass merchandisers, drugstores, warehouse clubs, variety and department stores, and other retail outlets, as well as through other distributors and e-commerce. It sells away-from-home use products directly to manufacturing, lodging, office building, food service and public facilities, as well as through distributors and e-commerce.
Shareholders receive a 3.34% dividend. Jefferies has set a $146 target price. The consensus target on Kimberly-Clark stock is $132.53, but shares closed at $138.95 on Tuesday.
Leggett & Platt
While somewhat off the radar, this stock has almost been cut in half over the past year and offers massive upside potential. Leggett & Platt Inc. (NYSE: LEG) designs, manufactures and markets engineered components and products worldwide.
The company offers steel rods, drawn wires, foam chemicals and additives, innersprings, specialty foams, private label finished mattresses, mattress foundations, wire forms for mattress foundations, adjustable beds, industrial sewing and quilting machines, and mattress packaging and glue drying equipment, as well as machines to produce innersprings for industrial users of steel rods and wires, manufacturers of finished bedding, big box and e-commerce retailers, bedding brands and mattress retailers, department stores and home improvement centers.
Leggett & Platt also provides mechanical and pneumatic lumbar support and massage systems for automotive seating; seat suspension systems, motors and actuators and cables; titanium, nickel and stainless-steel tubing, formed tubes, tube assemblies and flexible joint components for fluid conveyance systems; and engineered hydraulic cylinders to automobile original equipment manufacturers (OEMs) and Tier 1 suppliers, aerospace OEMs and suppliers, and mobile equipment OEMs.
Leggett & Platt stock investors receive a 4.65% dividend. The $52 Goldman Sachs target price compares with the $46.75 consensus target and Tuesday’s close at $36.16 a share.
Universal
While this company’s products may not be for everyone, they have strong demand and have been in business for almost 150 years. Universal Corp. (NYSE: UVV) processes and supplies leaf tobacco and plant-based ingredients worldwide. It engages in procuring, financing, processing, packing, storing, and shipping leaf tobacco for sale to manufacturers of consumer tobacco products.
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