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.
Cisco has taken the first position in the list, as the company is seeking to gain foothold in the emerging artificial intelligence space via investments in startups. Second in the list is Enterprise Products Partners, the oil and gas pipeline that has raised its distribution to shareholders. Third in the list is PepsiCo, which recently agreed to make a large acquisition. Last in the list is Pfizer, which has performed abysmally recently and has attracted an activist investor.
Don’t forget to read our previous edition of trends here.
Cisco Bets on AI Startups
Cisco Systems (CSCO) has taken the first position in the list, with an advance in viewership of 46%. Cisco has been in the news after the company stepped up its efforts to invest in artificial intelligence startups.
Cisco is reportedly finalizing an investment in Coreweave, a cloud services provider for artificial intelligence workloads. Cisco invested at a $23 billion valuation, allowing early investors and employees to cash out. In addition, Cisco has set up a $1 billion fund to specifically invest in AI startups, as it seeks to gain a foothold in the rapidly developing field.
Cisco shares have advanced nearly 9% so far this year, as the overall market rallied. Cisco’s operational performance has been rather disappointing, with revenue and net income declining in four of the past five quarters. Cisco pays an annual dividend of $1.60 per share, equaling to a yield of 3%. The company has been increasing its dividend in each of the past 13 years.
Source: Barchart
Enterprise Products Partners Maintains High Dividend
Oil and gas pipeline Enterprise Products Partners (EPD) has placed second in the list with an increase in viewership of 26%. The pipeline operator has declared a quarterly dividend of 52.5 cents per share, which is 5% higher than the same period last year. EPD raised its dividend to this level in the previous quarter.
EPD shares have continued to rally this year, up 10%, as financial results have been relatively strong. The stock has finally reached its pre-pandemic levels, when low demand for oil tanked EPD. Revenues were up 26% in the last quarter, while net income increased 12% year-over-year. Sequentially, EPD posted declines in both earnings and revenues.
EPD could see a boost to its results after oil prices have rallied due to tensions in the Middle East.
Source: Barchart
PepsiCo Bets on Healthy Mexican Food
PepsiCo (PEP) has taken third place in the list, seeing traffic surge by 20%. PepsiCo was in the news after it agreed to acquire Mexican food maker Siete Foods for $1.2 billion. Siete makes Mexican-inspired foods like tortillas, sauces, cookies, and snacks.
Siete has about $500 million in revenue by selling its products across 37,000 stores, including Whole Foods. By acquiring Siete, PepsiCo is seeking new growth opportunities in the healthy snack category.
PepsiCo’s revenue growth has largely stagnated over the last four quarters, although net income increased. As a result, shares have fallen by more than 3% so far this year. The company’s dividend yields 3.3%, essentially offsetting shareholder returns to zero this year.
Source: Barchart
Pfizer Targeted by Activist Investor
Pfizer (PFE) has taken the last position in the list, seeing an increase in traffic of 19%.
Pfizer shares have lost more than half of their value since reaching a peak at the end of 2022, as the company was ill-prepared for falling demand for its COVID-19 vaccine, which it made in collaboration with BioNTech. Revenues and net income have taken a big hit.
The company’s challenges have attracted activist investor Starboard Value, which has reportedly taken a $1 billion stake and enlisted former executives to help with a turnaround plan. Pfizer has been criticized for squandering its cash pile from the pandemic era on acquisitions that have failed to deliver cash-generating new drugs.
Pfizer’s dividend yields nearly 6% but could be at risk if the company’s operational performance continues to disappoint.
Source: Barchart
The Bottom Line
Cisco is betting that investments in AI startups like Coreweave will help it gain a foothold in the emerging artificial intelligence era. Enterprise Products Partners has maintained the same dividend as last quarter, when it hiked it by 5%, as results continue to improve. PepsiCo is betting on Mexican food with its acquisition of Siete Foods. Lastly, Pfizer’s poor operational performance and misguided M&A strategy have attracted an activist investor.
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