Market Leaders: 3 Dividend Stocks That Defied Gravity
When it comes to investing, it’s natural to be cautious about buying stocks at all-time highs. However, companies with a proven track record of growth and a strong outlook can often justify their record market capitalization. In fact, megacap growth stocks have been driving the broader indexes to new heights.
Oil and Gas Giant ExxonMobil: A Dividend Powerhouse
ExxonMobil has been on a tear this year, outperforming the S&P 500 and recently hitting an all-time high. The company’s strong second-quarter financial results, which included a $500 million earnings contribution from its Pioneer merger, have motivated energy investors to buy in. With a forward yield of 3.1%, ExxonMobil’s dividend remains an attractive feature. As the company continues to develop growth projects related to alternative energy, investors may choose to power their portfolios with ExxonMobil stock.
Vistra: Nuclear Power and Cloud Computing
Microsoft’s recent 20-year power purchasing agreement with Constellation Energy signals a growing recognition of nuclear power’s potential. Vistra, which expanded its nuclear capability through its acquisition of Energy Harbor, is well-positioned to benefit from this trend. With 6,400 MW of nuclear capacity, Vistra’s long-term earnings and cash-flow prospects could have significant upside potential. This could lead to a dividend hike and excellent capital returns for investors.
Home Depot: A Cyclical Company Ready to Thrive
After a brutal sell-off earlier this year, Home Depot stock has rocketed 19% higher in the last three months. While fundamentals haven’t changed, improved investor sentiment and lower interest rates could help consumers, the housing market, and in turn, Home Depot. With a price-to-earnings ratio of 27.6, Home Depot’s valuation may seem steep, but if the company can kick into a new growth gear, it could make today’s valuation reasonable in hindsight. Plus, Home Depot’s excellent dividend, yielding 2.2%, makes it an attractive option for income investors.
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