3 High-Yield Dividend Stocks Poised to Rise – TradingView News

Dividend yields are often the first metric used when choosing income investments. However, having traded stocks since 1999, I’ve come to realize that returns don’t paint the whole picture. For example, returns are not guaranteed; companies can stop growing, cut back, or even stop paying dividends. As a result, income investors must consider factors other than just yield when selecting stocks.

How I found the following companies

I used Barchart’s Free Stock Screener tool to select the cheapest, highest valued, and highest yielding stocks using the following criteria:

• Minimum analyst rating: 4.5
• Analysts covering the stock: Minus 8
• A TTM P/E: <10

And to be 100% sure, I double-checked whether the bottom line’s price-to-earnings ratio was lower than the industry’s price-to-earnings ratio.

I normally limit my analysis to sectors like Dividend Aristocrats, Kings or REITs. This time, however, I want a comprehensive view of the overall market, so I’ve included stocks listed on the NYSE, NYSE Arca, NASDAQ, OTC-US, and other non-common stocks.

In terms of my chosen criteria, I used the number of analysts to ensure that we obtain consensus scores from many sources, rather than just one or two. Meanwhile, the price-to-earnings ratio (P/E) is a good indicator of how cheap a stock is. However, P/E is relative and should be compared with the the sector’s price/earnings ratio to determine cheapnesswhich I did, and I included the sector’s price-to-earnings ratio in every result.

The result? 193 possible contenders.

Then I clicked on the ‘Div Yield(a)’ column to see the list of today’s cheapest, highest rated stocks with the highest yields so you can decide if they are worth buying.

Civitas Resources CIVI

Civitas Resources is an oil and gas company that acquires, explores, develops and produces crude and natural gas products. The company operates in Denver-Julesburg and the Permian Basin. In addition, Civitas is also the first carbon-neutral energy producer in Colorado and has a comprehensive ESG framework guiding its operations.

2023 was not good for Civitas, as net income fell from $1.248 billion in 2022 to $784.2 million. As a result, diluted earnings per share fell to $9.02 from $14.58 last year. However, CEO Chris Doyle expresses optimism for this year, stating: “Our focus in 2024 is clear: maximize free cash flow, return money to owners and maintain our strong balance sheet.”

Based on its last quarterly payout, which was $1.45 (50 cents regular and 95 cents additional dividend), it is well on its way to delivering on its promise to shareholders. Based on the last quarterly dividend, Civitas pays an annual dividend of $5.80, which reflects a yield of 8.22%; You can call their ‘extra dividend’ the icing on the cake.

CIVI stock also has a perfect 5 rating from 10 analysts, calling it a Strong Buy. Finally, it is trading at a discount, with a ttm price-to-earnings ratio of 8.33, well below the industry average of 12.15.

Blackstone secured loans BXSL

Blackstone Secured Lending is an investment company that invests primarily in senior secured debt and first lien unitranche loans. The company operates in many industries, including software, aerospace and defense, air freight and logistics, commercial services and supplies, healthcare providers and services, and more.

94.75% of the company’s investments are in the United States, with the remainder in Canada and Europe. As of December 31, 2023, Blackstone Secured Lending has $9.9 billion in investments.

The company pays 77 cents per quarter, which translates into an annual interest rate of $3.08 or a yield of 9.62%. In addition to that excellent return, BXSL stock has an average rating of 4.50, which considers it a strong buy based on ten analyst scores.

Compared to the S&P 500 Financial Sector’s 15.12, Blackstone’s price-to-earnings ratio of 8.13ttm is quite cheap.

Meanwhile, Blackstone Secure Lending’s Q4 23 financials resulted in improved numbers. Net investment income was 7% higher than the same period last year, while net income grew 16%. The company also has $1.8 billion in cash and undrawn debt, ready to be mobilized for business growth.

Trinity capital TRIN

Trinity Capital is an investment firm specializing in venture debt and equipment financing for companies such as Impossible Foods, Super73 and Axiom Space, among its other 330 growing investments.

TRIN stock looks quite cheap, with a price-to-earnings ratio of 6.93 ttm, compared to the industry average of 15.12. Eight analysts rate the company as a Strong Buy, with an average of 4.5.

In terms of dividends, Trinity Capital tops our list with an annual interest rate of $2.04, which translates into a strong yield of 14.08%.

This return is exclusive special dividend payments, which the company has paid out five times in the last two years.

Meanwhile, Trinity’s Q1’24 report – hot off the presses on May 1, 2024 – reported excellent results. Total investment income reached a record $50.5 million, up 21.5% year-on-year. Net investment income also reached new highs of $25.2 million, representing an increase of 30.1%.

The first quarter also marks the thirteenth consecutive increase in the company’s regular quarterly dividends. With such great performance and a top-notch dividend yield, Trinity is in a great financial position to continue to grow its payouts and give investors a good reason to be excited about the future.

Should you buy a high-yield stock?

High-yield stocks can be a good choice. Highly rated stocks are also excellent.

But as I’ve written several times before, this is one of the best lessons I’ve learned in the past 25 years of trading: never base your stock selection on a single metric. It doesn’t matter whether it’s about returns, analyst rating, price-earnings ratio or just plain hype. Smart money combines multiple metrics and a little intuition to make a final choice.

As of the date of publication, Rick Orford had (neither directly nor indirectly) any positions in the securities mentioned in this article. All information and data in this article are for informational purposes only. For more information, please review the Barchart Disclosure Policy here.