On the Agenda
- United Parcel Service UPS : Despite an 11% revenue dip, UPS’s relentless adaptation, a focus on booming sectors like healthcare logistics, and a generous 4.2% dividend yield signal it’s a package of prosperity.
- Morgan Stanley MS : Though down 12%, Morgan Stanley — armed with its 4.34% dividend yield and its diversified focus beyond Wall Street deals — is poised for a 26.5% surge as the banking sentiment and M&A activities rejuvenate.
- American Tower AMT : Unfazed by real estate’s whims, American Tower’s $3.1 billion revenue leap and robust 3.9% dividend yield showcase its steadfast ascent in the digital connectivity epoch.
Dividend stocks are financial stalwarts, valued for long-term superiority and consistent cash flows, presenting investors not just with passive income but also a potential growth runway. Dividend giants are the bedrock of a long-term investor’s portfolio. The article highlights three dividend stocks, each offering a yield of at least 3.5% and a history of increasing payouts for over a decade.
United Parcel Service (UPS)
As the pandemic waved a magic wand over ecommerce, United Parcel Service hitched a ride, with its financials soaring to new heights. Though the fairy dust settled down post-pandemic, UPS’s growth narrative remains incredible, with its second quarter witnessing an 11% dip in revenue year-over-year. Still, with projections of 5.5% top-line growth and a bullish outlook on EPS next year, it’s clear: UPS isn’t about to hit the brakes anytime soon.
Though operating profits wavered, UPS showed its true colors, adapting swiftly with cost adjustments and an unparalleled, sprawling network that’s become synonymous with reliability. Moreover, it’s focusing on targeting burgeoning sectors for business expansion, including healthcare logistics, and aiming for a cool $10 billion in revenue this year alone.
United Parcel Service today offers a healthy dividend yield of 4.2% and $4 billion in returns to shareholders.
Morgan Stanley (MS)
Morgan Stanley is down 12% year-to-date and has been treading water since several regional U.S. lenders imploded this spring. However, its stock is expected to rise sharply once sentiment surrounding the banking sector improves. Tipranks’s analysts forecast a 26.5% upside from current price levels to $94.75.
Morgan Stanley is different from many other investment banks on Wall Street in that it is not solely dependent on IPOs and M&A for its profits. CEO James Gorman (currently in the midst of an orderly transition to a successor) had the foresight to focus most of the bank’s resources on wealth management even before the coronavirus pandemic hit. The 2022 bear market brought Wall Street deals to a near standstill. This diversification helped Morgan Stanley weather economic cycles and achieve steady earnings relative to its peers.
One reason to believe that will continue is that the company may be setting up to gain strength in 2024. The investment banking firm is seeing emerging signs of strong M&A activity, and if it’s in a slowdown right now, investors should expect Morgan Stanley to do well.
American Tower (AMT)
American Tower, a real-estate-investment-trust (REIT), is a digital powerhouse, its global network of 225,000-plus cell towers forms the nerve center of our hyper-connected world, an indispensable asset to, well, pretty much everybody. The shortcomings in the real estate sphere aren’t likely to dictate this giant’s fate; it’s the demand for connectivity that keeps its roots deep and branches expanding.
The company’s rental revenues soared from $7.3 billion in 2018 to a whopping $10.4 billion in 2022. Despite the unpredictable nature of net income, marred by asset write-downs, the core story remains the same. American Tower’s forward dividend yield has blossomed to 3.9%, which points to not only a dividend contender but a champion, with average-funds-from-operations growth of 8.6% over the past three years.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Equities.com Guidelines.
