Are These The Best Dividend Stocks To Invest In Right Now?
With inflation persisting at elevated levels, and the U.S. economy officially in a technical recession, investors may be on the lookout for the best dividend stocks in the stock market. After all, they offer a stable passive income stream for investors in times of volatility. Moreover, companies that can afford to pay out consistent dividends tend to have an established track record and may be better able to weather any economic storms. As such, it is no surprise that many investors are looking to bolster their portfolios with dividend stocks.
What Is A Dividend?
A dividend is a distribution of a company’s earnings to shareholders. Dividends are typically paid once a quarter, and the amount of the dividend is determined by the board of directors based on the company’s profitability. While some companies reinvest their profits back into the business, others choose to pay out dividends to their shareholders.
For dividend investors, this provides a way to receive regular income from their investment. In addition, dividend payments can also be a signal of a company’s financial health. Therefore, dividend-paying stocks are often favored by investors seeking stable, long-term growth.
How To Find The Best Dividend Stocks In 2022
When it comes to finding dividend stocks in the stock market, there are a few things you’ll want to keep in mind. First, you’ll want to look for companies that have a history of paying dividends. This will give you an idea of how likely they are to continue paying dividends in the future. Second, you’ll want to look at the company’s financials to make sure they’re in good shape. You don’t want to invest in a company that isn’t doing well financially, as there’s a risk they may have to cut their dividend payments.
Finally, you’ll want to consider the company’s dividend yield. This is the percentage of the stock price that is paid out as a dividend. A higher yield means more income for you, but it also means more risk. With these things in mind, you should be able to find some great dividend stocks that fit your investment goals.
Notably, there is no shortage of dividend stocks for investors to choose from in the stock market today. This would be the case as this section of the market stretches across numerous industries globally now. For example, top consumer staples companies such as Coca-Cola (NYSE: KO) and PepsiCo (NASDAQ: PEP) have good track records of paying dividends for decades. With that, here are three of the best dividend stocks to watch in 2022.
Best Dividend Stocks To Buy [Or Avoid] In 2022
- Southern Copper Corp (NYSE: SCCO)
- Innovative Industrial Properties, Inc. (NYSE: IIPR)
- Devon Energy Corp. (NYSE: DVN)
Southern Copper Corp (SCCO)
First up, let’s look at Southern Copper (SCCO). They are one of the largest integrated copper producers in the world. The company also produces molybdenum, zinc, lead, coal, and silver. Its mining, smelting, and refining facilities are located in Peru and Mexico. The company also has ongoing exploration activities in those countries and Chile. In fact, the company boasts some of the highest copper reserves in the mining industry and has strong long-term copper and molybdenum market fundamentals. Southern Copper has a current dividend yield of 10.35%.
Notably, SCCO has fallen short of earnings estimates in two of the last three quarters. The mining company most recently reported Q2 earnings earlier this week. Southern Copper (SCCO) reported earnings of $0.56 per share on revenue of $2.3 billion. In comparison with, the consensus earnings estimate of $0.95 per share. With that, shares of SCCO stock are down 18% year-to-date. Should investors be watching SCCO stock on their dividend stock watchlist?
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Innovative Industrial Properties, Inc. (IIPR)
Next, we have Industrial Innovative Properties (IIPR), which focuses solely on the procuring and leasing of industrial properties. The company mainly marketed toward state-licensed marijuana growers as production facilities. In essence, IIPR’s take on the weed industry is a unique one, to say the least. Regardless of scale, weed producers looking to enter the growing U.S. market will need space. Furthermore, the company has a current dividend yield of 7.68%.
For a sense of scale, a report from Grand View Research showed legal marijuana sales could grow at a compound annual growth rate (CAGR) of 26.7% between 2021 and 2028. The company announced this week it will report results for its second quarter ended June 30, 2022, after the market closes on Wednesday, August 3, 2022. With the regulated cannabis industry positioned for significant growth, would IIPR Stock be a good dividend stock to have in your portfolio?
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Devon Energy Corp. (DVN)
Last up, let’s check out oil and gas company Devon (DVN). The company’s operations are focused onshore in the U.S. with five core areas. Specifically, Delaware Basin, Eagle Ford, Powder River Basin, Anadarko Basin, and Williston Basin. Devon prides itself on delivering a consistently competitive shareholder return. Not to mention, shares of DVN stock have rallied by more than 37% year-to-date. DVN stock currently trades at $62.85 as of Friday’s close. What’s more, the company has a current dividend yield of 8.53%.
Last week, Devon announced that it has completed its previously announced acquisition of the leasehold interest and related assets of RimRock Oil and Gas, LP in the Williston Basin. The deal has a total cash consideration of $865 million, minus purchase price adjustments. In detail, this will add a contiguous position of 38,000 net acres, of which 88% is working interest, directly offsetting and overlapping Devon’s existing position. As a result, this will position Williston Basin assets to sustain high-margin production and strong cash flow for many years.
Moving on, the company is set to report announced it will report second-quarter 2022 results on Monday, Aug. 1, 2022 after the close of markets. With all this in mind, will you be watching DVN stock this week?
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