Investing

Jim Cramer Says 4 Large Cap Dividend Stocks Are Sizzling December Buys

Lee Jackson

Published: December 6, 2024 10:18 am

Last Updated: December 6, 2024 2:04 pm

Key Points

• Many top Wall Street pundits are putting out some end-of-the-year buy lists.
• CNBC’s Jim Cramer’s 40-year career on Wall Street is still going strong.
• Cramer points out November winners often carry the strength through December.
• Is it time for you to get a 2024 portfolio review? After massive gains over the past two years, getting an opinion of a qualified financial advisor makes sense. Click here to get started finding one. (sponsored)

Since 1926, dividends have contributed approximately 32% of the total return for the S&P 500, while capital appreciations have contributed 68%. Therefore, sustainable dividend income and capital appreciation potential are essential for total return expectations.

A study from Hartford Funds, in collaboration with Ned Davis Research, found that dividend stocks delivered an annualized return of 9.18% over the past half-century (1973-2023). Over the same timeline, this was more than double the annualized return for non-payers (3.95%).

We have covered Jim Cramer for almost 20 years here at 24/7 Wall St., and like all opinionated Wall Street stock pickers, he had had more than his fair share of home runs and some swings and misses. With a career that started at Goldman Sachs and led to the formation of his hedge fund, Cramer Berkowitz, the founding of The Street, which he wrote for from 1996 to 2021, and his popular Mad Money show, Cramer has something in his pocket that many on Wall Street don’t have: access to almost everybody, everywhere, regardless of their Wall Street status.

He recently highlighted 10 stocks he felt had solid potential in December. He cited a Wall Street axiom that stocks with strong November performance often see a follow-through in December. We screened the Cramer picks, and four dividend payers look intriguing now. All have buy ratings at top Wall Street firms that we cover.

EQT

This natural gas giant is the ultimate Donald Trump energy trade. It offers a 1.41% dividend and solid total return potential. EQT Corp. (NYSE: EQT) is a natural gas production company in the United States.

The company sells natural gas and natural gas liquids to marketers, utilities, and industrial customers through pipelines located in the Appalachian Basin. It also offers marketing services and contractual pipeline capacity management services.

EQT recently signed a major joint venture deal with Blackstone Credit and Insurance (BXCI), a unit of Blackstone. The agreement includes EQT interests in key infrastructure assets such as the Mountain Valley Pipeline (MVP), transmission and storage facilities, and the Hammerhead Pipeline. BXCI will provide $3.5 billion in cash for a non-controlling equity stake, valuing the JV at $8.8 billion.

Morgan Stanley has an Overweight rating on the shares and recently raised its $45 target price to $56.

McKesson

This medical and health care products company is a titan in the industry, and deregulation could benefit the shares, which pay a small, o.50% dividend. McKesson Corp. (NYSE: MCK) provides health care services in the United States and internationally.

It operates through four segments:

• U.S. Pharmaceutical
• Prescription Technology Solutions (RxTS)
• Medical-Surgical Solutions
• International

The U.S. Pharmaceutical segment distributes these drug products:

• Branded
• Generic
• Specialty
• Biosimilar
• Over-the-counter pharmaceutical drugs
• Healthcare-related products

This segment also offers practice management, technology, clinical support, and business solutions to community-based oncology and other specialty practices, consulting, outsourcing, technological, and other services, and selling financial, operational, and clinical solutions to pharmacies.

The RxTS segment serves:

• Biopharma and life sciences partners and patients to address medication challenges for patients by working across health care
• Connects patients, pharmacies, providers, pharmacy benefit managers, health plans, and biopharma companies to deliver innovative solutions to help people get the medicine needed to live healthier lives
• Provides prescription price transparency, benefit insight, dispensing support, third-party logistics, and wholesale distribution support services

The Medical-Surgical Solutions segment offers medical-surgical supply distribution, logistics, and other services to health care providers, including physician offices, surgery centers, nursing homes, hospital reference labs, and home health care agencies.

The International segment provides distribution and services to wholesale, institutional, and retail customers in Europe and Canada.

Citigroup has a Buy rating with a giant $713 target price objective.

Tapestry

While the company recently had an aborted merger attempt with Capri, the stock has been strong due to a recently announced $2 billion stock buyback. Paying a solid 2.2% dividend, this company could be the ultimate holiday idea. Tapestry Inc. (NYSE: TPR) provides luxury accessories and branded lifestyle products in North America, Greater China, the rest of Asia, and internationally.

The company operates in three segments:

• Coach
• Kate Spade
• Stuart Weitzman

It offers:

• Women’s handbags and accessories, such as small leather goods, including mini and micro handbags, money pieces, wristlets, pouches, and cosmetic cases
• Novelty accessories include address books, time management and travel accessories, sketchbooks, portfolios, belts, key rings, and charms

The company also provides men’s products, including:

• Bag collections, such as business cases, computer bags, messenger-style bags, backpacks, and totes; small leather goods
• Wallets, card cases, travel organizers, belts, footwear, watches, fragrances, sunglasses, novelty accessories, and ready-to-wear items

In addition, it offers other products:

• Women’s footwear and fragrances
• Eyewear and sunglasses
• Jewelry, such as bracelets, necklaces, rings, and earrings
• Watches
• Women’s seasonal lifestyle apparel collections, including outerwear, ready-to-wear, and cold-weather accessories, such as gloves, scarves, and hats

Further, the company provides kids’ items, housewares, and home accessories, such as fashion bedding and tableware, stationery, and gifts.

Tapestry offers its products through retail and outlet stores, brand e-commerce sites, concession shop-in-shops, wholesale, and third-party distributors under the Coach, Kate Spade, and Stuart Weitzman brand names.

Wells Fargo has an overweight rating with a big $75 price target.

Vistra

With data centers increasing the electricity demand, this stock has been a big winner and pays a 0.55% dividend. Vistra Corp. (NYSE: VST) and its subsidiaries operate as an integrated retail electricity and power generation company.

The company operates through six segments:

• Retail
• Texas
• East
• West
• Sunset
• Asset Closure

Vistra retails electricity and natural gas to residential, commercial, and industrial customers across the United States, including the District of Columbia. In addition, the company is involved in electricity generation, wholesale energy purchases and sales, commodity risk management, fuel production, and fuel logistics management activities.

It serves approximately 5 million customers and has a generation capacity of approximately 41,000 megawatts. Its portfolio includes natural gas, nuclear, coal, solar, and battery energy storage facilities.

Morgan Stanley has an Overweight rating and a $169 target for the shares.

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