Warren Buffett, the legendary Oracle of Omaha and arguably the most famous investor who has ever lived, owes a great deal of his success to his buying and selling approach that focuses on blue-chip stocks. Dividend stock. There are large dividend holders like Berkshire Hathaway Bank of America Corporation NYSE: BAC And Apple Inc. NASDAQ: AAPL Earn the company billions of dollars in dividend distributions each year.
Fixed dividends can be a strong defensive strategy during times of stock market turbulence—these companies are well-established and less likely to fall amid widespread volatility—and the passive income they provide through distributions. can be reinvested in compounding gains. Still, a company’s dividend metrics provide only part of an investor’s broader view of that firm as a potential investment target. So it can also be helpful for dividend-seeking investors to consider what Wall Street thinks more broadly about a particular stock before jumping into it.
In the field of dividend stocks, three firms stood out for a large number of recent buy ratings from Wall Street analysts. Motorola Solutions Inc. NYSE: MSI, Nike Inc. NYSE: NKEAnd Townsquare Media Inc. NYSE: TSQ.
Motorola Solutions: Outstanding Demand in a Growing Industry
Motorola Solutions is a telecommunications company specializing in radio systems, security, and surveillance technology, and control systems and software. It operates independently of the Motorola smartphone brand, the two companies split in 2011.
Motorola Solutions Dividend Payments
- Dividend yield
- 0.95%
- Annual dividend
- $4.36
- Track record of dividend growth
- 13 years
- Annual 3-year dividend growth
- 11.24%
- Dividend payout ratio
- 47.75%
- Next dividend payment
- January 15
Motorola Solutions’ recent performance impressed investors: In the third quarter of 2024, it reported a 9.2% year-over-year increase in revenue and an increase in operating cash flow.
Driving this performance is strong demand for the company’s security products, which have a range of applications including police work, retail shopping, border security, and more. Fortunately for Motorola, this demand shows no signs of slowing down and, in fact, is likely to grow in the short term.
Eight out of nine analysts rate the company Motorola Solutions a Buy Agreed price target of $504.88 is more than 9% above current levels by January 2, 2025. Despite the fact that MSI’s shares are already up more than 48% leading up to that date as well.
Nike: Hard times, but a change is possible
2024 has been difficult for Nike, with shares down nearly 30% in the year to January 2, 2024. Failed direct-to-consumer effortsPoor sales in Asian markets, and reduced consumer spending in the US
NIKE Dividend Payments
- Dividend yield
- 2.17%
- Annual dividend
- $1.60
- Track record of dividend growth
- 22 years
- Annual 3-year dividend growth
- 11.23%
- Dividend payout ratio
- 49.38%
- Recent dividend payments
- January 2
Heading into 2025, however, there are reasons for optimism. Ex CEO Elliot Hill The company bounced back late in the year, helping beat consensus estimates on EPS for its first quarter. Still, the firm expects it will take time to rebuild — it predicts a sharp revenue decline for the current quarter while Hill aims to restore its business with wholesalers and focus on top brands. have to do
All of this is to say that now may be the time for investors to buy the dip. Despite recent challenges, Nike remains one of the world’s leading athletic and sportswear companies.
The firm maintains its strength as a dividend player, with a payout ratio above 49% and a dividend yield of 2.13%. Given the recent drop in share price, analysts see Nike shares rising nearly 19% to reach a consensus price target of $89.58.
Townsquare Media: Revenue increases upon launch of SummitMedia partnership
Townsquare Media is a small-cap digital media firm with over 80% upside, according to analyst ratings. After a period of share price volatility, the company recently announced a return to overall and digital revenue growth in its November 2024 earnings report.
Townsquare Media Dividend Payments
- Dividend yield
- 8.26%
- Annual dividend
- $0.79
- Dividend payout ratio
- -29.15%
- Next dividend payment
- 1 February
More importantly, the company’s partnership with SummitMedia, announced in October, is likely to bear fruit in 2025.
The partnership expands Townsquare’s reach into new markets, including Honolulu, Birmingham, Omaha, and Louisville.
Townsquare likely remains undervalued based on a P/S ratio of 0.3. If it is able to continue to grow revenue, it will also have an easier time maintaining an impressive dividend payout ratio of 8.5%.
While not as stable as the aforementioned Motorola or Nike, Townsquare still offers some attractive prospects for dividend investors.
Before you consider Motorola solutions, you’ll want to hear this.
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