In an economic climate where the Federal Reserve is expected to lower interest rates, investors are turning their eyes toward dividend-paying stocks as viable income-generating investments. With evolving market conditions, these stocks are likely to become more appealing due to their reliable dividend yields, which often outshine the returns seen in traditional savings options like bonds. However, with countless options available, selecting the right dividend stocks can be a daunting task for individual investors. Engaging the analysis and recommendations from leading financial experts can streamline this process. This article highlights three noteworthy dividend stocks based on insights from top-rated analysts on the TipRanks platform.
One notable dividend stock worth considering is EPR Properties (EPR). As a real estate investment trust (REIT), EPR specializes in experiential properties, including movie theaters, amusement parks, and ski resorts. The company currently boasts a significant dividend yield of 7.3%. Recently, RBC Capital analyst Michael Carroll upgraded his rating on EPR from hold to buy, raising the price target from $48 to $50. Carroll’s confidence is grounded in the belief that EPR has successfully navigated challenging periods, including the pandemic and industry-wide strikes, positioning itself favorably for future performance.
The analyst’s outlook suggests that the theatrical box office is likely to rebound in the latter half of 2024, leading to enhanced revenue opportunities for EPR as its tenants thrive. Importantly, Carroll addressed concerns surrounding AMC, one of EPR’s key tenants, indicating that the company’s proactive measures are easing worries about its instability. Furthermore, with a payout ratio of nearly 70% of adjusted funds from operations and a compounding annual debt-to-EBITDA ratio of 5.2 times, EPR’s dividend appears secure. Carroll holds the 703rd position among over 9,000 analysts, with an impressive 63% success rate in his ratings, showcasing his reliability in stock selection.
Energy Transfer: Fueling Growth in the Energy Sector
Another compelling option for dividend-seeking investors is Energy Transfer (ET), a limited partnership focused on providing midstream energy solutions. The company recently announced a quarterly distribution of 32 cents per unit, indicating a year-over-year growth of 3.2% and an attractive dividend yield of 8%. Following the release of its Q2 results, Stifel analyst Selman Akyol noted that Energy Transfer exceeded EBITDA expectations while revealing significant growth opportunities, particularly in its Permian-to-Gulf-Coast operations.
With the rising demand for natural gas—partly driven by the energy needs of artificial intelligence data centers—Akyol is optimistic about Energy Transfer’s future. The company is well-positioned to meet the increasing energy requirements in data hubs, particularly in states like Texas and Florida that are experiencing population growth. Akyol reaffirmed a buy rating on ET stock, setting a price target of $19, and noted his rank at 137 among an extensive pool of analysts, completing 71% of his recommendations with a remarkable average return of 10.3%. This highlights his expertise in identifying growth opportunities.
Lastly, Walmart (WMT) continues to be a strong contender in the realm of dividend stocks, having recently released impressive figures for the second quarter of fiscal 2025. The retail behemoth not only exceeded expectations but also raised its full-year outlook, a move that reflects its robust performance in the first half of the year. Walmart is devoted to returning value to shareholders through dividends and share repurchases. So far this year, the company has distributed over $3 billion in dividends and repurchased $2.1 billion in shares. The recent 9% dividend hike to 83 cents per share marks the 51st consecutive year of increases.
Baird analyst Peter Benedict reiterated a buy rating on Walmart following the company’s impressive Q2 results, boosting his price target from $70 to $82. Benedict attributes Walmart’s market share growth to its strategic focus on value and convenience, noting that approximately 70% of U.S. comparable store growth is digitally driven. Additional signals of success include a rise in the company’s trailing return on investment to 15.1%, fueled by investments in automation and cutting-edge technologies such as generative AI. With a ranking of 35 among more than 9,000 analysts, and a 71% success rate backed by an average return of 15.9%, Benedict’s insights provide a strong endorsement for Walmart as a compelling dividend investment.
As the financial landscape shifts and interest rates lower, dividend-paying stocks like EPR Properties, Energy Transfer, and Walmart offer investors attractive opportunities for income and growth. Encouraged by insightful analyses, investors can navigate the complex terrain of dividend stocks and make informed choices that align with their financial goals.