In a market like this, you always can find dividend stocks to buy. If you’re like most investors, you probably can’t wait for 2023. History books will show that 2022 was a huge disappointment for the stock market, although it did create some compelling opportunities for top-tier dividend stocks.
First of all, dividend stocks are a huge benefit in any portfolio. Dividend stocks pay a quarterly or monthly payment to shareholders, who can use the money for income (a great idea for retirees). Or for younger investors, a regular dividend payment can be reinvested into the market to help grow your portfolio quicker.
My Dividend Grader is a great tool to find these top-tier dividend stocks to buy. The Dividend Grader evaluates dividend stocks on a variety of metrics and assigns a letter grade – just like in school, the best dividend stocks get an “A” or “B” rating.
It’s similar to my Portfolio Grader tool, which also grades stocks based on earnings, analyst sentiment, momentum and qualitative standards.
You can find great dividend stocks to buy in a variety of sectors – this list includes defense, energy, biotech, materials and real estate. While the names and sectors vary, all of these stocks have one thing in common – they’re among the best dividend stocks you can buy heading into 2023.
|ABR||Arbor Realty Trust||$14.01|
|SBLK||Star Bulk Carriers||$19.90|
Lockheed Martin (LMT)
Geopolitical tensions aren’t great for a lot of reasons, but one way to capitalize is defense contractors like Lockheed Martin (NYSE:LMT). Lockheed Martin is one of the biggest and most well-known contractors in the world and is always among the best dividend stocks to buy.
While the stock market spent much of 2022 in correction territory, LMT is up more than 30% on the year as the U.S. keeps a wary eye on the war in Ukraine and tensions with China and North Korea.
No doubt, Lockheed Martin makes money hand over fist. It brought in $16.58 billion just in the third quarter. While the company narrowly missed estimates of $16,68 billion, that appears to be a minor setback. Lockheed reaffirmed its outlook for the full year, for which it says it expects revenue of $65.25 billion and full-year earnings per share of $21.55.
Lockheed provides a solid dividend yield of 2.6%, helping push it to an “A” rating in the Portfolio Grader and a “B” rating in my Dividend Grader.
As a top biotech stock, Amgen (NASDAQ:AMGN) is on the cutting edge of providing treatments for a variety of ailments, including rheumatoid arthritis, bone cancer and psoriasis.
While it’s not a household name, Amgen has succeeded in building an impressive pipeline of medications that keeps that revenue and earnings rolling in.
Revenue in the third quarter was $6.65 billion, topping estimates by $100 million. Earnings per share were also solid at $4.70 per share, better than the $4.45 that the experts predicted.
Meanwhile, the stock is up more than 18% so far this year with most of those gains coming since early September when Amgen impressed investors and analysts alike by unveiling updated long-term positive data about the effectiveness of Repatha drug that is used to treat high cholesterol.
AMGN stock has a dividend yield of 2.7%. It has an “A” rating in the Portfolio Grader and a “B” rating in my Dividend Grader.
Arbor Realty Trust (ABR)
If you’re looking for reliable income from a stock, it rarely hurts to consider the best real estate names in the market. One of the best right now is Arbor Realty Trust (NYSE:ABR), which is involved with Fannie Mae and Freddie Mac loan programs, FHA and low-income loans, and bridge loans.
Arbor is a real estate investment trust or REIT. REITs are special types of investments because they are required to distribute 90% of their taxable earnings to shareholders. That can create some pretty extraordinary payout ratios and ABR is no exception – currently, it pays a dividend yield of 10.8%.
Admittedly, with high interest rates there’s always a risk that the housing market will be slow for a while. But ABR doesn’t seem to be affected by the problem. Arbor topped top- and bottom-line estimates for revenue and EPS in each of the first three quarters.
Arbor Realty has a “B” rating in the Dividend Grader.
Star Bulk Carriers (SBLK)
Star Bulk Carriers (NASDAQ:SBLK) has a stock price just under $20, but it paid a mammoth dividend over the last year of $6.55.
Its last three quarterly dividends came in at $1.25, $2 and $1.65. So, you’re looking at a dividend yield for SBLK of more than 30% right now.
Star Bulk transports dry bulk goods around the world on its fleet of 128 vessels. As the world is still coming to grips with the effects of Covid-19 shutdowns on the supply chain, Star Bulk’s vessels appear to be in demand. That should keep the profits coming in for shareholders.
SBLK stock has a “B” rating in my Portfolio Grader and an “A” rating in the Dividend Grader.
Diamondback Energy (FANG)
Texas-based Diamondback Energy (NASDAQ:FANG) is an energy exploration company that is involved with petroleum, natural gas liquids and natural gas.
Its holdings are in the Permian Basin in west Texas, where it also recently acquired the assets of Lario Permian, a subsidiary of Lario Oil & Gas Co., in exchange for $850 million plus 4.18 million shares of FANG stock. The deal gives Diamondback access to another 25,000 acres in the Northern Midland Basin. The deal is expected to close in late January.
That keeps Diamondback in growth mode. The company reported revenue in Q3 of $2.44 billion, which was more than 30% greater than a year ago. The revenue number also beat analysts’ expectations of $2.42 billion. EPS for the third quarter was also a pleasant surprise, coming in at $6.48 versus expectations of $6.36.
FANG stock is up 48% so far this year and offers a dividend yield of 5.3%. Not surprisingly, it has “A” ratings in both the Dividend Grader and the Portfolio Grader.
Commercial Metals (CMC)
As a major provider of recycled steel, Commercial Metals (NYSE:CMC) maintains operations in the United States and Poland.
Its recycled metals are used in bridges, roads, automobiles, airports and other major buildings. The company is the largest manufacturer of steel reinforcing bar, known as rebar, in North America and central Europe.
Earlier this month, CMC completed its acquisition of a Texas metal recycling facility and related assets from Kodiak Resources, adding another 55,000 tons of annual capacity to its portfolio.
Earnings for the company’s fiscal fourth quarter beat estimates on both the top and bottom lines. CMC reported revenue of $2.41 billion and EPS of $2.45, versus estimates for $2.37 billion revenue and EPS of $2.23.
Commercial Metals stock is up 30% so far this year and has a dividend yield of 1.4%. That gives it “A” grades in both the Dividend Grader and the Portfolio Grader.
Devon Energy (DVN)
No stock on this list has grown as much in 2022 as Devon Energy (NYSE:DVN). Fueled by higher oil and natural gas prices, Devon stock is up more than 60% on the year. And even if the globe sinks into a recession, Devon stock should be fine because analysts project crude oil prices to remain high for the next several years.
On Nov. 1, Devon announced a dividend of $1.35 per share; a 61% increase from a year ago. That puts Devon’s dividend yield at a whopping 7.3%.
The Oklahoma company should also benefit from the Biden administration’s deal with the European Union. Washington wants to reduce the EU’s reliance on Russian natural gas by providing at least 15 billion cubic meters of liquified natural gas in 2022.
As long as Russia remains at odds with the west, companies like Devon stand to capitalize in European markets.
DNV stock has an “A” rating in the Portfolio Grader and the Dividend Grader.
On the date of publication, Louis Navellier had a long position in LMT, AMGN, SBLK, CMC and DVN. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.