Dividend Stocks
  • Quality dividend stocks like these can see portfolios through good times and bad. Buy these and hold them forever.
  • AbbVie (ABBV): 3.64% forward yield. The market is overreacting to recent news with this pharmaceutical giant.
  • Best Buy (BBY): 3.86% forward yield. An economic slowdown may not affect its ability to keep raising its dividend.
  • ConAgra Brands (CAG): 3.46% forward yield. Its status as a defensive stock may outweigh concerns about inflationary pressures.
  • Darden Restaurants (DRI): 3.28% forward yield. Cost saving measures could reduce the impact of an economic downturn.
  • Fidelity National Financial (FNF): 4.31% forward yield. Even as earnings move lower, more-than-sufficient dividend coverage.
  • Southern Copper (SCCO): 6.05% forward yield. Investors may be underestimating how long the copper boom lasts.
  • Walgreens Boot Alliance (WBA): 4.19% forward yield, loss in “boost” from vaccination wave won’t affect current rate of payout.
Source: iQoncept/shutterstock.com

Looking for plays that can perform well in any market? Consider dividend stocks. Whether in a bull market and a bear market, high-quality names in this category provide steady returns through their respective payouts.

During bear markets, these types of plays can show greater resiliency. During bull markets, shares in fundamentally-superior companies with a steady dividend perform well. They may not go parabolic like some growth names when the market’s trending higher, but they do typically experience steady appreciation during such market conditions.

However, the key words here are “high-quality” and “fundamentally superior.” Not every stock with a payout makes a great play, yet if you focus on quality first, yield second, you can find many names that stand to provide solid returns over a long timeframe. Through bull markets, bear markets, and everything in-between. That’s the case here with these seven A-rated dividend stocks:

ABBV AbbVie $156.27
BBY Best Buy $93.23
CAG ConAgra Brands $35.46
DRI Darden Restaurants $132.07
FNF Fidelity National Financial $39.42
SCCO Southern Copper $61.84
WBA Walgreens Boot Alliance $44.39

AbbVie (ABBV)

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After going on a tear during early 2022, AbbVie (NYSE:ABBV) stock has pulled back this month. Mostly, due to the announced exit of a key executive. Along with this, news of falling sales for a drug (lymphoma therapy Imbruvica) that it co-developed with another pharmaceutical giant.

These developments may be putting pressure on it, but neither item affects the long-term bull case for this stock. Much like a past concern that’s largely been absorbed (the prospect of falling sales for its blockbuster drug Humira), other factors outweigh the executive exit and Imbruvica news.

Namely, this company’s robust pipeline. The strength of its pipeline gives it a strong chance of meeting or beating expectations in the years ahead. In turn, maintaining and growing its $1.41 per share quarterly dividend (yield of 3.64%). Trading at a low valuation (11x expected earnings), you may want to dive in after its recent weakness.

This stock earns an “A” rating in my Dividend Grader.

Best Buy (BBY)

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You may think that Best Buy (NYSE:BBY) isn’t exactly a “great buy” right now. After all, with news of in-store traffic going down, and the prospect of a slowdown in spending on big-ticket items due to inflation, and the prospect of an economic slowdown caused the Federal Reserve’s efforts to tame inflation (rate hikes), it may seem like there’s disappointment ahead for shares in this electronics retailing giant.

Keep in mind, though, the big drop BBY stock has seen (from $140 to $90 per share) since November. Chances are these near-term issues are more than priced-in. Not only that, it’s possible the crowd is underestimating how resilient will be during a more challenging economic environment.

Resiliency will likely enable it to not only maintain its current 70 cent per share quarterly dividend (3.86% forward yield). It will likely enable it to keep raising this dividend, as it’s done eight years in a row.

This stock earns an “A” rating in my Dividend Grader.

ConAgra Brands (CAG)

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A major packaged foods company, inflation has been top of mind with investors when it comes to shares in ConAgra Brands (NYSE:CAG). The most recent outlook provided by management suggests it’s having trouble passing rising costs onto consumers.

While upping its sales forecast, it has slashed its earnings forecast. Interestingly though, CAG stock has moved up throughout the month. Why? It’s possible that investors, already aware of both inflationary pressures, plus the fading of its pandemic-era tailwinds, have moved on from both issues. Instead, seeking steadier plays, as rising interest rates make more speculative stocks less appealing, they’re cycling into this safe harbor stock.

Given it has more-than-enough coverage for its dividend (forward yield of 3.46%), and room to raise it further? We could see the market move more into this defensive play. This in turn could mean a continued trip higher, despite worries about inflation’s impact on earnings.

This stock earns an “A” rating in my Dividend Grader.

Darden Restaurants (DRI)

Source: Shutterstock

Darden Restaurants (NYSE:DRI), operator of restaurant chains like Olive Garden and Longhorn Steakhouse, may also seem like an odd choice to buy at this stage in the economic cycle. As inflation affects consumer spending, and as the Fed’s tightening plans threaten to slow down the economy, won’t its performance be affected?

Not so fast. The positive impact of the post-pandemic re-opening has so far outweighed the headwind of rising prices. Also, through efforts it made during the lockdown era, it’s been able to reduce operating costs.

That is why, per analyst consensus, Darden is on track to see its earnings rise from $4.77 per share last fiscal year (ending May 2021) to $7.38 per share this fiscal year. While earnings growth from here may come more slowly, it stands to be more than enough to enable management to continue growing the quarterly dividend for DRI stock (3.28% forward yield).

This stock earns an “A” rating in my Dividend Grader.

Fidelity National Financial (FNF)

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After talking about some of the more well-known dividend stocks, let’s take a look at a more under-the-radar play. Fidelity National Financial (NYSE:FNF) isn’t a name meme traders will ever get excited about.

A provider of title insurance, the boom in residential real estate has been a boon for the company, and for FNF stock. The rush to buy houses resulted in big revenue/earnings growth in 2021. Yes, as housing demand begins to soften, there’s concern its strong operating performance will take a hit.

However, although earnings are set to drop this year, a possible housing market slowdown so far doesn’t appear to be one on-par with the late 2000s housing crash. It’s expected to earn $6.10 per share in 2022, and $6.36 per share in 2023. In other words, more than enough room to raise its annual $1.76 per share payout (4.31% forward yield).

This stock earns an “A” rating in my Dividend Grader.

Southern Copper (SCCO)

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Earlier this month, I included Southern Copper (NYSE:SCCO) on another list of high-quality dividend stocks to buy. Right now, the market is concerned that the rise in copper prices won’t last. If it falls back, the company will see a big drop in earnings, threatening its dividend.

That’s why you are able to buy SCCO stock today, at a price that gives it a very high dividend yield (6.05%). My counter? It’s possible the market is underestimating how long things will stay favorable for copper producers. Take booming demand, thanks to the rise of electric vehicles (EVs), and couple it with low supply levels, which we are seeing today.

What do you get? A good chance of copper prices staying near multi-decade highs. This would enable Southern Copper to maintain its current payout. As concerns lessen that its dividend is under threat, its share price should zoom back toward its recent high.

This stock earns an “A” rating in my Dividend Grader.

Walgreens Boots Alliance (WBA)

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In a recession-resilient industry (healthcare), Walgreens Boots Alliance (NASDAQ:WBA) appears well-positioned to weather any economic challenges ahead. But despite this, investors remain more focused on negatives with the pharmacy chain. Namely, the loss of the “boost” its business received from the vaccine rollout.

However, you can’t say the loss of this boost isn’t already factored into the price of WBA stock. Shares today trade at a discounted valuation (9x expected earnings this fiscal year). The loss of this boost also in no way threatens its current annual dividend payout of $1.91 per share (forward yield of 4.19%).

Rather, as it earns around $5 per share this fiscal year and next fiscal year, Walgreens may be in a position to raise its payout rate. It’s done so over the past seven years. In the past five years, it’s raised its dividend by an average of 5.05% per year.

This stock earns an “A” rating in my Dividend Grader.

On the date of publication, Louis Navellier held long positions in ABBV, CAG, and DRI. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.

 The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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