4 Stocks to Watch on Dividend Hikes as Inflation Fears Linger
Investors were eagerly awaiting the June inflation numbers last week as both the consumer price index (CPI) and the producer price index (PPI) came up with an impressive reading. The CPI rose a modest 0.2% month over month in June.
Year over year, CPI rose 3% in June from May’s reading of 4%. Core CPI, which strips out the volatile energy and food prices, also increased 0.2%, the smallest increase in nearly two years.
The PPI data, which was released a day later on Jul 13, showed that producer price inflation increased only 0.1% in June, beating expectations of an increase of 0.2%. Core PPI, which excludes the volatile energy and food prices, also rose 0.1%, which was in line with expectations.
Stocks rallied following that, with all three major indexes recording solid gains. The Dow ended the week 2.3% higher, while the S&P 500 and the Nasdaq closed up 2.4% and 3.3%, respectively.
The June inflation reading has raised optimism among market participants that the Fed might finally end its interest rate hike cycle in the coming days.
The central bank paused its interest rate hike in June, but Fed chair Jerome Powell last month said that two more interest rate hikes would still be required by the end of this year as inflation, despite showing signs of easing, is still high.
Inflation fell to 4.8% from the record high of 9.1% a year ago but is still a lot higher than the Fed’s target level of 2%. This is mainly because the labor market has been resilient amid interest rate hikes.
Job creation has slowed lately, but the economy managed to add 209,000 jobs in June. Alongside, the unemployment rate fell to 3.6%, while the average hourly wages jumped 4.4% in June.
Stocks in Focus
Given this situation, investing in dividend-paying stocks would be a wise decision. Dividend stocks with a solid business plan and a proven track record are known for handling market volatility. An astute investor should thus consider stocks that have recently raised their dividend payments. Four such companies are The J. M. Smucker Company SJM, Avient Corporation AVNT, AptarGroup, Inc. ATR and Conagra Brands, Inc. CAG.
The J. M. Smucker Company is a leading marketer and manufacturer of consumer food and beverage products and pet food and pet snacks in North America. SJM boasts a strong portfolio of iconic food and beverages. The J. M. Smucker Companymainly caters to coffee, pet food, peanut butter, fruit spreads, baking products, ready-to-spread frostings, frozen sandwiches, flour, juices and beverages, and portion control products.
On Jul 14, The J. M. Smucker Companydeclared that its shareholders would receive a dividend of $1.06 a share on Sep 1, 2023. SJM has a dividend yield of 2.76%. Over the past five years, The J. M. Smucker Companyhas increased its dividend five times, and its payout ratio at present sits at 46% of earnings. Check The J. M. Smucker Company’s dividend history here.
The J. M. Smucker Company Dividend Yield (TTM)
The J. M. Smucker Company dividend-yield-ttm | The J. M. Smucker Company Quote
Avient Corporation provides specialized and sustainable material solutions. AVNT, formerly known as PolyOne Corporation, is based in Cleveland.
On Jul 13, Avient Corporation announced that its shareholders would receive a dividend of $0.25 a share on Oct 6, 2023. AVNT has a dividend yield of 2.45%. Over the past five years, Avient Corporation has increased its dividend five times, and its payout ratio at present sits at 38% of earnings. Check Avient Corporation’s dividend history here.
Avient Corporation Dividend Yield (TTM)
Avient Corporation dividend-yield-ttm | Avient Corporation Quote
AptarGroup, Inc. is a global supplier of a broad range of innovative dispensing, sealing, and active packaging solutions for the beauty, personal care, home care, prescription drug, consumer health care, injectables, food and beverage markets. ATR’s main products include dispensing pumps, closures, aerosol valves, and elastomeric primary packaging components. AptarGroup has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
On Jul 13, AptarGroup declared that its shareholders would receive a dividend of $0.41 a share on Aug 17, 2023. ATR has a dividend yield of 1.28%. Over the past five years, AptarGroup has increased its dividend three times, and its payout ratio at present sits at 40% of earnings. Check AptarGroup’s dividend history here.
AptarGroup, Inc. Dividend Yield (TTM)
AptarGroup, Inc. dividend-yield-ttm | AptarGroup, Inc. Quote
Conagra Brands, Inc. is one of North America's leading branded food companies. CAG offers premium edible products, with a refined focus on innovation. Conagra Brands maintains a highly dynamic product portfolio and incorporates alterations within it as per the preference pattern of the end-users.
On Jul 13, Conagra Brands announced that its shareholders would receive a dividend of $0.35 a share on Aug 31, 2023. CAG has a dividend yield of 4.01%. Over the past five years, Conagra Brands has increased its dividend four times, and its payout ratio at present sits at 48% of earnings. Check Conagra Brands’ dividend history here.
Conagra Brands Dividend Yield (TTM)
Conagra Brands dividend-yield-ttm | Conagra Brands Quote
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