September is well-known for its seasonal weaknesses, and recent soft economic data has revived recession fears. No doubt, the stock market was subjected to bouts of volatility in the first three trading sessions of September, with investors fearing more to come. They are also contemplating whether the Federal Reserve is behind the curve on interest rate cuts.
Amid this gloomy scenario, investors should keep an eye on stocks that pay dividends consistently, a tell-tale sign of a healthy business model. Stocks that have raised dividends recently exhibit a sound financial structure and can counter market upheavals. Some of the prominent names are Phillips Edison & Company PECO, RCI Hospitality RICK, Itau Unibanco ITUB, Lowe's Companies LOW and Lam Research LRCX.
Weak Economic Data
The Institute of Supply Management reported that there has been a decline in manufacturing activity for the past three consecutive months. For August, the manufacturing index came in at 47.2%, less than the consensus estimate of 47.6%. It is important to note any reading below 50 indicates a contraction in manufacturing activities.
The July Job Openings and Labor Turnover Survey report indicates a slowdown in the U.S. labor market as job openings have decreased by 237,000 to 7.7 million, the lowest level since January 2021. The ratio of job openings to available workers has reduced from more than two jobs per worker in early 2022 to less than 1.1 jobs per worker currently.
US Fed Rate Cut Ahead?
All eyes are on when the Fed intends to start interest rate cuts, to ease the burden on American businesses. Fed Chairman Jerome Powell has confirmed ending the high-interest rate regime in his speech at the annual Jackson Hole Economic Policy Symposium.
Investors are now worried about whether the Fed will be able to create the right balance without derailing the economy.
Dividend Stocks to Watch: PECO, RICK, ITUB, LOW, LRCX
Given the high volatility in the market, stocks that tend to reward investors with a high dividend payout outperform non-dividend-paying stocks in a highly volatile market.
Phillips Edison & Company
Phillips Edison & Company is an owner and operator of omni-channel grocery-anchored neighborhood shopping centers. This Cincinnati, OH-based company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
On Sept. 3, PECO declared that its shareholders would receive a dividend of 10 cents a share on Oct. 1, 2024. PECO has a dividend yield of 3.2%.
Over the past five years, PECO has increased its dividend four times, and its payout ratio presently sits at 50% of earnings. Check Phillips Edison & Company’s dividend history here.
Phillips Edison & Company, Inc. Dividend Yield (TTM)
Phillips Edison & Company, Inc. Dividend Yield (TTM)
Phillips Edison & Company, Inc. dividend-yield-ttm | Phillips Edison & Company, Inc. Quote
RCI Hospitality
RCI Hospitality is headquartered in Houston, TX. This Zacks Rank #3 (Hold) company owns and operates adult nightclubs that offer live adult entertainment, restaurant and bar services.
On Sept. 3, RICK declared that its shareholders would receive a dividend of 7 cents a share on Sept. 30, 2024. RICK has a dividend yield of 0.6%.
In the past five years, RICK has increased its dividend six times. Its payout ratio at present sits at 46% of earnings. Check RCI Hospitality’s dividend history here.
RCI Hospitality Holdings, Inc. Dividend Yield (TTM)
RCI Hospitality Holdings, Inc. Dividend Yield (TTM)
RCI Hospitality Holdings, Inc. dividend-yield-ttm | RCI Hospitality Holdings, Inc. Quote
Itau Unibanco
Itau Unibanco is a financial holding company that provides a vast array of credit and other financial services to a diverse customer base of individuals and companies in and outside Brazil, via its international branches, subsidiaries and affiliates. The Zacks Rank #3 company is headquartered in S?o Paulo, Brazil.
On Aug. 30, ITUB announced that its shareholders would receive a dividend of 4 cents a share on May 7, 2025. ITUB has a dividend yield of 0.5%.
Over the past five years, ITUB has increased its dividend 24 times. Its payout ratio now sits at 50% of earnings. Check Itau Unibanco's dividend history here.
Lowe's has evolved as one of the world’s leading home improvement retailers, offering services to homeowners, renters and commercial business customers. This Mooresville, NC-based company currently carries a Zacks Rank #3.
On Aug. 30, LOW declared that its shareholders would receive a dividend of $1.15 a share on Nov. 6, 2024. LOW has a dividend yield of 1.9%.
Over the past five years, LOW has increased its dividend five times, and its payout ratio presently sits at 38% of earnings. Check Lowe's Companies’ dividend history here.
Lowe's Companies, Inc. Dividend Yield (TTM)
Lowe's Companies, Inc. Dividend Yield (TTM)
Lowe's Companies, Inc. dividend-yield-ttm | Lowe's Companies, Inc. Quote
Lam Research
Lam Research is headquartered in Fremont, CA. This Zacks Rank #3 company supplies wafer fabrication equipment and services to the semiconductor industry
On Aug. 6, LRCX declared that its shareholders would receive a dividend of 74 cents a share on Sept. 4, 2024. LRCX has a dividend yield of 1.3%.
In the past five years, LRCX has increased its dividend five times. Its payout ratio at present sits at 43% of earnings. Check Lam Research’s dividend history here.
Lam Research Corporation Dividend Yield (TTM)
Lam Research Corporation Dividend Yield (TTM)
Lam Research Corporation dividend-yield-ttm | Lam Research Corporation Quote
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