Chicago, IL – March 11, 2024 – Stocks in this week’s article are Cardinal Health Inc. CAH, Toll Brothers TOL, Iron Mountain IRM, NetApp NTAP and Ralph Lauren Corp. RL.
Dividend investing remains a popular choice, irrespective of market conditions. This strategy focuses on companies that not only pay dividends but also consistently increase them over time. This approach offers a unique blend of income and growth potential, appealing to a broad range of investors. Additionally, it provides a sense of security in times of market uncertainty or downturns, as dividend-paying stocks can reduce the volatility of a portfolio and tend to outperform in a choppy market.
Stocks with a strong history of year-over-year dividend growth form a healthy portfolio with a greater scope of capital appreciation, as opposed to simple dividend-paying stocks or those that have high yields. We have selected five dividend growth stocks — Cardinal Health Inc., Toll Brothers, Iron Mountain, NetApp and Ralph Lauren Corp. — that could be solid choices for your portfolio.
Stocks that have a strong history of dividend growth belong to mature companies, which are less susceptible to large swings in the market and, thus, act as a hedge against economic or political uncertainty, as well as stock market volatility. At the same time, these offer downside protection with their consistent increases in payouts.
Additionally, these stocks have superior fundamentals that make dividend growth a quality and promising investment for the long term. These include a sustainable business model, a long track of profitability, rising cash flows, good liquidity, a strong balance sheet and some value characteristics. Further, a history of strong dividend growth indicates that a dividend increase is likely in the future.
Although these stocks do not necessarily have the highest yields, they have outperformed for a longer period than the broader stock market or any other dividend-paying stock.
Here are five of the 11 stocks that fit the bill:
Ohio-based Cardinal Health is a nationwide drug distributor and provider of services to pharmacies, healthcare providers and manufacturers. The company saw a positive earnings estimate revision of 16 cents over the past 30 days for the fiscal year (ending June 2024), with an expected earnings growth rate of 25.7%.
Cardinal Health presently has a Zacks Rank #1 and a Growth Score of B. You can see the complete list of today's Zacks #1 Rank stocks here.
Pennsylvania-based Toll Brothers builds single-family detached and attached home communities, master-planned luxury residential resort-style golf communities, and urban low, mid, and high-rise communities, principally on the land it develops and improves. TOL saw a solid earnings estimate revision of $1.34 over the past 30 days for the fiscal year (ending October 2024) and has an expected earnings growth rate of 9.8%
Toll Brothers has a Zacks Rank #1 and a Growth Score of A.
Massachusetts-based Iron Mountain provides records and information management services and data center space and solutions in 59 countries. It saw a positive earnings estimate revision of 15 cents over the past 30 days for this year with an estimated earnings growth of 6.3%.
Iron Mountain has a Zacks Rank #2 and a Growth Score of B.
California-based NetApp provides enterprise storage as well as data management software and hardware products and services. It assists enterprises in managing multiple cloud environments, adopting next-generation technologies like artificial intelligence, Kubernetes, and contemporary databases, and navigating the complexity brought about by the quick development of data and cloud usage.
NetApp saw a positive earnings estimate revision of 3 cents for the fiscal year (ending April 2024) over the past 30 days, with an estimated earnings growth rate of 10.7%. NetApp currently sports a Zacks Rank #1 and has a Growth Score of A.
New York-based Ralph Lauren is a major designer, marketer and distributor of premium lifestyle products in North America, Europe, Asia and internationally. It offers products in apparel, footwear, accessories, home furnishings and other licensed product categories. The company saw a solid earnings estimate revision of 60 cents over the past month for the fiscal year (ending March 2025) and has an expected earnings growth rate of 9.5%.
Ralph Lauren has a Zacks Rank #1 and a Growth Score of A.
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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2237807/5-dividend-stocks-with-high-growth-prospects
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Iron Mountain Incorporated (IRM) : Free Stock Analysis Report
NetApp, Inc. (NTAP) : Free Stock Analysis Report
Cardinal Health, Inc. (CAH) : Free Stock Analysis Report
Ralph Lauren Corporation (RL) : Free Stock Analysis Report
Toll Brothers Inc. (TOL) : Free Stock Analysis Report
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