Dividend.com analyzes the search patterns of our visitors each week. By sharing these trends with our readers, we hope to provide insights into what the financial world is concerned about and how to position your portfolio.
AT&T has taken first position in the list, as the large telecommunications company has declared an unchanged dividend. Second in the list is Enterprise Products Partners, whose stock has been on a tear in recent years. In third spot is defense contractor Lockheed Martin, which recently gained a few large contracts. The list is closed by Bank of America, whose stock has been one of the worst performers this year.
Don’t forget to read our previous edition of trends here.
AT&T Declares Dividend
AT&T (T) has placed first this fortnight, experiencing an increase in viewership of 26%. AT&T was in the news as the company declared an unchanged quarterly dividend of 27.7 cents per share. AT&T cut its dividend in half in mid-2022, as it was burdened by a high amount of debt as a result of two large bad acquisitions, which were later undone at a big loss.
And the company still has to make capital outlays to improve its infrastructure. Just this month, the company committed an additional $3B billion to build internet infrastructure in remote areas of the U.S. The total amount earmarked by the company increased to $5 billion.
Given the large debt load and slow growth, the company’s stock trades at a price-to-earnings ratio of just 8.8. This means its dividend yields a strong 6.4%, although it is unclear if it will be cut. The company’s debt has been falling at a slow pace, even as it continued to shed assets.
Source: Barchart
Enterprise Products Partners Stock Hovering Near Pre-Pandemic Levels
Enterprise Products Partners (EPD) has placed second in the list, with an advance in viewership of 18%.
Enterprise Products, a leading midstream natural gas and crude oil pipeline, has seen its stock rise 10% year-to-date and is currently trading at the highest level since the COVID-19 pandemic in 2020 led to a dramatic drop.
The company is investing heavily in new plants to increase production. It recently announced plans to build a natural gas processing plant in the Permian Basin, which it expects to process more than 300 million cubic feet of natural gas per day.
Financial results have been improving. In the latest quarter ended December 2023, the company reported revenue increased 7% year-over-year to $14.6 billion, while net income was up 10.4% to $1.6 billion. On top of strong price performance, the company pays a dividend that yields 7% annually, 3 percentage points higher than the average energy yield.
Source: Barchart
Lockheed Martin Continues to Bag New Contracts
Lockheed Martin (LMT) is third in the list with an increase in viewership of 18%, equal to Enterprise Products Partners.
The defense contractor was recently in the news after it secured a contract for the modification of its F-35 aircraft worth $440 million. Moreover, Lockheed, like other defense contractors, is benefitting strongly from geopolitical worries, especially the Russia-Ukraine war. Countries close to Ukraine are making orders in the billions of dollars to boost their defenses. Since the war started in 2022, Poland has already spent $10 billion with Lockheed Martin to buy HIMARS rocket launchers.
Lockheed Martin’s stock has been trading near record highs. Meanwhile, the company has been increasing its dividend for 21 consecutive years. Its dividend currently yields 2.8%.
Source: Barchart
Bank of America Expects a Boost in Its Investment Banking Division
Bank of America (BAC) has taken the last spot, with an increase in traffic of 17%. The bank has been one of the worst performers from the largest banks this year, as financial results somewhat disappointed.
Revenues in the latest quarter ended December 31 declined 11%, while net income was down 56%. For the first quarter of 2024, the company expects higher revenue from investment banking, as M&A picked up this year, while markets are likely to be flat.
The bank has been increasing its dividend for three consecutive years and is likely to hike the payout to shareholders this year as well. The bank’s dividend currently yields 2.56%, which is lower than the financials average of 3.2%. Bank of America pays just about a quarter of its earnings to investors, so there might be room for further hikes.
Source: Barchart
The Bottom Line
AT&T has declared an unchanged dividend, as the company still struggles with a lot of debt on the balance sheet and low growth. Enterprise Products Partners is seeing its shares trading higher than before the pandemic as financial results continued to improve. Lockheed Martin has been getting large contracts, while Bank of America has been one of the worst performers this year out of all the large U.S. banks.
Be sure to check out Dividend.com’s News section for the most trending news around income investing.
