When the stock market goes up, dividend stocks are a good way to invest because they are all-weather investments. From 1991 to 2020, dividend-paying stocks had a 13.3% monthly standard deviation and non-dividend-paying stocks had 15.7%.
Bank of America predicts the S&P 500 will end 2024 between 4,700 and 4,900 points by 2024, driven by the Federal Reserve’s economic expansion, but since the index is already over 5,350, the BAC number is more of a benchmark now. What’s more, RBC and Goldman Sachs are also bullish on lower inflation, higher consumer spending and growth in U.S. corporate profits.
If you’re unsure if the positive stock momentum will continue, invest in three Dividend Aristocrat stocks with double-digit upsides. The first is giving its 227th bonus amid a challenging retail climate. Second, a home repair leader shows how digital capabilities may counter consumer spending declines. The last is an industry veteran maintaining a forty-year streak of dividend increases.
Target (TGT)
Target (NYSE:TGT) will pay its 227th dividend on Jun. 10. Its annual yield of 2.99% is a cut above the consumer staples sector average of 1.89% and is sustainable, considering a 42% forward payment ratio, complimenting 22% upside in its stock.
However, balancing the bull thesis is sluggish consumer spending, leading to earnings of $2.03 per share in the fiscal first quarter. That was short of Wall Street’s expectation for $2.06 as shoppers bought less food and other basics and less expensive clothing and home decor. Despite its first profit drop since November 2022, TGT reaffirmed its guidance.
Customers visiting the store or online dropped 1.9%, as did their average spending, but digital sales gained 1.4%, the first rise in over a year. When sales dropped, Target discounted thousands of diapers, bread, paper towels and other basics to give customers a better deal.
Target also used in-store activities and picture opportunities to promote Taylor Swift’s current album along with its collaboration with tennis and lifestyle brand Prince to sell pickleball gear.
In 2024, Target wants to renovate 2,000 current sites and establish 300 new ones. New Ulta Beauty stores-within-stores and changes to enable same-day services like drive-up and in-store pickup are among these improvements. Additionally, the business is relaunching Target Circle, its reward program, with new membership choices.
Lowe’s (LOW)
Lowe’s (NYSE:LOW) recent 5% dividend increase to $1.15 per share marks 52 consecutive years of hikes. The payout yields 2.1% and is much higher than the consumer cyclical sector average of around 1%. There is no surprise analysts project 16% upside for LOW.
Sales and profits for Lowe’s first quarter of 2024 exceeded Wall Street expectations. It made $3.06 per share, more than the $2.94 predicted. Sales for the quarter of $21.36 billion beat estimates of $21.12 billion but fell year over year. For the last five quarters, sales have shown a similar pattern as consumers spend less on kitchen renovations, garden sets and barbecues.
Spending on do-it-yourself projects decreased, but Lowe’s focus on business customers and online sales made up for it.
On a brighter note, Lowe’s now has same-day delivery services from Shipt, DoorDash (NASDAQ:DASH) and Instacart. Adding on this service makes home improvement projects easier, especially in the spring and summer.
What’s more, Apple‘s (NASDAQ:AAPL) Vision Pro, one of Lowe’s newest home remodeling tools, was shown off at SXSW 2024 to give customers a more immersive kitchen design experience in-store. Lowe’s stores also accept Apple Pay now, which makes shopping easier and more up-to-date for customers.
PPG Industries (PPG)
PPG Industries (NYSE:PPG), with 52 consecutive years of dividend hikes, reported record net sales of $4.9 billion for the second quarter and raised its guidance for the whole year. Segment margins went up by 330 basis points from one year to the next
The global supplier of paints has started to consider its architectural coatings business in the U.S. and Canada more tactically. The strategic review’s goal is to examine different strategy options for this business area.
PPG has promised to spend $300 million to build a new factory and improve the ones they already have. The company is making this effort as part of its plan to improve its industrial skills in North America.
PPG will continue to support the Tasca Racing team through the 2024 drag racing season. The PPG Ford Dark Horse Nitro Mustang Funny Car will be at a number of NHRA events, showing that PPG is dedicated to racing and brand awareness. As a result, PPG continues to attract institutional investors like TD Asset Management, which recently expanded its holding by 5%. Analysts are projecting an 18% upside in PPG stock.
On the date of publication, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
