Resiliency – it’s what investors need right now. From geopolitical issues and a slowing global economy to the re-emerging coronavirus pandemic, there’s plenty of risk in the world. To that end, investors need to find and own firms with large moats and steady revenues streams. And if they just happen to operate in fast-growing businesses with long runways, even better.
This sums up our Best Dividend Stocks List pick in the aerospace & defense sector.
After spinning out some of its slower-moving divisions, our pick is now a lean, mean aerospace machine, which has benefited it in numerous ways. A focus on highly engineered goods with fat margins has allowed our pick to avoid any slowdown in the industry due to the pandemic. A shift to the so-called connected aerospace market and software has only strengthened those margins even further and boosted sales, as governments, OEMs and airlines look to save on costs. All in all, the pandemic has had little effect on the firm’s earnings and revenues.
In fact, the COVID-19 crisis has had the opposite effect: It’s actually boosted its fortunes.
To some extent, this is because our pick is also a major player in personal protective equipment (PPE), N95 masks, and other gear used by medical professionals and first responders. The COVID-19 crisis has only strengthened its earnings further. And with the pandemic entering its second wave, our pick is geared up to further leverage its business model.
For investors, our pick’s industrial focus in several high-growth areas has simply resulted in great earnings, strong cash flows and a dividend that continues to rise.
To summarize, here are five reasons why you should own this stock:
- Global diversified manufacturer covering a wide range of high- and low-tech products across various sectors.
- Recorded a nearly 25% increase in sequential EPS as several business lines showed double-digit sales growth.
- Has smartly used spin-outs to improve results and boost profits further.
- Thanks to strong results, the firm was able to increase its dividend by more than 3% at a time when others in its sector are cutting payouts.
- Healthy payout ratio of 54% and growing yield of 2.26%.
Our Best Dividend Stocks List has 20 of the highest-rated stocks by our proprietary Dividend.com Rating system. Go Premium to find out the entire list.
