For years, analysts and portfolio managers have anticipated the return of value stocks as the market moved higher. And for years, value stocks have continued to underperform growth stocks. However, that appears to be changing in 2022, as almost every metric from valuations to earnings for the growth arena have started to roll over.

Value stocks are typically defined as shares of a company with solid fundamentals that are priced below those of its peers, based on analysis of price-to-earnings ratio, yield and other factors. The BofA Securities Value 10 portfolio is quantitatively generated and is based on the firm’s proprietary BofA Securities versus consensus earnings surprise model plus three additional screening criteria. The universe the analysts use is the S&P 500.

We screened the Value 10 portfolio for the five stocks with the highest dividends. These top picks could be big second-half of 2022 winners. While all are rated Buy at BofA Securities, it is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Exelon

This top utility stock also makes good sense now for conservative investors. Exelon Corp. (NYSE: EXC) engages in the energy generation, delivery, and marketing businesses in the United States and Canada. It owns nuclear, fossil, wind, hydroelectric, biomass and solar generating facilities.

The company also sells electricity to wholesale and retail customers, and it sells natural gas, renewable energy and other energy-related products and services. Furthermore, it is involved in the purchase and regulated retail sale of electricity and natural gas, as well as the transmission and distribution of electricity and distribution of natural gas to retail customers.

The company also offers support services, including legal, human resources, information technology, financial, supply management, accounting, engineering, customer operations, distribution and transmission planning, asset management, system operations and power procurement services. It serves distribution utilities, municipalities, cooperatives and financial institutions, as well as commercial, industrial, governmental and residential customers.

Exelon stock investors receive a 3.12% dividend. BofA Securities has a $54 target price on the shares, and the consensus target is $49.29. The stock ended Monday’s trading at $43.89 apiece.

Hartford Financial Services

This insurance giant is a dependable idea for conservative investors, and it offers incredible value at current trading levels. Hartford Financial Services Group Inc. (NYSE: HIG) provides insurance and financial services to individual and business customers in the United States, the United Kingdom and elsewhere.

Its Commercial Lines segment offers workers’ compensation, property, automobile, liability, umbrella, bond, marine, livestock and reinsurance, as well as customized insurance products and risk management services, including professional liability, bond, surety and specialty casualty coverages through regional offices, branches, sales and policyholder service centers, independent retail agents and brokers, wholesale agents and reinsurance brokers.
The Personal Lines segment provides automobile, homeowners and personal umbrella coverage through direct-to-consumer channels and independent agents, while its Property & Casualty Other Operations segment offers coverage for asbestos and environmental exposures.

The Group Benefits segment provides group life, disability and other group coverages to members of employer groups, associations and affinity groups through direct insurance policies; reinsurance to other insurance companies; employer paid and voluntary product coverages; disability underwriting, administration and claims processing to self-funded employer plans; and a single-company leave management solution. This segment distributes its group insurance products and services through brokers, consultants, third-party administrators, trade associations and private exchanges.

The Hartford Funds segment offers investment products for retail and retirement accounts; exchange-traded products through broker-dealer organizations, independent financial advisers, defined contribution plans, financial consultants, bank trust groups and registered investment advisers; and investment management and administrative services, such as product design, implementation and oversight.

Shareholders receive a 2.34% dividend. The BofA Securities target price on Hartford Financial Services stock is $101. The consensus target is lower at $84.71, and shares closed on Monday at $65.77.

Laboratory Corp. of America

Clinical lab testing never goes out of style, and this company is a leader. Laboratory Corp. of America, Holdings (NYSE: LH) operates as an independent clinical laboratory company worldwide. It offers various tests, such as blood chemistry analyses, urinalyses, blood cell counts, thyroid tests, Pap tests, hemoglobin A1C and vitamin D products, prostate-specific antigens, tests for sexually transmitted diseases, hepatitis C tests, microbiology cultures and procedures and alcohol and other substance-abuse tests.

The company also provides specialty testing services, comprising gene-based and esoteric testing; advanced tests target specific diseases, including anatomic pathology/oncology, cardiovascular disease, coagulation, diagnostic genetics, endocrinology, infectious disease, women’s health, pharmacogenetics and parentage and donor testing; and occupational testing services, medical drug monitoring services, chronic disease programs and kidney stone prevention tests.

It also provides online and mobile applications to enable patients to check test results, as well as online applications for managed care organizations. It offers end-to-end drug development, medical device and diagnostic development solutions from early-stage research to clinical development and commercial market access.

The company serves managed care organizations, biopharmaceutical companies, physicians and other health care providers, hospitals and health systems, governmental agencies, employers, patients and consumers, contract research organizations, crop protection and chemical companies, academic institutions and independent clinical laboratories.

Shareholders receive a 1.19% dividend. The $350 BofA Securities price target is well above the $307.46 consensus target. Laboratory Corporation of America stock closed at $241.31 on Monday.

Rising interest rates are great for banks, and this is a great regional pick for investors looking to add financials to portfolios. M&T Bank Corp. (NYSE: MTB) operates as the holding company for Manufacturers and Traders Trust Company and for Wilmington Trust, National Association.

The Business Banking segment offers deposits, business loans and leases and credit cards, as well as cash management, payroll and letters of credit services to small businesses and professionals. The Commercial Banking segment provides credit and banking services for middle-market and large commercial customers. The Retail Banking segment offers demand, savings and time accounts; consumer installment loans, automobile and recreational finance loans, home equity loans and lines of credit and credit cards; mutual funds and annuities; and other services.

The Commercial Real Estate segment offers multifamily residential and commercial real estate credit and deposit services. Its Discretionary Portfolio segment provides deposits; securities, residential real estate loans and other assets; and short and long term borrowed funds, as well as foreign exchange services. The company’s Residential Mortgage Banking segment offers residential real estate loans for consumers and sells those loans in the secondary market, and it purchases servicing rights to loans originated by other entities.

M&T Bank also provides trust and wealth management, fiduciary and custodial, investment management and insurance agency services.

Investors receive a 2.88% dividend. BofA Securities has set a $210 price target, while the consensus target for M&T Bank stock is $206.12. Monday’s final trade was at $164.42 a share.

Seagate Technology

This disk drive giant is hitting on all cylinders and looks reasonable at current trading levels. Seagate Technology Holdings PLC (NASDAQ: STX) provides data storage technology and solutions in Singapore, the United States, the Netherlands and elsewhere.

The company offers hard disk and solid-state drives, including serial advanced technology attachment, serial attached SCSI and non-volatile memory express products; solid-state hybrid drives; and storage subsystems. Its products are used in enterprise servers and storage systems and edge compute and non-compute applications.

Seagate also provides an enterprise data solutions portfolio, comprising storage subsystems and mass capacity optimized private cloud storage solutions for enterprises, cloud service providers and scale-out storage servers and original equipment manufacturers. In addition, it offers external storage solutions under the Seagate Backup Plus and Expansion product lines, as well as under the LaCie and Maxtor brands in capacities up to 16 terabytes.

Shareholders enjoy a big 3.77% dividend. The Seagate Technology price objective at BofA Securities is $125. The consensus target is near $100, and the close on Monday was at $74.21.

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The stocks of these five quality blue-chip companies look poised to stand tall if the market sell-off continues, and they all come with dependable dividends. These companies are leaders in their respective sectors and offer worried investors a good place to move capital to now from higher beta names, many of which are in trouble if they report second-quarter results that disappoint.

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