It might be time to consider dividend stocks for the remainder of 2022 since many analysts still predict turbulent times for the stock market.
Dividend stocks can help diversify a portfolio that might be overly focused on growth. They produce income during good times, bad times, and—especially crucial today—during periods of high inflation. For example, compared to a year prior, U.S. consumer prices increased 8.5% in July.
Over the long term, they frequently outperform the S&P 500.
Here are three dividend-paying stocks that could make life easier during inflationary periods:
Waste Management (WM)
Although not the most attractive of professions, waste management is a crucial one. Municipalities have no choice but to pay businesses to dispose of our mountains of trash, regardless of what the economy does, even if those costs rise.
Waste Management has established itself as one of the major players in the industry. Over the previous five years, the shares have more than doubled. Additionally, management expects a 10% increase in revenue this year.
Waste Management’s dividend has increased for 19 years running and currently yields 1.5%. Investors shouldn’t have to worry about receiving their checks because the company has paid out almost $1 billion in dividends over the past year and expects to generate about $2.5 billion in free cash flow in 2021.
As a business whose fortunes typically follow those of the larger economy, Caterpillar is in an interesting position following the pandemic. This is to be expected when your equipment is a mainstay on construction sites all over the world.
Although a paralyzed global supply chain is having an impact on the company’s revenues, historically low-interest rates and President Joe Biden’s recently passed $1.2 trillion infrastructure bill indicate that there may be a lot of construction in the United States in the near future.
The mining and energy divisions of Caterpillar also offer exposure to commodities, which typically perform well when inflation is high. Over the past five years, the company’s stock has increased by more than 55% as a result of higher prices for raw materials and petroleum.
Caterpillar’s quarterly dividend is currently valued at $1.20 per share and has a yield of 2.5% after announcing an 8% increase in June. For 28 years in a row, the company has increased its yearly dividend.
Walmart was able to operate its more than 4,700 U.S. stores throughout the pandemic because grocery stores were recognized as essential businesses.
Since COVID spread throughout the world, the company has not only increased profits and market share, but many customers turn to Walmart when prices are going up because of its reputation as a low-cost haven.
Over the past 49 years, Walmart has steadily increased its dividends. With a $2.24 annual payout per share, it currently has a dividend yield of 1.6%.
Walmart’s share price is currently $136, well below the $160.77 52-week high it reached in April.
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