But the Federal Reserve isn’t finished raising interest rates, and recession talk abounds. Stock investors aren’t out of the woods yet. That can make dividend stocks attractive if the yields are high and the companies produce more cash flow than they need to cover the payouts.
The purpose of the list is to provide a starting point for further research. These stocks may be appropriate for you if you are looking for income, but you should do your own assessment to form your own opinion about a company’s ability to remain competitive over the next decade. If we divide a company’s estimated annual free cash flow per share by its current share price, we have its estimated free cash flow yield. If we compare the free cash flow yield to the current dividend yield, we may see “headroom” for cash to be deployed in ways that can benefit shareholders.For real-estate investment trusts, dividend-paying ability is measured by funds from operations , a non-GAAP figure that adds depreciation and amortization back to earnings.
Here are the 21 companies that passed the screen, with dividend yields of at least 5% and estimated 2023 FCF yields at least twice the current payout. They are sorted by dividend yield:
Can’t people receive 4% annualized from 3 month Banker acceptance notes? Of course you don’t get the growth opportunity but in this environment growth isn’t looking very likely.
Really!
5% dividend on earnings depreciation and multiple contraction.