Investing

7 Dividend Stocks To Buy For the Coming Bear Market

Lee Jackson

Published: November 17, 2023 10:06 am

2023 has been a much better year than 2022, as all major indices are higher. The tech-heavy Nasdaq is up a whopping 32.5%, while the venerable S&P 500 is up 15.36% and the Dow Jones Industrial just 3.5%, but it hasn’t felt like a bull market, at least not yet.

While the inflation numbers for October all came in below estimates, the year-over-year consumer price index was still up 3.2%, and the core number, which strips out the volatile food and energy components, climbed 4% over last year. While the stock market rallied huge on the results, prices still increased.

The American consumer is still being struck with significant price increases, and if, for any reason, inflation starts to tick higher in November and again in December, all of the hopes that interest rate increases are over may very well evaporate.

If Federal Reserve Chairman Jay Powell sees prices rising again, he has already stated they are ready to increase rates again, and maybe more than once, which could usher in a nasty bear market.

If that scenario continues, we found seven dividend stocks investors should buy now; all are rated ‘Strong Buy’ across Wall Street.

Bank of America

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The company posted solid third-quarter results, and banks welcome interest rate increases. Bank of America Corporation (NYSE: BAC) is a ubiquitous presence in the United States, providing various banking and financial products and services for:

• Individual consumers,
• Small and middle market businesses,
• Institutional investors,
• Corporations
• Governments in the United States and internationally are operating 5,100 banking centers, 16,300 ATMs, call centers, and online and mobile banking platforms.

Bank of America has expanded into many new US markets, with scale globally positioning them ideally to benefit from accelerating loan growth over the next two years.

Unlike smaller peers, scale allows the bank to substantially increase investment over the next few years without notably jeopardizing returns, driving further market share gains and paying investors a stellar 3.47% dividend.

Bristol-Myers Squibb

Bristol-Myers Squibb (CC BY-SA 2.0) by A 4

This top company remains a solid pharmaceutical stock to own long-term, offering an outstanding entry point and a massive 4.55% dividend. Bristol-Myers Squibb Company (NYSE: BMY) discovers, develops, licenses, manufactures, and markets pharmaceutical products worldwide.

The company offers products in:

• Hematology,
• Oncology,
• Cardiovascular
• immunology therapeutic classes

The company’s products include:

• Revlimid is an oral immunomodulatory drug for the treatment of multiple myeloma.
• Opdivo for anti-cancer indications.
• Eliquis, an oral inhibitor indicated for the reduction in risk of stroke/systemic embolism in NVAF and for the treatment of DVT/PE.
• Orencia for adult patients with active RA and psoriatic arthritis, as well as reducing signs and symptoms in pediatric patients with active polyarticular juvenile idiopathic arthritis.

The company also provides:

• Sprycel for the treatment of Philadelphia chromosome-positive chronic myeloid leukemia.
• Yervoy for the treatment of patients with unresectable or metastatic melanoma.
• Abraxane, a protein-bound chemotherapy product; mpliciti for treating multiple myeloma.
• Reblozyl for the therapy of anemia in adult patients with beta-thalassemia.

Cardinal Health

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This is an excellent way to play the healthcare sector for more conservative growth and income investors, and the company pays a 1.91% dividend. Cardinal Health, Inc. (NYSE: CAH) is one of the largest drug and medical product distributors.

The company generates approximately two-thirds of its profit from the pharmaceutical business and nearly one-third from its medical business.

The pharmaceutical distribution business supports:

• Retail
• Mail
• Hospital
• Physician clients
• Drug manufacturers

The medical business manufactures its portfolio of medical products and distributes brand-name products to hospitals and physicians.

Kraft Heinz

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Even in bad times, everybody has to eat, and this company always stands to benefit while paying a massive 4.81% dividend. The Kraft Heinz Company (NYSE: KHC) was formed via the merger of H.J. Heinz Company and Kraft Foods Group.

The company is a leading global food company with $25 billion of estimated annual revenues generated by well-known brands such as Kraft, Heinz, Oscar Meyer, and Maxwell House.

Kraft Heinz is the third largest food and beverage manufacturer in North America and derives 76% of revenues from that market and 24% from International.

The Company’s additional brands include:

• ABC
• Capri Sun
• Classico
• Jell-O
• Kool-Aid
• Lunchables
• Ore-Ida
• Oscar Mayer
• Philadelphia
• Planters
• Plasmon
• Quero
• Weight Watchers
• Smart Ones
• Velveeta

Warren Buffett holds a massive position in Berkshire Hathaway of 325 million shares.

McDonald’s

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The legacy fast-food heavyweight is a solid pick when the economy goes south and pays a solid 2.48% dividend. McDonald’s Corporation (NYSE: MCD) operates and franchises McDonald’s restaurants in the United States and internationally.

The company’s restaurants offer:

• Hamburgers and cheeseburgers
• Chicken sandwiches and nuggets
• Wraps
• Fries
• Salads
• Oatmeal
• Shakes
• Desserts
• Sundaes
• Soft serve cones
• Bakery items,
• Soft drinks,
• Coffee and other beverages

The company operates a stunning 40,275 McDonald’s locations worldwide as of early 2023. Globally, McDonald’s serves over 69 million people daily. McDonald’s operates in 118 countries and territories.

PepsiCo

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This top consumer staples stock will supply the goods for football tailgates and parties and pay a rich 2.90% dividend. PepsiCo, Inc. (NYSE: PEP) is a worldwide food and beverage company.

Its Frito-Lay North America segment offers:

• Lays and Ruffles potato chips
• Doritos
• Tostitos and Santitas tortilla chips
• Cheetos cheese-flavored snacks
• Branded dips
• Fritos corn chips

The company’s Quaker Foods North America segment provides:

• Quaker oatmeal
• Grits
• Rice cakes,
• Natural granola and oat squares
• Pearl Milling mixes and syrups
• Quaker Chewy granola bars
• Cap’n Crunch cereal
• Life cereal
• Rice-A-Roni side dishes

Pepsico’s North American beverages segment offers:

• Beverage concentrates
• Fountain syrups
• Pepsi
• Gatorade
• Mountain Dew
• Diet Pepsi
• Aquafina
• Diet Mountain Dew
• Tropicana Pure Premium
• Sierra Mist and Mug brands
• Ready-to-drink tea, coffee, and juices

Walmart

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The giant retailer is a top idea for investors looking for retail winners during difficult times and pays a 1.36% dividend.

Walmart Inc. (NYSE: WMT) is the world’s largest retailer, operating retail stores under the formats of:

• Walmart Stores
• Supercenters
• Neighborhood Markets
• Sam’s Club locations in the United States
• Growing e-commerce business (including Jet.com)

Internationally, Wal-Mart also operates locations in several countries, including Argentina, Brazil, Canada, China, Japan, Mexico, and the United Kingdom.

Nearly 260 million customers and members visit the company’s 10,623 stores per week under 72 banners and e-commerce websites in 19 countries. Walmart employs a stunning 2.1 million associates worldwide, with 1.6 million in the United States.