January cannot be over soon enough for most investors, as the stock market has struggled through the worst month since March of 2020. After last week’s meeting of the Federal Reserve, any ambiguity about the direction and timing of interest rates came to an end, as Fed Chair Jay Powell indicated that the liftoff for rate increases will begin in March. Depending on who you ask, it will be the first increase of likely four during the rest of the year, and possibly six, and they will range in size from 0.25 to 0.50 basis points.

Inflation on an overall basis is at the highest level in almost 40 years. Despite assurances from the Treasury Secretary, the Federal Reserve and others that this onslaught of higher prices will cool at some point this year, with prices skyrocketing on every level, those in Washington are starting to feel the heat from their constituents back home. The time to act has long been passed, so the pressure is on policymakers at the Fed.

With market volatility skyrocketing in January, we screened the BofA Securities research universe looking for the stocks not only paying the highest secure dividends but also Buy rated at the firm. We also screened for companies that likely will feel less pressure from an increase in the federal funds rate.

It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Coca-Cola

This remains a top Buffet holding, as he owns a huge 400 million shares. Coca-Cola Co. (NYSE: KO) is the world’s largest beverage company, refreshing consumers with more than 500 sparkling and still brands.

Led by Coca-Cola, one of the world’s most valuable brands, the company’s portfolio features 20 billion-dollar brands including Diet Coke, Fanta, Sprite, Coca-Cola Zero, vitaminwater, Powerade, Minute Maid, Simply, Georgia and Del Valle. Globally, it is the number one provider of sparkling beverages, ready-to-drink coffees and juices and juice drinks.

Through the world’s largest beverage distribution system, consumers in more than 200 countries enjoy Coca-Cola beverages at a rate of more than 1.9 billion servings a day. Also remember that the company also owns 16.7% of Monster Beverage, which continues to deliver big numbers.

Investors receive a 2.76% dividend. The BofA Securities price target is $64, while the analysts’ consensus target is $63.84. Coca-Cola stock closed on Friday at $60.84 a share.

Many of the Wall Street firms that we cover are still very positive on utilities, and this company is highly rated. Dominion Energy Inc. (NYSE: D) is an American power and energy company that operates through the following four segments:

• The Dominion Energy Virginia segment generates, transmits and distributes regulated electricity to residential, commercial, industrial and governmental customers in Virginia and North Carolina.
• The Gas Distribution segment engages in the regulated natural gas gathering, transportation, distribution and sales activities, as well as distributes nonregulated renewable natural gas. This segment serves residential, commercial and industrial customers.
• The Dominion Energy South Carolina segment generates, transmits and distributes electricity and natural gas to residential, commercial and industrial customers in South Carolina.
• And the Contracted Assets segment is involved in the energy marketing and price risk activities.

Dominion Energy’s portfolio of assets included approximately 30.2 gigawatts of electric generating capacity; 10,500 miles of electric transmission lines; 85,600 miles of electric distribution lines; and 94,200 miles of gas distribution lines. It serves approximately 7 million customers. The company sells electricity at wholesale prices to rural electric cooperatives and municipalities, as well as into wholesale electricity markets.

Shareholders receive a 3.21% dividend. BofA Securities has an $88 target price for Dominion Energy stock. The $86.28 consensus target is slightly closer to Friday’s close at $79.46.

Essex Property Trust

This is an outstanding way for investors looking to add a real estate position to growth and income portfolios. Essex Property Trust Inc. (NYSE: ESS) is a fully integrated real estate investment trust (REIT) that acquires, develops, redevelops and manages apartment communities located primarily in the southern and northern California markets and Seattle. As of the fourth quarter 2020, Essex had ownership interests in 250 apartment communities, with an additional six properties in various stages of active development.

Essex Property Trust was able to grow earnings-per-share by 30% in the past 12 months. While the share price gain of 38% has outpaced the earnings growth. It seems to indicate that Wall Street is now more optimistic about the stock. Essex raised its dividend 0.6% for the upcoming April 15 payment date, giving the trust 27 consecutive years of dividend growth. The dividend has a compound annual growth rate of 7.2% since 2011.

Shareholders receive a 2.52% dividend. The $396 BofA Securities price target is well above the $370.36 consensus target for Essex Property Trust stock. Friday’s closing price of $332.14 was up almost 4% for the day.

The company offers a very solid dividend, which was raised by four cents per share to $0.79 last year and should be raised again soon. Procter & Gamble Co. (NYSE: PG) is one of the world’s largest consumer products companies. Its many brands include Pampers, Tide, Bounty, Charmin, Gillette, Oral B, Crest, Olay, Pantene, Head & Shoulders, Ariel, Gain, Always, Tampax, Downy and Dawn. Some of these are among the most valuable brands in the world.

The company sells its products through mass merchandisers, e-commerce, grocery stores, membership club stores, drug stores, department stores, distributors, wholesalers, baby stores, specialty beauty stores, high-frequency stores and pharmacies. The company has been very innovative in its product development process and uses that to help ensure future growth and cash flow. This should provide investors years of steady growth and dividends.

Shareholders receive a 2.17% dividend. The BofA Securities price objective for Procter & Gamble stock is $180. the consensus target is $166.26, and shares closed at $160.50 on Friday.

Truist Financial

This more off-the-radar pick makes great sense for investors looking for a solid regional winner. Truist Financial Corp. (NYSE: TFC) is a bank holding company, incorporated in North Carolina and headquartered in Charlotte. The company was formerly known as BB&T, but it changed its name in December 2019 upon the acquisition of SunTrust Banks.

The complete transition to the Truist brand is expected to take about two years. Until then, customers of both BB&T and SunTrust will be served through their respective bank branches using the same apps, websites and services as before the merger closed. As part of the regulatory approval process, the new company will sell off 30 SunTrust branches in North Carolina, Virginia and Georgia to First Horizon Bank and divest $2.4 billion in deposits to “mitigate the competitive effects of the merger,” according to the Federal Reserve.

Truist’s footprint is located in one of the strongest and fastest-growing regions of the United States, and the analysts expect the company to maintain a competitive advantage over many of its competitors headquartered outside its footprint due to its being physically located in the southeast part of the country.

Investors in Truist Financial stock receive a 3.07% dividend. BofA Securities has set a $76 target. The consensus figure is $70.68, and shares ended last week at $62.58.

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While investors are probably salivating after Friday’s solid market moves, the reality is the stock market remains extremely pricey and stocks are trading at some of the highest multiples in years. For growth and income investors who are more conservative, moving to these secure dividend companies now makes sense.

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