3 Dividend Stocks I Cannot Buy Enough Of

Economic Outlook - The U.S. economy is facing mixed signals regarding a potential recession, with J.P. Morgan raising the odds of a recession by year-end to 35% and Citi predicting a 40% chance going into next year [3][4]. - The Leading Economic Index (LEI) indicates a recession is likely, as it is at levels historically associated with recessions [6]. - Despite poor leading indicators, coincident indicators remain strong, suggesting that the economy is not yet in decline [8]. Market Sentiment - The number of S&P 500 companies mentioning "recession" in earnings calls was only 28 in Q2 2024, significantly lower than in 2022 and 2023, indicating a more optimistic outlook [12]. - Revenue growth for S&P 500 companies accelerated to 5% in Q2 2024, the highest since Q4 2022, which contradicts recession fears [12]. Federal Reserve Policy - The current Federal funds rate is between 5.25% and 5.50%, with expectations of a 25 basis points rate cut in September 2024, followed by gradual declines to 3.25% to 3.50% by July 2025 [12][14]. - The market's expectation of rate cuts suggests confidence in the Fed's ability to support the economy, which may prevent a deeper recession [14]. Investment Opportunities - LandBridge Company LLC is highlighted as a high-conviction investment due to its unique business model of owning land in the Permian Basin, which provides exposure to energy royalties and potential high-margin growth [20][21]. - Deere & Company is positioned for recovery in the agriculture sector, with strong fundamentals and a focus on efficiency improvements, despite facing current economic headwinds [36][39]. - L3Harris Technologies, Inc. is noted for its strong position in the defense sector, with expectations of revenue and earnings growth, alongside a commitment to returning excess free cash flow to shareholders [45][48].