5 Dividend Stocks That Investors May Bank On for Growth

Core Viewpoint - Dividend investing is a prominent segment in the stock market, providing consistent income amidst market volatility and geopolitical uncertainties [1][2]. Group 1: Dividend Growth Strategy - Dividends serve as a major source of income for investors, reducing portfolio volatility and often outperforming in unstable markets [2][4]. - Focusing on stocks with a history of dividend growth can lead to higher returns and capital appreciation compared to simply high-yield dividend stocks [2][5]. - Stocks with strong dividend growth are typically from mature companies, providing a hedge against economic and political uncertainties [4][5]. Group 2: Selected Dividend Growth Stocks - Five dividend growth stocks identified as solid choices include Tapestry, Inc. (TPR), RTX Corporation (RTX), Cintas Corporation (CTAS), Broadcom Inc. (AVGO), and Corning Incorporated (GLW) [3]. - Tapestry has an estimated earnings growth rate of 14.4% and a Zacks Rank of 2 [10]. - RTX has an estimated earnings growth rate of 7% and a Zacks Rank of 2 [11]. - Cintas has an estimated earnings growth rate of 13.7% and a Zacks Rank of 2 [12]. - Broadcom has an expected earnings growth rate of 29.6% and a Zacks Rank of 2 [13]. - Corning has an expected earnings growth rate of 18.9% and a Zacks Rank of 2 [14]. Group 3: Investment Criteria - Stocks selected for dividend growth should have a 5-Year Historical Dividend Growth greater than zero, indicating a solid dividend growth history [6]. - Additional criteria include positive historical sales and earnings growth, as well as expected future earnings growth [7]. - A Price/Cash Flow ratio less than the industry average indicates undervaluation, while a 52-Week Price Change greater than the S&P 500 ensures better performance [8]. - Stocks with a Growth Score of B or better combined with a Zacks Rank of 1 or 2 are considered to have the best upside potential [9].