4 Top Dividend Stocks To Watch In 2022
A dividend stock is a share of stock in a company that pays out regular dividends, or distributions, to its shareholders. The dividend is a portion of the company’s earnings that is paid out to shareholders normally on a quarterly basis. As a result, dividend stocks are one way to generate income from your stock market investments. In addition, they can provide you with a source of cash flow that can be used to reinvest in other stocks or to cover living expenses.
Many investors prefer dividend stocks because they offer a stable source of income and can help to diversify your portfolio. When selecting dividend stocks, it is important to consider the company’s financial stability and dividend history. Though dividend stocks can be an important part of your investment portfolio, they should not be the only type of stock that you own. Diversification is key to minimizing risk and maximizing returns. With this in mind, here are four top dividend-paying stocks to watch in the second half of 2022.
Dividend Stocks To Invest [Or Avoid] In 2022
- Rio Tinto Plc (NYSE: RIO)
- BHP Group Limited (NYSE: BHP)
- Devon Energy Corporation (NYSE: DVN)
- Sociedad Quimica y Minera S.A. (NYSE: SQM)
Rio Tinto (RIO Stock)
Starting us off, Rio Tinto (RIO) is one of the world’s largest mining companies, with a portfolio that includes iron ore, aluminum, copper, diamonds, and coal. For a sense of scale, Rio Tinto has operations in more than 40 countries around the world, and it plans to continue its expansion in the coming years. Aside from that, RIO has a current annual dividend yield of 12.36%. Just this week, the company announced it has entered into a definitive agreement to acquire full ownership of Turquoise Hill.
In detail, the transaction entails an all-cash offer of C$43 per share. This represents a premium of 67% to Turquoise Hill’s closing price of C$25.68 per share on 11 March 2022. Rio Tinto Chief Executive Jakob Stausholm commented, “This Transaction will simplify governance, improve efficiency and create greater certainty of funding for the long-term success of the Oyu Tolgoi project.” With that, shares of RIO stock are still down over 17% so far in 2022. This could present an opportunity to invest in RIO stock at a potential discount. Do you think there’s room for Rio Tinto stock in your dividend portfolio?
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BHP Group Limited (BHP Stock)
Next, BHP Group Limited (BHP) is a diversified natural resources company. It is engaged in the exploration, development, production, and marketing of mineral, energy, and metal products. As it stands today, BHP shareholders enjoy an annual dividend yield of 12.90%. Furthermore, in August the company reported its full-year 2022 financial results.
In detail, the company reported a 34% increase in profit from operations in the year ending June 2022. This was largely due to the rising commodity prices. Additionally, profit from operations advanced to $34.1 billion from $25.5 billion on a year-over-year basis. What’s more, revenues for fiscal 2022 totaled $65 billion.
BHP Group Chief Executive Officer, Mike Henry commented in his letter to shareholders, “BHP delivered strong operational performance and disciplined cost control to realise record underlying earnings of US$40.6 billion and record free cash flow of US$24.3 billion. We have reduced debt and announced a final dividend of US$1.75 per share, bringing total cash dividends announced for the full year to a record US$3.25 per share.” On Thursday, shares of BHP stock closed up over 2% at $50.39 per share. With this in mind, do you think BHP is a good dividend paying stock to buy and hold long term?
Devon Energy Corporation (DVN Stock)
Moving along, Devon Energy Corporation (DVN) is an American oil and gas exploration and production company. In brief, Devon Energy is one of the largest independent oil and gas producers in the United States. Additionally, the company’s operations are focused on unconventional oil and gas resources in North America. Additionally, Devon Energy has an annual dividend yield of 6.76%.
In August, Devon Energy announced better-than-expected Q2 2022 fiscal results. Diving in, the company reported earnings of $2.59 per share, on revenue of $5.6 billion. Versus wall street’s consensus earnings estimates of $2.38 per share, with revenue of $4.6 billion. Moreover, Devon Energy reported a 132% jump in revenue during the same period, in 2021. Following that, the company announced it generated $2.1 billion of free cash flow in the second quarter. This represents the highest amount of quarterly free cash flow in the history of the company.
Aside from that, share of Devon Energy stock have outperformed the overall stock market as shares are up over 51% year-to-date. As of Thursday’s closing bell, DVN stock is trading at $68.91 per share. Considering this, will you be watching DVN stock this week?
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Sociedad Quimica y Minera S.A. (SQM Stock)
Last but not least, Sociedad Quimica y Minera S.A. (SQM) is a Chilean chemical company with a long history of producing potassium nitrate, iodine, and lithium. The company has also been involved in the mining, extraction, and production of other minerals such as thorium and sodium sulfate. In recent years, SQM has become a major player in the global market for lithium, supplying cathode materials for electric vehicles and batteries. Today, SQM has an annual dividend yield of 4.08% for shareholders. Just last month, the company announced its second quarter 2022 financial results.
Getting straight to it, SQM reported second quarter earnings of $3.01 per share on revenue of $2.6 billion. The consensus earnings estimate was $3.24 per share on revenue of $2.3 billion. Aside from that, SQM was able to grow revenue by 342.0% on a year-over-year basis.
SQM’s Chief Executive Officer, Ricardo Ramos, commented, “We are very pleased with our results for the first half of the year. These results were related to favorable market conditions related to fertilizers, iodine and lithium and decades of investment, hard work, R&D and know-how.” Year-to-date, shares of SQM stock are up over 119.34% so far. On top of that, SQM stock closed Thursday’s trading day up another 5.43% at $111.27 per share. With this in mind, do you think SQM can keep up its momentum throughout the remainder of 2022 and beyond?
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