After years of a low interest rate environment, many investors have turned to equities, not only for the growth potential but also for solid and dependable dividends that help to provide an income stream. What this equates to is total return, which is one of the most powerful investment strategies going. While interest rates are rising, these companies still make sense for investors looking for solid growth and income potential.

We like to remind readers about the impact total return has on portfolios because it is one of the best ways to help improve the chances for overall investing success. Again, total return is the combined increase in a stock’s value plus dividends. For instance, if you buy a stock at $20 that pays a 3% dividend, and it goes up to $22 in a year, your total return is 13%. That is, 10% for the increase in stock price and 3% for the dividends paid.

Five top large-cap companies are expected to raise their dividends this week, so we screened our 24/7 Wall St. research universe and found that all are Wall Street favorites and rated Buy at some of the top firms.

While it is always possible that not all of them do indeed raise their dividends, top analysts expect them to, and generally the data is based on past increases in the firm’s dividend payouts. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Baxter International

This is a strong health care play, especially with hospitals and doctors returning to non-COVID-19-related procedures in a big way. Baxter International Inc. (NYSE: BAX) provides a portfolio of renal and hospital products.

Its Renal segment provides products and services to treat end-stage renal disease, irreversible kidney failure and acute kidney therapies. This segment offers a comprehensive portfolio to meet the needs of patients across the treatment continuum, including technologies and therapies for peritoneal dialysis, in-center hemodialysis (HD), home HD, continuous renal replacement therapy and additional dialysis services.

The Hospital Products segment manufactures intravenous (IV) solutions and administration sets, premixed drugs and drug-reconstitution systems, pre-filled vials and syringes for injectable drugs, IV nutrition products, infusion pumps, inhalation anesthetics and biosurgery products. This segment also provides products and services related to pharmacy compounding, drug formulation and packaging technologies.

Shareholders currently receive a 1.58% dividend. The company is expected to raise its $0.28 per share dividend to $0.32. Morgan Stanley has a Wall Street high $105 target price on Baxter International stock. The consensus target is $94.00, and the shares closed on Friday at $71.06.

This is a very safe energy stock for worried investors who feel the market may have a serious downdraft. Chesapeake Energy Corp. (NYSE: CHK) an independent exploration and production company focused on oil, natural gas and natural gas liquids (NGLs) from underground reservoirs in the United States.

The company holds interests in natural gas resource plays in the Marcellus Shale in the northern Appalachian Basin in Pennsylvania and the Haynesville/Bossier Shales in northwestern Louisiana, as well as the liquids-rich resource play in the Eagle Ford Shale in South Texas.

As of December 31, 2021, it owned interests in approximately 8,200 gross productive wells, including 6,500 wells with working interest and 1,700 wells with an overriding or royalty interest, and it had estimated proved reserves of 661 million barrels of oil equivalents.

Chesapeake Energy stock comes with a 3.42% dividend, which is expected to be lifted to $0.55 a share from $0.48. Wolfe Research’s $111 price target is less than the $117.67 consensus target. The stock closed Friday’s trading session at $82.02.

Devon Energy

This stock may be offering one of the best value propositions among the Goldman Sachs picks and is utilizing the variable dividend strategy. Devon Energy Corp. (NYSE: DVN) is an independent energy company that primarily engages in the exploration, development and production of oil, natural gas and NGLs in the United States and Canada. It operates approximately 19,000 wells.

The company also offers midstream energy services, including gathering, transmission, processing, fractionation and marketing to producers of natural gas, NGLs, crude oil and condensate through its natural gas pipelines, plants and treatment facilities.

Production is weighted toward crude oil while growth opportunities are liquids focused, anchored by the Delaware Basin, SCOOP/STACK, Eagle Ford Shale, Canadian Oil Sands, and the Barnett. Devon also owns equity in the publicly traded midstream master limited partnership EnLink.

Devon Energy now pays investors a 6.88% dividend. That dividend is expected to rise to $1.15 a share from $1.00. Truist Financial has set a Wall Street high $91 target price, while the consensus target on Devon Energy stock is $74.79. Friday’s closing print was $58.17.

Diamondback Energy

This red-hot energy play has had a big run but looks poised to press even higher. Diamondback Energy Inc. (NASDAQ: FANG) is an independent oil and natural gas company focused on the acquisition, development, exploration and exploitation of unconventional and onshore oil and natural gas reserves in the Permian Basin in West Texas and New Mexico.
The company primarily focuses on the development of the Spraberry and Wolfcamp formations of the Midland basin, as well as the Wolfcamp and Bone Spring formations of the Delaware basin, which are part of the Permian Basin.

Diamondback Energy holds working interests in 4,326 gross producing wells, as well as royalty interests in 4,553 additional wells. In addition, the company owns mineral interests approximately 787,264 gross acres and 24,350 net royalty acres in the Permian Basin and Eagle Ford Shale, and it owns, operates, develops and acquires midstream infrastructure assets, including 927 miles of crude oil gathering pipelines, natural gas gathering pipelines and an integrated water system in the Midland and Delaware Basins of the Permian Basin.

Shareholders receive a 1.85% dividend. The dividend is expected to rise by a dime per share to $0.70. The $200 Raymond James price target is well above the $176.86 consensus target. Diamondback Energy stock ended Friday at $126.23 a share.

Packaging Corp. of America

This company should continue to do well, especially if the economy does not totally bog down. Packaging Corporation of America (NYSE: PKG) manufactures and sells containerboard and corrugated packaging products in the United States.

The Packaging segment offers various containerboard and corrugated packaging products, such as conventional shipping containers used to protect and transport manufactured goods, multicolor boxes and displays that help to merchandise the packaged product in retail locations and honeycomb protective packaging products, as well as packaging for meat, fresh fruit and vegetables, processed food, beverages and other industrial and consumer products. This segment sells its corrugated products through a direct sales and marketing organization, independent brokers and distribution partners.

The Paper segment manufactures and sells commodity and specialty papers, as well as communication papers, including cut-size office papers and printing and converting papers. This segment sells white papers through its sales and marketing organization.

Shareholders currently receive a 2.47% dividend. The company is expected to lift the dividend to $1.20 from $1.00. The Packaging Corporation of America stock price target at Truist Financial is $182. The consensus target of $167.40 is closer to Friday’s close at $161.17.

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These five top blue-chip companies with stocks rated Buy across Wall Street are expected to lift the dividends they pay to shareholders. Not only is increasing dividends and returning capital to investors important, but it also shows that the company is doing well and has the earnings and cash flow strength to increase the payouts.

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