CFRA analyst picks Exxon and 9 other dividend stocks to buy in a choppy market
The mismatch between the S&P 500's record-breaking gains and the problems in the U.S. economy has Wall Street increasingly worried about the risks of a correction
Amid growing investor concern over the contrast between the rally on Wall Street and weakening U.S. economic indicators, stocks of companies with a good dividend history can become a protective element of a portfolio, Barron's writes with reference to Sam Stovall, chief investment strategist at the Center for Financial Research and Analysis (CFRA). He suggested paying attention to ten stocks that can protect investors from losses during stock market selloffs.
Details
CFRA analyst Sam Stovall finds that stocks in the S&P 500 index with the highest dividend yields (4.5% on average) are less volatile than the market as a whole. However, he warns of the risks: higher yields can be associated with hard-to-predict dividend payouts. For his top 10 high-yielding but relatively stable stocks, the economist selected companies from the S&P 500 index with a "buy" rating that return no more than 75% of their profits to shareholders.
Among these companies are familiar to many "blue chips": Exxon Mobil with a yield of 3.4%, Merck with 3.7% and Target with 4.7%. These securities are not without risks: for example, Target's shares fell by almost 30% in 2025 amid problems with modernization of stores and development of an effective strategy of online sales. Last week, the company said it would cut nearly 2,000 office workers as part of its anti-crisis measures. Nevertheless, CFRA considered such optimization a positive step that should help the retailer get back on track in the next few years.
CFRA also included in its top shares Hasbro and Invesco (dividend yield of both - 3.6%), which have shown good performance this year but still have upside potential. Comcast (yielding 4.9%), EOG Resources (3.8%), Omnicom Group (3.5%), J.M. Smucker (4.2%) and VICI Properties (5.8%) also made the list.
Context
The stock market and the U.S. economy have been moving in opposite directions lately, Barron's notes, with the S&P 500 hitting a record more than 30 times since the start of the year, while the country has a government shutdown due to a budget dispute in Congress, the labor market is slowing, and annual inflation is stuck at 3% - with the Fed's target of 2%.
This article was AI-translated and verified by a human editor
