In late July, the Dow Jones Industrial Average slid more than 700 points in a single session to log its worst single-day decline since October. Shares have since rebounded, and the major stock market indexes all continue to flirt with new all-time highs, but it’s worth noting that the big gains of the last year or two seem much harder to come by. Specifically, the Dow Jones is more or less flat from where it was at the start of May.
That hints that gains could be tougher to score in the months ahead — and could be a sign that income-oriented dividend stocks may provide not just stability but also a nice flow of cash to ensure your nest egg keeps growing.
If you’re interested in dividend stocks right now, here are five that look particularly strong at the start of August:
— EPR Properties (ticker: EPR)
— Navient Corp. (NAVI)
— Pfizer Inc. (PFE)
— Vedanta Ltd. (VEDL)
— Vistra Corp. (VST)
[Sign up for stock news with our Invested newsletter.]EPR Properties (EPR)
Dividend yield: 5.7%
EPR is a leading “net lease” real estate investment trust, meaning it demands clients pay for ancillary expenses like maintenance or insurance on the properties while it just cashes the rent check. It’s not a shopping mall or residential real estate firm, however, and focuses on “out of home leisure and recreation experiences,” including movie theaters, beach resorts and ski slopes across more than 40 states. Obviously, with the overall easing of coronavirus restrictions, EPR has been seeing a huge recovery to its business compared with its performance last summer in the throes of lockdowns. Shares are up about 60% year to date, and EPR just resumed a 25 cent quarterly dividend in July. That bodes well both for future performance and future dividends.
Navient Corp. (NAVI)
Dividend yield: 3.2%
Student loan provider Navient was not exactly a popular stock a year or two ago amid political discussions of student debt forgiveness, which were followed closely by fears of an economic downturn caused by coronavirus disruptions that would upset the payments of young graduates. The financial firm’s quarterly dividend of 16 cents, however, went uninterrupted throughout the upheaval, and now NAVI stock is facing an uptrend considering that both the economic and political outlook have improved. Shares are up a huge 150% or so in the last 12 months, and it still offers a dividend that’s more than twice the S&P 500, even after that run.
Pfizer Inc. (PFE)
Dividend yield: 3.6%
Big Pharma mainstay Pfizer has outperformed the broader stock market slightly in 2021, continuing to ride high on its high-profile success developing an effective coronavirus vaccine. Given the risk posed by variants of the disease, along with a continued push to vaccinate worldwide now that many developed markets have gotten their shots, investors could continue to see a decent tailwind for PFE in the near term. On top of that, don’t forget this $240 billion drugmaker remains one of the most dominant health care companies on the planet, and one of the most reliable dividend stocks out there with an amazing streak of 330 consecutive quarterly dividends paid to shareholders.
Vedanta Ltd. (VEDL)
Dividend yield: 5.1%
Vedanta is an India-based industrial conglomerate that operates a diversified natural resources business spanning oil and gas production as well as coal, silver and copper mining. It also takes the energy sources it extracts and operates power generation facilities, operating an arm that is a major electric utility in the nation. Given that this stock is in an emerging market and not as large as other materials stocks at only about $14 billion, there’s a bit more risk here than in other similar stocks. But with a generous dividend and rising revenues, thanks to the global economic recovery, this stock has been a top performer lately with year-to-date returns of more than 60% in 2021.
Vistra Corp. (VST)
Dividend yield: 3.1%
A Texas-based utility company, Vistra is an electricity provider — one of the most stable businesses on Wall Street. But VST also has modest growth potential as it operates in six of the seven wholesale markets where utilities compete for customers, thanks to deregulation. Right now, it has nearly 5 million residential, commercial and industrial connections in about 20 states. Additionally, it announced construction of a 1,600 megawatt-hour battery energy storage system in California, which has captivated investors. Shares have underperformed year to date in 2021, but are up about 30% from their spring lows — and continue to offer a generous dividend on top of this short-term momentum.
