Incredibly, 2022 is almost a third of the way over. For many investors, it has been a year to forget. While we have bounced nicely off the lows printed in late February and early March, the reality is we are facing the potential for some of the worst economic times in decades. Rising interest rates, the hottest inflation readings since the early 1980s, a bitter struggle between Ukraine and Russia, ongoing COVID-19 restrictions and a host of other issues have kept a lid on stock prices that may continue to for months.
Some of the best stock ideas for concerned investors can be found on the BofA High Quality and Dividend Yield screen, where the firm’s analysts have identified high-quality stocks with secure, above-market dividend yields aligned with the BofA Global Research analysts’ fundamental outlook.
We screened the list looking for Buy-rated stocks that not only come with solid and dependable dividends but also offer a reasonably safe place for investors to move capital to in today’s less than bullish environment. The following five stocks make the cut, and all make sense for conservative growth and income investors. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
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Emerson Electric
This Dividend Aristocrat stock has raised its payout year for over 25 years and is offering a stellar entry point. Emerson Electric Co. (NYSE: EMR | EMR Price Prediction) is a global technology and engineering company providing innovative solutions for customers in industrial, commercial and residential markets.
The company’s Automation Solutions business helps process, hybrid and discrete manufacturers maximize production, protect personnel and the environment while optimizing their energy and operating costs. The Commercial & Residential Solutions business helps ensure human comfort and health, protect food quality and safety, advance energy efficiency and create a sustainable infrastructure.
Shareholders receive a 2.21% dividend. BofA Securities has a $125 price target on Emerson Electric stock. The consensus target is $110.67, and shares closed on Wednesday at $93.31.
General Dynamics
Like other major defense contractors, this submarine and tank builder looks poised to deliver solid numbers and guidance the rest of this year and perhaps beyond. General Dynamics Corp. (NYSE: GD) is engaged in business aviation, land and expeditionary combat vehicles and systems, armaments, munitions, shipbuilding and marine systems, and information systems and technologies.
Major products include Virginia-class nuclear-powered submarine and Ohio class replacement, Arleigh Burke-class Aegis, Abrams M1A2 tank, Stryker eight-wheeled assault vehicle, medium-caliber munitions and gun systems, tactical and strategic mission systems.
General Dynamics stock investors receive a 2.07% dividend. The BofA Securities price target is $280, while the consensus target is $268. The last trade for Wednesday was reported at $243.71.
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Norfolk Southern
This top transport looks like a solid pick for the second quarter and all of 2022. Norfolk Southern Corp. (NYSE: NSC), together with its subsidiaries, engages in the rail transportation of raw materials, intermediate products and finished goods.
The company also transports overseas freight through various Atlantic and Gulf Coast ports, provides logistics services and operates scheduled passenger trains. In addition, the company engages in the acquisition, leasing and management of coal, oil, gas and minerals; development of commercial real estate and telecommunications; and leasing or sale of rail property and equipment.
Shareholders receive a 1.94% dividend. The $291 BofA Securities price objective is less than the $306.96 consensus target. Norfolk Southern stock closed on Wednesday at $260.93.
Quest Diagnostics
With an aging population, this may be an even safer way for investors to play health care. Quest Diagnostics Inc. (NYSE: DGX) is the largest provider of clinical diagnostic testing and related services in the United States and also provides its services internationally.
The company’s diagnostic information services include routine testing, non-routine and advanced clinical testing, anatomic pathology testing and other diagnostic information services. It offers diagnostic information services primarily under the Quest Diagnostics brand, as well as under the AmeriPath, Dermpath Diagnostics, ExamOne and Quanum brands to patients, clinicians, hospitals, independent delivery networks, health plans, employers, direct contract entities and accountable care organizations through a network of laboratories, patient service centers, phlebotomists in physician offices, call centers and mobile paramedics, nurses and other health and wellness professionals.
Quest Diagnostics also provides risk assessment services for the life insurance industry, as well as health care organizations and clinicians robust information technology solutions.
Investors receive a 1.92% dividend. The BofA Securities target of $166 compares to the $150.64 consensus target for Quest Diagnostics stock. The shares were last seen trading at $137.05 on Wednesday.
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Texas Instruments
This old-school legacy semiconductor company offers solid value at current levels and is a great pick for more conservative investors looking for a technology idea. Texas Instruments Inc. (NASDAQ: TXN) is a broad-based supplier of semiconductor components, ranging from digital signal processors to high-performance analog components, to digital light-processing technology and calculators.
Some 65% of the company’s sales are exposed to the well-diversified, business-to-business industrial, automotive, communications infrastructure and enterprise markets. While business from those sectors, especially automotive, could suffer in the near term, the analyst feels the solid dividend should support the shares. The company is also a big Apple supplier, so the long-term outlook for this venerable leader makes it a safer bet for investors with less risk tolerance.
Investors receive a 2.66% dividend. Texas Instruments stock has a $200 price target at BofA Securities. The consensus target is $197.57, and Wednesday’s closing share price was $175.11.
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These five top companies in various sectors offer investors the potential for reasonable upside that is supported by dividends that have been paid consistently for years. All these blue-chip leaders make sense for growth and income investors looking to stay invested during these turbulent times.
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