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.
Target has taken the first position on the list, as the company has been battling with falling sales even as competitors are thriving. Star Bulk Carriers is second, as the company’s shares are declining despite continuing to post strong results. Third on the list is LyondellBasell Industries, which also has seen weak business fundamentals. Last is Johnson and Johnson, the healthcare and medical equipment manufacturer that is posting strong operational performance but faces legal uncertainty.
Don’t forget to read our previous edition of trends here.
Target Underperforms Peers
Giant retailer Target (TGT) has taken the first position on the list, seeing a jump in traffic of 157%. Target has been woefully underperforming its peers lately. While Target stock is down 9% this year, peers Walmart and Costco Wholesale are up 78% and 52%, respectively.
Target has failed to attract customers in the current economic backdrop, as consumers cut on non-discretionary items, which its stores focus on the most. It also has struggled to compete on pricing, with both Walmart and Costco offering the same quality products at lower price points.
Target revenue growth has been flat over the past three quarters. In the latest quarter, the company missed analyst expectations for both revenues and earnings. Target’s CEO blamed the results on a budget-conscious consumer. Walmart, meanwhile, has seen sales growth of 5.5% in the last quarter, while net income jumped to more than $4.6 billion.
Despite the drop in the stock price, Target’s dividend yield remains average at about 3.44%.
Source: Barchart
Star Bulk Carriers Stock Falls
Star Bulk Carriers (SBLK) has placed second on the list this week, with a hike in viewership of 73%. Star Bulk Carriers, a Greek shipping company, has seen its shares decline more than 37% year-to-date, despite posting relatively strong results.
For the third quarter of 2024, the company reported net income of $81.2 million, up from $43 million in the same period last year. Star Bulk management said it stays optimistic on its medium-term prospects, noting the Chinese government stimulation should help the economy.
Star Bulk has been returning most of its earnings to shareholders, resulting in a payout ratio of 77.5%. Star Bulk’s dividend yields an impressive 14.2%, largely due to its very low valuation. The stock currently trades at a price-to-earnings ratio of 5.
Source: Barchart
LyondellBasell Industries Stock Drops on Challenging End Markets
LyondellBasell Industries (LYB) is third on the list, seeing an increase in traffic of 56%. LyondellBasell Industries, a chemical materials maker, has seen its stock decline more than 20% so far this year, as most of its end markets have been rather weak.
The company makes a range of chemicals used in the packaging, automotive, and construction industries. Both the automotive and construction industries have been rather weak, although there are early signs of a recovery in automotive. As a result of low demand for its refining and oxyfuel business, the company plans to exit this business unit. LyondellBasell Industries appears to be cheaply priced at a price-to-earnings ratio of about 12.
LyondellBasell Industries has a high dividend yield of nearly 7% and has been increasing it every year for the past 13 years.
Source: Barchart
Johnson & Johnson Posts Strong Earnings, but Challenges Remain
Johnson & Johnson JNJ (JNJ) is last on the list, with an increase in traffic of 24%. Johnson & Johnson, a healthcare and medical devices manufacturer, has been comfortably beating analyst estimates for sales and net income in recent quarters.
In the quarter ending September, Johnson & Johnson reported revenue growth of 5.25%, while adjusted earnings per share of $2.42 beat expectations of $2.21 per share. However, the stock is flat for the year, as investors assessed the ongoing litigation over its talc product causing cancer. The legal hurdles have weighed on the stock for the past quarters.
The company also said that its medical equipment division has suffered from slowdowns in China and Japan.
Johnson & Johnson pays an annual dividend of nearly $5 per share, equal to a dividend yield of 3.30%.
Source: Barchart
The Bottom Line
Target is struggling compared to its peers, while Star Bulk Carriers and LyondellBasell offer high dividend yields but face market challenges. Johnson & Johnson is performing well despite legal and market setbacks.
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