Investing

Time to Buy These Popular High-Dividend Yielding Stocks?

Shaun Pruitt

Published: October 2, 2023 11:50 pm

Last Updated: October 3, 2023 10:03 am

Three stocks that are able to lure investors in with their lofty dividends are Simon Property Group (SPG), Altria (MO), and OneMain Holdings (OMF).

Their steady bottom lines and dividend yields over 5% are often too compelling to overlook but let’s see if now is a good time to buy these popular stocks.

Overview & Dividend Comparison

OneMain’s dividend yield tops this list at 9.99% with the financial holding company offering personal loan products, credit cards, and optional credit insurance among other services.

Most enticing about OneMain’s dividend is the 50.39% annualized growth over the last years with seven increases during this time span.

Big tobacco producer Altria has a 9.30% dividend yield at the moment that tops real estate titan Simon Property Group’s 6.98% but both are enticingly above the S&P 500’s  1.49% average.

Altria has tapped into smokeless tobacco growing its dividend by a modest 3.84% over the last five years while Simon Property Group’s yield has decreased -4.45% as the company reserves more capital with its leasing clients of shopping, dining, and entertainment centers still regaining their post-pandemic footing.

Performance & Valuation

OneMain’s stock is up +20% this year taking the edge in performance with Simon Property Group and Altria’s stock down roughly -8% each. When including dividends, OneMain’s total return is +29% to beat the S&P 500’s +14% while easily topping Altria’s -2% and Simon Property Group’s -3%.

All three stocks could make the case for being undervalued with OneMain taking the edge here as well at a 7.1X forward earnings multiple and well below the benchmark’s 20.1X despite largely outperforming the broader market.

However, Simon Property Group and Altria trade reasonably as well at 9X forward earnings and 8.4X respectively.

Bottom Line

With the earnings outlook for Simon Property Group, Altria, and OneMain Holdings being stable for the foreseeable future these popular dividend stocks all land a Zacks Rank #3 (Hold) considering their stellar yields and attractive P/E valuations.
Simon Property Group, Inc. (SPG): Free Stock Analysis Report

Altria Group, Inc. (MO): Free Stock Analysis Report

OneMain Holdings, Inc. (OMF): Free Stock Analysis Report

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