Investors always look for solid dividend-paying stocks to add stability to their portfolios, especially during times of market volatility. One such stock recommended by Wall Street analysts is IBM (IBM). Despite announcing mixed first-quarter results, IBM remains an attractive dividend pick. The company exceeded earnings expectations while falling short on revenue estimates, mainly due to the uncertain macro environment. Along with this, IBM made a significant acquisition of cloud software maker HashiCorp valued at $6.4 billion. Despite these developments, IBM paid dividends of $1.5 billion in the first quarter and generated free cash flow of $1.9 billion. The company is optimistic about delivering a free cash flow of around $12 billion for the full year. With a dividend yield of about 4%, IBM is considered a solid choice for income-seeking investors.
Toymaker Hasbro (HAS)
Another dividend stock worth considering is Hasbro (HAS), a leading toymaker that recently reported better-than-expected first-quarter earnings. The company paid dividends totaling $97.2 million in the first quarter of 2024, offering an attractive dividend yield of 4.7%. Following a positive outlook from meetings with Hasbro’s management at JPMorgan’s 52nd Annual TMC Conference, JPM analyst Christopher Horvers upgraded the stock to buy from hold. Horvers increased the price target to $74 from $61, citing higher estimates compared to consensus forecasts. He highlighted Hasbro’s cost efficiency efforts and digital gaming prospects, expected to boost the company’s performance in the second half of 2024 and the first half of 2025. Moreover, Horvers expressed optimism about the industry experiencing improved growth in 2024, driven by recovery in low ticket and short replacement cycle product categories.
Big-Box Retailer Target (TGT)
Lastly, Target (TGT) is a dividend stock that investors should consider adding to their portfolio. In the first quarter of 2024, Target paid $508 million in dividends to shareholders, offering a dividend yield of 2.8%. Despite slightly missing analysts’ earnings per share expectations in the first quarter, Baird analyst Peter Benedict remains positive about the company’s future prospects. Benedict believes that the post-earnings selloff in TGT stock was unjustified, considering the company’s strategic focus on value and affordability through low pricing. He also noted that Target’s inventory remains in good shape, emphasizing management’s aim to restore positive comparable sales growth in the fiscal second quarter. Overall, Benedict finds the risk/reward profile of TGT stock compelling and reiterated a buy rating with a price target of $190.
Investors seeking stable income and potential upside in the stock market should consider these top dividend stocks recommended by Wall Street analysts. IBM, Hasbro, and Target offer attractive dividend yields and growth prospects, making them suitable additions to a diversified portfolio. By following the recommendations of seasoned analysts and conducting thorough research, investors can make informed decisions to achieve their financial goals. Remember to evaluate your risk tolerance and investment objectives before adding any stocks to your portfolio.