4 Great Value Stocks With Over 4% Dividend Yield
Zacks Investment Research | Jun 13, 2016 10:21PM ET
The global economic scenario is still volatile with a stronger dollar, lower oil prices, slowdown in the Chinese economy and weak job numbers coming from the U.S. Investors remain cautious ahead of central bank meetings, kicking off with the Federal Reserve’s policy decision on Wednesday, and the Brexit vote on Jun 23, which will decide the fate of Britain's membership in the European Union.
Moreover, investors are a bit anxious following a disappointing Q1 earnings season. Amid the rising volatility, it can be tricky for investors to make profitable investment decisions.
In this scenario, a wise investment decision for the risk averse investors would be to focus on value stocks (the stocks most likely to perform well based on valuation measures) offering high yields. As price appreciation of a stock is largely uncertain, it would be safe to invest in stocks that provide steady income in the form of regular dividends.
Value + Dividend
Opting for value stocks could be a wise idea as value investing offers an opportunity to enter the market and grab stocks that are trading cheap and have been overlooked by a majority of investors. On the other hand, some investors prefer stocks that offer dividend income as part of the total returns.
Stocks that are inexpensive and also offer a decent dividend income are always attractive. This strategy may protect the portfolio from a disaster, in the event of a massive economic downturn.
How to Pick the Best Stocks?
Selecting a dividend stock with cheap price could be a daunting task as one must consider not only the past performance of the company but also its prospects. A stock that has paid huge dividends in the past but may see troubled times ahead will obviously not fit the bill.
The choices could be narrowed down based upon a favorable Zacks Rank #1 (Strong Buy) or Zacks Rank #2 (Buy) and promising value metrics (Value Score of’A’ or ‘B’) using our new Original post
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