Playing stocks going into quarterly earnings can be a risky endeavor, especially if you’re a new investor who stands to pile into a name alongside the rest of the herd. Though it may make sense to buy a half or quarter of a position before a number and the rest after, I do think that it can make sense to punch one’s ticket as long as the valuation is depressed, quarterly expectations are relatively depressed (or at least somewhat muted), and there are catalysts that you think are discounted (or even ignored) by the rest of Wall Street.

Of course, it isn’t easy to know what’s in store until after the results land. But when it comes to neglected dividend stocks, I do think averaging into a stock ahead of time could prove wise, so as long as you’re prepared to hold or buy more shares if you’re proven wrong and earnings come in well short of what you’re expecting.

Further, if a stock market is running hot, even beating Wall Street estimates may not pave the way for a post-quarter pop. Though markets may be getting overbought after the latest run-up, the following dividend stocks seem worth stashing on the radar as they look to reveal their numbers next week.

Key Points About This Article

• Some cheap dividend stocks have a pretty good setup as they head into earnings.
• Nike and Levis could have room to recover if they’re able to deliver. Either way, shares are too cheap versus their unique slate of timely catalysts.
• If you’re looking for some stocks with huge potential, make sure to grab a free copy of our brand-new “The Next NVIDIA” report. It features a software stock we’re confident has 10X potential.
  

Nike

Lagging footwear giant Nike (NYSE:NKE) reports its numbers on October 1, 2024, and expectations seem fairly mild, as is to be expected for a firm whose shares have shed more than half of their value from peak levels.

Though last week’s CEO change announcement—John Donahoe leaving the corner office for his successor Elliott Hill—has given NKE shares a nice jolt, the coming quarterly reveal will dictate where NKE stock heads from here and perhaps set the tone for the rest of the year.

Though Nike’s turnaround will take some time (perhaps years), I do think that any notable signs of improvement could have a sizeable impact on the share price.

Many Wall Street analysts, including Barclays’ Adrienne Yih, are bullish on the legendary apparel firm’s turnaround hopes. With an innovative-driven turnaround plan (could that entail cutting-edge new kicks to come?) and a new CEO coming aboard, perhaps investors will be more forgiving of a weaker quarter as more focus shifts to the future.

In any case, the stock looks cheap here at 23.1 times trailing price-to-earnings (P/E), and, of course, there’s a nice, growing 1.71%-yielding dividend to collect while you wait for things to turn a corner.

Levi Strauss

Levi Strauss (NYSE:LEVI) has its earnings on tap for October 2, 2024. Undoubtedly, the company may succumb to similar macro pressures that have weighed down Nike. Levi wears tend to be discretionary purchases that can easily be postponed if one’s pocketbook is a bit stretched.

In any case, denim has been booming of late. And the fashionable trend could work in Levi’s favor as it wanders into a crucial quarter. Indeed, the wobbly state of the consumer may already be baked into Wall Street’s estimates.

Additionally, many may discount the company’s efforts to expand its brand into product categories beyond jeans. Ideally, Levis sees bottom-ups and tees comprising 25% of its overall sales (up 5% from 2021). Whenever pop icons like Beyoncé (who’s rumored to collaborate with Levis) influence the masses to dress like her (think fashionable jeans), you may have a catalyst that’s tough to quantify until the numbers are in.

If a Beyoncé-Levis partnership is, in fact, in the works, Levis may just be able to find a way back to its prior all-time highs (shares are still down 33% from their 2021 peak). At the end of the day, fashion trends can explode at the drop of a cowboy hat. And with that, I’m not so sure analysts are fully factoring in the potential of such a collab and the sales surge it could provide.

At 13.9 times forward P/E, with a 2.58% dividend yield, the price of admission seems way too low given its medium-term potential.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.