Every year, the premier Wall Street firms release a list of their top stock picks for the coming 12 months, and typically, they are companies that the stock analysts have incredibly high conviction in. In addition, they often have good upside to the assigned price target and are bestowed with either a Buy or Overweight rating depending on the company providing the coverage.
At 24/7 Wall St., we like to cover these top stocks and then screen the companies looking for those paying the highest dividends to investors, as this can increase the total return potential.
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.
We screened the 57 top stocks of the 2024 Year Ahead Best Ideas from J.P. Morgan, a top Wall Street firm, and found five companies that are the favorite 2024 picks that also pay stellar dividends. All are rated Overweight.
AGNC Investment
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This company has paid solid monthly dividends for years, with a massive 15.19% yield. AGNC Investment Corp. (NASDAQ: AGNC) operates as a real estate investment trust (REIT) in the United States.
The company invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by the United States government-sponsored enterprise or by the United States government agency.
The company funds its investments primarily through collateralized borrowings structured as repurchase agreements.
The company has elected to be taxed as a REIT under the Internal Revenue Code 1986. It would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders.
Baker Hughes
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This top oil field services giant pays a dependable 2.88% dividend, and JPMorgan has a $42 price target. Baker Hughes Company (NYSE: BKR) provides a portfolio of technologies and services to energy and industrial value chains worldwide.
The company operates through two segments:
- Oilfield Services & Equipment (OFSE)
- Industrial & Energy Technology (IET)
The OFSE segment designs and manufactures products and provides related services, including exploration, appraisal, development, production, rejuvenation, and decommissioning for onshore and offshore oilfield operations.
This segment also provides
- Drilling services
- Drill bits and drilling and completions fluids
- Completions
- Intervention
- Measurements
- Pressure pumping, and wireline services
- Artificial lift systems, and oilfield and industrial chemicals
- Subsea projects and services
- Flexible pipe systems, and surface pressure control systems
- Integrated healthy services and solutions
It serves oil and natural gas companies in addition to:
- United States and international independent oil and natural gas companies
- National or state-owned oil companies
- Engineering, procurement, and construction contractors
- Geothermal companies
- Oilfield service companies
The IET segment provides gas technology equipment, including drivers, driven equipment, flow control, turnkey solutions for mechanical drive, compression, and power-generation applications, and energy sectors, such as oil and gas, LNG operations, petrochemical, and carbon solutions.
This segment also provides:
- Rack-based vibration monitoring equipment and sensors
- Integrated asset performance management products
- Inspection services
- Pumps, valves, and gears
- Precision sensors and instrumentation, and condition monitoring solutions.
It serves upstream, midstream, downstream, onshore, offshore, and small and large-scale customers.
Bank of New York Mellon
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This is the oldest company in the Fortune 500, pays a 3.05% dividend, and JPMorgan has set a $61.50 price objective. The Bank of New York Mellon Corporation (NYSE: BK) provides financial products and services in the United States and internationally.
The company operates through three segments:
- Investment Services
- Investment and Wealth Management
- Others
The Investment Service segment offers:
- Custody
- Trust and depositary
- Accounting
- Exchange-traded funds services
- Middle-office solutions
- Transfer agency
- Services for private equity and real estate funds
- Foreign exchange
- Securities lending, liquidity/lending services
- Brokerage and data analytics
- Clearing
- Investment, wealth and retirement solutions
- Technology and enterprise data management
- Trading
- Corporate trust
- Depositary receipts
- Payments
- Foreign exchange
- Liquidity management
- Receivables processing and payables management
- Trade finance and processing
- Collateral management
- Tri-party services
The Investment and Wealth Management segment provides:
- Diversified investment management strategies and distribution of investment products
- Investment management
- Custody
- Wealth and estate planning
- Private banking, investment
- Information management services
The Other segment engages in leasing, corporate treasury, derivative and other trading, corporate and bank-owned life insurance, renewable energy investment, and business exit activities.
CMS Energy
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This utility stock is perfect for conservative investors, pays a strong 3.60% dividend, and has a $65 target price objective at JPMorgan. CMS Energy Corporation (NYSE: CMS) primarily operates as an energy company in Michigan.
The company operates through three segments:
- Electric Utility
- Gas Utility
- Enterprises
The Electric Utility segment is involved in generating, purchasing, transmitting, distributing, and selling electricity.
This segment generates electricity through:
- Coal
- Wind
- Gas
- Renewable energy
- Oil
- Nuclear sources
Its distribution system comprises:
- 208 miles of high-voltage distribution overhead lines
- 4 miles of high-voltage distribution underground lines
- 4,428 miles of high-voltage distribution overhead lines
- 19 miles of high-voltage distribution underground lines
- 82,474 miles of electric distribution overhead lines
- 9,395 miles of underground distribution lines
- 1,093 substations
- three battery facilities
The Gas Utility segment purchases, transmits, stores, distributes, and sells natural gas, including 2,392 miles of transmission lines; 15 gas storage fields; 28,065 miles of distribution mains; and eight compressor stations.
The enterprise segment involves independent power production and marketing, including developing and operating renewable generation.
It serves 1.9 million electric and 1.8 million gas customers, including residential, commercial, and diversified industrial customers.
Tapestry
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This top retailer has a great niche and demographic, pays a 3.05% dividend, and JPMorgan has posted at a $56 target price. Tapestry Inc. (NYSE: TPR) provides luxury accessories and branded lifestyle products in the United States, Japan, Greater China, and internationally.
The company operates in three segments:
- Coach,
- Kate Spade
- Stuart Weitzman
It offers:
- Women’s handbags and women’s accessories, such as small leather goods, which include mini and micro handbags
- Money pieces
- Wristlets
- Pouches, and cosmetic cases
- Novelty accessories, including address books, time management and travel accessories, sketchbooks, and portfolios; and belts, key rings, and charms
The company also provides men’s products, which include:
- Bag collections, such as business cases, computer bags, messenger-style bags, backpacks, and totes;
- Small leather goods, including wallets, card cases, travel organizers, and belts
- Footwear
- Watches, fragrances, sunglasses, novelty accessories, and ready-to-wear items
In addition, it offers other products, including:
- women’s footwear and fragrances;
- eyewear and sunglasses; and
- jewelry, such as bracelets, necklaces, rings, and earrings, watches, and other
- women’s seasonal lifestyle apparel collections, including outerwear, ready-to-wear and cold weather accessories, such as gloves, scarves, and hats.
The company also provides kids’ items, housewares, and home accessories, such as fashion bedding and tableware, stationery, and gifts.
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