Editor
High-yield dividend stocks don’t usually drop in price, so when they do get close to their 52-week lows, many people looking for income take notice. Some deals are just too good to pass up, even when the market is a bit shaky.
Take Lowe’s, Procter & Gamble, and Chevron, for example. They’re well-known brands, and right now, their dividend yields are much higher than the average for the S&P 500. This gives investors a bit of comfort while waiting for things to improve.
A Short-Term Slowdown for Lowe’s, But Solid Foundations
Lowe’s Companies has had a rough year, with its stock price dropping more than 9% since January. As it gets closer to a 52-week low of $206.39, many are starting to question if this marks the beginning of tougher times for home improvement stores.
Emily Chen, a retail analyst at Arbor Research Partners, points out that while people are cutting back on large renovation projects, homes still need maintenance and repairs that can’t be ignored forever.
Looking ahead, Lowe’s is predicting flat to slightly positive sales growth for the fiscal year ending in January. This isn’t exactly exciting news, but it’s not catastrophic either. For those interested in steady income, Lowe’s has a low payout ratio of 38%, which keeps its 2.2% dividend yield looking stable.
Plus, with over 50 years of consistent dividend increases, it’s a stock that might appeal to investors who are willing to ride out some short-term ups and downs.
Procter & Gamble’s Dependable Payout
Procter & Gamble (NYSE: PG) is often considered one of the most reliable high-yield dividend stocks. With a yield of 2.6%, this well-established consumer goods company has been paying out dividends consistently for nearly 70 years.
Currently, its stock is just a few dollars above its 52-week low of $156.58. P&G has seen a bit of a dip, down about 5% this year, but that’s more about the general fatigue in the defensive sector rather than a serious issue for the company. Although net sales dropped by 2% compared to last year’s quarter, organic sales, which exclude currency changes and special circumstances, actually grew by 1%.
James Patel, a consumer goods expert at Northpoint Advisors, highlights that no matter how the economy shifts, people will still need essentials like laundry detergent and diapers. While there is always a risk that consumers might switch to cheaper generic brands, P&G’s products tend to stick with shoppers. With its strong dividend history and well-known brands like Tide and Pampers, it’s a reliable choice for investors looking for something to buy and hold.
Chevron Offers the Biggest Yield—And Some Volatility
Chevron, which trades under the symbol CVX, offers the highest dividend yield among its peers at a notable 4.8%. However, investing in Chevron comes with some risks since oil prices can be quite unstable, and this volatility often impacts profits. Just last quarter, Chevron saw its net income drop by 37% to $3.5 billion mainly due to lower crude prices. Still, there’s some good news: the company has increased its dividend for 38 consecutive years, with a payout ratio sitting at around 75%, which is still manageable.
Carla Mendes, an energy equity strategist at Beacon Capital, points out the irony in energy investing — while earnings can fluctuate a lot, the dividends tend to be reliable. If oil prices rise again, which they tend to do, Chevron could quickly see its profits bounce back. Right now, Chevron’s shares are hovering near their 52-week low of $132.04, providing a potential chance for investors looking for a solid yield.
Bottom Line: A Chance to Lock in Bigger Income
Even though these high-yield dividend stocks come with some risks, their recent drops in price make them a good buying opportunity for investors looking for income. With the S&P 500’s average yield sitting at only about 1.2%, getting returns between 2% and nearly 5% from reputable companies seems pretty appealing. If you’re okay with a little short-term volatility, the long-term benefits could really pay off.
