After years of a low interest rate environment that had started to trend higher until recently, many investors have turned to equities not only for the growth potential but also for solid and dependable dividends which help to provide an income stream. What this equates to is total return, which is one of the most powerful investment strategies going.
We always like to remind our readers about the impact total return has on portfolios because it is one of the best ways to help improve the chances for overall investing success. Again, total return is the combined increase in a stock’s value plus dividends. For instance, if you buy a stock at $20 that pays a 3% dividend, and it goes up to $22 in a year, your total return is 13%. 10% for the increase in stock price and 3% for the dividends paid.
Five top large-cap companies that are Wall Street favorites are expected to raise their dividends this week, so we screened our 24/7 Wall St. research universe and found that all are rated Buy at some of the top firms on Wall Street. While it’s always possible that not all of the five do indeed raise their dividends, top analysts expect them to, and generally the data is based on past increases in the firm’s dividend payouts. It’s important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
This company serves thousands of businesses both small and large across the U.S. Cintas Corporation (NASDAQ: CTAS) provides corporate identity uniforms and related business services primarily in the United States, Canada, and Latin America.
It operates through Uniform Rental and Facility Services, First Aid and Safety Services, and All Other segments. The company rents and services uniforms and other garments, including flame resistant clothing, mats, mops and shop towels, and other ancillary items; and provides restroom cleaning services and supplies, as well as sells uniforms.
Cintas Corporation also offers first aid and safety services, and fire protection products and services. The company provides its products and services through its distribution network and local delivery routes, or local representatives to small service and manufacturing companies, as well as major corporations.
Investors are currently paid a dividend of 0.96%. It is expected the company will raise the dividend over 10% to $1.07 per share from $0.95. Deutsche Bank has a Buy rating and a $465 target price. The Wall Street consensus target is posted at $436.50. Friday’s closing trade was posted at $396.73.
This company is a solid way for more conservative accounts to play the energy sector. Marathon Petroleum Corporation (NYSE: MRO) operates as an independent exploration and production company in the United States and internationally.
The company engages in the exploration, production, and marketing of crude oil and condensate, natural gas liquids, and natural gas; and the production and marketing of products manufactured from natural gas, such as liquefied natural gas and methanol. It also owns and operates 32 central gathering and treating facilities; and the Sugarloaf gathering system, a 42-mile natural gas pipeline through Karnes and Atascosa counties in Texas.
Wall Street analysts are very positive on the prospects for the company’s second quarter earnings, which they are expected to report on August 3.
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Investors are currently receiving a 1.47% dividend. The company is expected to lift the dividend to $0.09 from $0.08. Piper Sandler has an Overweight rating on the shares and recently boosted the target price on them to $41 from $38. That compares with the lower Wall Street consensus target of $33.16 and Friday’s closing print of $21.75.
This is an off-the-radar small cap financial stock that offers some solid upside potential. OFG Bancorp (NYSE: OFG) is a financial holding company, providing a range of banking and financial services. It operates through three segments: banking, wealth management, and treasury. The company offers checking and savings accounts, as well as time deposit products; commercial, consumer, auto, and mortgage lending services; financial planning and insurance services; and corporate and individual trust, and retirement services.
OFG Bancorp also provides securities brokerage and investment advisory services, including various investment alternatives, such as tax-advantaged fixed income securities, mutual funds, stocks, and bonds to retail and institutional clients; and separately managed accounts and mutual fund asset allocation programs. In addition, the company engages in the insurance agency and reinsurance businesses; administration and servicing of retirement plans; various treasury-related functions with an investment portfolio consisting of mortgage-backed securities, obligations of U.S. government sponsored agencies, and U.S. Treasury securities and money market instruments; and management and participation in public offerings and private placements of debt and equity securities.
It also offers money management and investment banking services; and engages in the asset/liability management activities, such as purchases and sales of investment securities, interest rate risk management, derivatives, and borrowings. The company operates through a network of 50 branches in Puerto Rico and two branches in United States Virgin Islands.
Shareholders are paid a 2.27% dividend. The company is expected to lift the dividend to $0.17 from $0.15. Piper Sandler has an Overweight rating and a $33 target. The consensus across Wall Street is $35. Friday’s last trade was filled at $26.49.
This large cap bank is perhaps the best solid value play for 2022 and is another big money center that can benefit from higher net interest income. Wells Fargo & Company (NYSE: WFC) a diversified financial services company, provides banking, investment, mortgage, and consumer and commercial finance products and services in the United States and internationally. It operates through four segments: consumer banking and lending; commercial banking; corporate and investment banking; and wealth and investment management.
The consumer banking and lending segment offers diversified financial products and services for consumers and small businesses. Its financial products and services include checking and savings accounts, and credit and debit cards, as well as home, auto, personal, and small business lending services.
The commercial banking segment provides financial solutions to private, family owned, and certain public companies. Its products and services include banking and credit products across various industry sectors and municipalities, secured lending and lease products, and treasury management services.
The corporate and investment banking segment offers a suite of capital markets, banking, and financial products and services to corporate, commercial real estate, government, and institutional clients. Its products and services comprise corporate banking, investment banking, treasury management, commercial real estate lending and servicing, equity, and fixed income solutions, as well as sales, trading, and research capabilities services.
The wealth and investment management segment provides personalized wealth management, brokerage, financial planning, lending, private banking, and trust and fiduciary products and services to affluent, high-net worth, and ultra-high-net worth clients.
Wells Fargo shareholders are paid a 2.32% dividend. The bank is expected to lift the dividend to $0.30 from $0.25. Morgan Stanley has an Overweight rating with a $62 price target, and the consensus price target is much lower at $53.04. The shares were last traded Friday at $43.17.
This food company has huge upside potential, and with the NFL season right around the corner, you can bet the orders will skyrocket. Wingstop, Inc. (NASDAQ: WING) operates and franchises more than 1,500 locations worldwide.
The company offers classic wings, boneless wings and tenders, and a choice of 11 flavors. Wingstop’s menu also features seasoned fries and freshly made ranch and blue cheese dips.
Top analysts across Wall Street believe Wingstop is still in the early innings of a long-term growth story as the company has a strong, digitally focused foundation to support unit expansion. As of December 25, 2021, Wingstop had 1,695 franchised restaurants and 36 company-owned restaurants in 44 states and seven countries worldwide, with some of the best unit-level economics in the industry lending support to franchisee demand.
Shareholders are currently paid a 0.65% dividend. It is expected that the company will raise the dividend to $0.20 per share from $0.17 per share. Truist Financial has a Buy rating and a $130 price target for the company that compares with $109.37 consensus and Friday’s closing print of $169.84.
Five top companies that all are rated Buy across Wall Street are expected to lift the dividends they pay to shareholders. Not only is increasing dividends and returning capital to investors important, it also shows that the company is doing well and has the earnings and cash-flow strength to increase the payouts.
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