The stock market has been giving investors whiplash recently. So it is no surprise many folks are looking for stability and big dividends. It is quite possible that the S&P 500 could end the year about where it is now or a touch lower. What could be difficult as we get to the second and third quarters is that we could be in store for a 20% to 25% sell-off as a year of interest rate increases finally starts to take its toll.

We will see more rate increases in March, May and likely in July. Plus we likely will see a big adjustment to earnings expectations, as many seem way too high now. Given that we could end the year essentially flat, total return may be the best way to achieve gains.

The impact total return has on portfolios is worth noting 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%: 10% for the increase in stock price and 3% for the dividends paid.

The following five stocks yielding 7% or more look like outstanding ideas for investors now, and all are rated Buy at top Wall Street firms. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Altria

This maker of tobacco products offers value investors a great entry point now as it has been hit as cigarette sales have slowed. Altria Group Inc. (NYSE: MO) is the parent company of Philip Morris USA (cigarettes), UST (smokeless), John Middleton (cigars), Ste. Michelle Wine Estates and Philip Morris Capital. PMUSA enjoys a 51% share of the U.S. cigarette market, led by its top cigarette brand Marlboro.

Altria also owns over 10% of Anheuser-Busch InBev, the world’s largest brewer, which some feel is worth more than $10 billion and may be a segment of the company that could be sold. Altria posted outstanding fourth-quarter results and also announced a shareholder-friendly $1 billion stock buyback plan.

Investors receive a 7.93% dividend. Stifel has a $50 target price on Altria stock. The consensus target is $49.65, and the shares ended Wednesday trading at $47.14.

Energy Transfer

This top master limited partnership (MLP) is a safe way for investors looking for energy exposure and income. Energy Transfer L.P. (NYSE: ET) owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with a strategic footprint in all the major domestic production basins.
Energy Transfer is a publicly traded limited partnership with core operations that include complimentary natural gas midstream, intrastate and interstate transportation and storage assets; crude oil, natural gas liquid (NGL) and refined product transportation and terminalling assets; NGL fractionation; and various acquisition and marketing assets.

After the purchase of Enable Partners in 2021, Energy Transfer owns and operates more than 114,000 miles of pipelines and related assets in all the major U.S. producing regions and markets across 41 states, further solidifying its leadership position in the midstream sector.

Through its ownership of Energy Transfer Operating (formerly known as Energy Transfer Partners), the company also owns Lake Charles LNG, as well as the general partner interests, the incentive distribution rights and 28.5 million common units of Sunoco and the general partner interests, and 39.7 million common units of USA Compression Partners.

Energy Transfer stock comes with a 9.58% distribution. Morgan Stanley has set its price target at $18. The consensus target is lower at $16.75, and shares closed on Wednesday at $9.49.

EPR Properties

This real estate investment trust (REIT) invests in some of the most popular entertainment companies and pays one of the biggest monthly dividends. EPR Properties Inc. (NYSE: EPR) is a leading experiential net lease REIT, specializing in select enduring experiential properties in the real estate industry.

The company is focused on real estate venues that create value by facilitating out-of-home leisure and recreation experiences in which consumers choose to spend their discretionary time and money. It has nearly $6.7 billion in total investments across 44 states. EPR Properties adheres to rigorous underwriting and investing criteria centered on key industry-, property- and tenant-level cash flow standards, and it believes its focused approach provides a competitive advantage and the potential for stable and attractive returns.

Shareholders receive a 7.96% distribution. The $45 Raymond James target price accompanies a Strong Buy rating. EPR Properties stock has a $44.14 consensus target, and the closing price on Wednesday was $41.96.

OneMain

While it may be off the radar of many investors, this stock offers massive total return potential. OneMain Holdings Inc. (NYSE: OMF) is a financial service holding company engaged in the consumer finance and insurance businesses in the United States.
OneMain originates, underwrites and services personal loans secured by automobiles, other titled collateral or unsecured. The company also offers credit cards and insurance products, comprising life, disability and involuntary unemployment insurance; optional noncredit insurance; guaranteed asset protection coverage as a waiver product or insurance; and membership plans.

The company posted solid fourth-quarter results that beat analysts’ expectations, and with rates trending higher, the potential for consistent net interest income seems very likely.

The dividend yield here is 9.24%. The Stephens target price of $60 is well above the $52.31 consensus target and Wednesday’s close at $43.82.

Pioneer Natural Resources

Many Wall Street analysts love this stock as a pure crude oil play, and the company also employs a variable dividend strategy. Pioneer Natural Resources Co. (NYSE: PXD) operates as an independent oil and gas exploration and production company in the United States.

The company explores for, develops and produces oil, natural gas liquids (NGLs) and natural gas. It has operations in the Midland Basin in West Texas. As of December 31, 2021, the company had proved undeveloped reserves and proved developed non-producing reserves of 130 million barrels of oil, 92 million barrels of NGLs and 462 billion cubic feet of gas, and it owned interests in 11 gas processing plants.

Pioneer production services are supported by 100 well-servicing rigs, more than 100 cased-hole, open-hole and offshore wireline units, and a range of advanced coiled tubing units.

The company is a huge player in the Permian basin and the Eagle Ford in Texas, and it owns more than 20,000 locations in the world’s second-largest oil reservoir in the Midland Basin. With a stellar balance sheet, the company is poised to remain a top player in the Permian, as it expects to deliver solid production growth going forward.

Investors receive a 12.17% dividend, but remember that it may vary from quarter to quarter. The Goldman Sachs analyst has a $263 target price. The consensus target is higher at $272.35. On Wednesday, the final Pioneer Natural Resources stock trade was for $205.27.

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Shares of these five top companies for a variety of reasons are trading incredibly cheap and offering investors very timely entry points. Still, it may be very prudent to start with buying partial positions, as the market still has plenty of issues to deal with, not the least of which is the ongoing inflation burden and a continued rise in interest rates.

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