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5 Top High-Yield Stocks to Sail Through a Choppy March
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Traditionally, the broader stock market performed well in March. For instance, the S&P 500 gained 0.5%, on average, in March since 1928. However, the stock market is off to a discouraging start this March, with the S&P 500 closing the month’s first day of trading in the red. This came after the stock market already delivered a lackluster performance in February following strong January gains.
Wall Street, predominantly, was spooked by hotter-than-estimated inflation data at the beginning of 2023, which had led to more interest rate hike expectations. In the latter half of 2022, inflation started to gradually ease. But the consumer price index (CPI) advanced 0.5% in January and posted an annual gain of 6.4%, topping expectations of an increase of 0.4% and 6.2%, respectively, added the Labor Department.
The producer price index (PPI) also rose by 0.7% in January and increased 6% year over year, exceeding analysts’ estimates of an increase of 0.2% and 5.6%, correspondingly, per the U.S. Bureau of Labor Statistics. Additionally, the Federal Reserve’s preferred inflation index too remained stubbornly elevated, and its readings were more than anticipated.
Now, with inflation increasing at a faster-than-predicted rate, it’s highly likely that the Fed would continue hiking interest rates to quell persistent inflationary pressure. The Fed may have reduced the size of interest rate hikes from 75 basis points to 50 basis points and now 25 basis points, but the minutes from the central bank’s latest meeting showed that most of the officials remain hell-bent on more interest rate increases to curb inflation.
Regrettably, such a hawkish environment doesn’t bode well for the stock market. After all, rate hikes curb consumer outlays, push borrowing costs higher, and deter economic growth. Lest we forget, the labor market remains healthy, leading to upward pressure on prices, and chances of more rate hikes soon. The economy had added almost three times the jobs expected in January, and the unemployment rate at present is at its lowest level in more than 50 years.
Meanwhile, consumer confidence in the health of the economy dipped for the second successive month in February, which hurt the stock market as well. No doubt, high inflation, along with the looming fears of recession, dented consumers’ sentiment. The Consumer Confidence Index of the Conference Board declined to 102.9 in February from January’s reading of 106.
Given such a gloomy scenario, the stock market is undoubtedly expected to remain volatile all through March and beyond. Therefore, it’s prudent for investors to look out for steady income at the moment by investing in dividend-paying stocks. This is because such stocks are known to have sound business models that help them remain unperturbed toward market upheavals.
Regency Centers (REG - Free Report) is one of the leading publicly traded retail REITs in the United States. The company has a Zacks Rank #2. It has a dividend yield of 4.1%, while its five-year average dividend yield is also 4.1%. In the past 5-year period, REG has increased its dividend four times, and its payout has advanced nearly 2.9%. Check Regency Centers’ dividend history here.
Prudential Financial (PRU - Free Report) is a financial services leader that offers an array of financial products and services, including life insurance, annuities, retirement-related services, mutual funds, investment management, and real estate services. The company has a Zacks Rank #2. It has a dividend yield of 5%, while its five-year average dividend yield is 4.7%. In the past 5-year period, PRU has increased its dividend five times, and its payout has advanced 7.1%. Check Prudential Financial’s dividend history here.
Omnicom Group (OMC - Free Report) is one of the largest advertising, marketing, and corporate communications companies in the world. The company has a Zacks Rank #1. It has a dividend yield of 3.1%, while its five-year average dividend yield is 3.8%. In the past 5-year period, OMC has increased its dividend two times, and its payout has advanced 3.8%. Check Omnicom Group’s dividend history here.
NiSource (NI - Free Report) is an energy holding company. The company has a Zacks Rank #2. It has a dividend yield of 3.7%, while its five-year average dividend yield is 3.2%. In the past 5-year period, NI has increased its dividend two times, and its payout has advanced 4.6%. Check NiSource’s dividend history here.
NewJersey Resources (NJR - Free Report) provides safe and reliable natural gas and clean energy services, including transportation, distribution, asset management, and home services. The company has a Zacks Rank #2. It has a dividend yield of 3.1%, while its five-year average dividend yield is 3.2%. In the past 5-year period, NJR has increased its dividend five times, and its payout has advanced 7.6%. Check NewJersey Resources’ dividend history here.
By the way, Regency Centers, Prudential Financial, Omnicom, NiSource and NewJersey Resources’ expected earnings growth rates for the current year are 5.7%, 29%, 3.2%, 5.4%, and 2%, respectively.
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5 Top High-Yield Stocks to Sail Through a Choppy March
Traditionally, the broader stock market performed well in March. For instance, the S&P 500 gained 0.5%, on average, in March since 1928. However, the stock market is off to a discouraging start this March, with the S&P 500 closing the month’s first day of trading in the red. This came after the stock market already delivered a lackluster performance in February following strong January gains.
Wall Street, predominantly, was spooked by hotter-than-estimated inflation data at the beginning of 2023, which had led to more interest rate hike expectations. In the latter half of 2022, inflation started to gradually ease. But the consumer price index (CPI) advanced 0.5% in January and posted an annual gain of 6.4%, topping expectations of an increase of 0.4% and 6.2%, respectively, added the Labor Department.
The producer price index (PPI) also rose by 0.7% in January and increased 6% year over year, exceeding analysts’ estimates of an increase of 0.2% and 5.6%, correspondingly, per the U.S. Bureau of Labor Statistics. Additionally, the Federal Reserve’s preferred inflation index too remained stubbornly elevated, and its readings were more than anticipated.
Now, with inflation increasing at a faster-than-predicted rate, it’s highly likely that the Fed would continue hiking interest rates to quell persistent inflationary pressure. The Fed may have reduced the size of interest rate hikes from 75 basis points to 50 basis points and now 25 basis points, but the minutes from the central bank’s latest meeting showed that most of the officials remain hell-bent on more interest rate increases to curb inflation.
Regrettably, such a hawkish environment doesn’t bode well for the stock market. After all, rate hikes curb consumer outlays, push borrowing costs higher, and deter economic growth. Lest we forget, the labor market remains healthy, leading to upward pressure on prices, and chances of more rate hikes soon. The economy had added almost three times the jobs expected in January, and the unemployment rate at present is at its lowest level in more than 50 years.
Meanwhile, consumer confidence in the health of the economy dipped for the second successive month in February, which hurt the stock market as well. No doubt, high inflation, along with the looming fears of recession, dented consumers’ sentiment. The Consumer Confidence Index of the Conference Board declined to 102.9 in February from January’s reading of 106.
Given such a gloomy scenario, the stock market is undoubtedly expected to remain volatile all through March and beyond. Therefore, it’s prudent for investors to look out for steady income at the moment by investing in dividend-paying stocks. This is because such stocks are known to have sound business models that help them remain unperturbed toward market upheavals.
We have, thus, highlighted five such stocks that have a Zacks Rank #1 (Strong Buy) or 2 (Buy) and provide high yields. You can see the complete list of today’s Zacks #1 Rank stocks here.
Regency Centers (REG - Free Report) is one of the leading publicly traded retail REITs in the United States. The company has a Zacks Rank #2. It has a dividend yield of 4.1%, while its five-year average dividend yield is also 4.1%. In the past 5-year period, REG has increased its dividend four times, and its payout has advanced nearly 2.9%. Check Regency Centers’ dividend history here.
Prudential Financial (PRU - Free Report) is a financial services leader that offers an array of financial products and services, including life insurance, annuities, retirement-related services, mutual funds, investment management, and real estate services. The company has a Zacks Rank #2. It has a dividend yield of 5%, while its five-year average dividend yield is 4.7%. In the past 5-year period, PRU has increased its dividend five times, and its payout has advanced 7.1%. Check Prudential Financial’s dividend history here.
Omnicom Group (OMC - Free Report) is one of the largest advertising, marketing, and corporate communications companies in the world. The company has a Zacks Rank #1. It has a dividend yield of 3.1%, while its five-year average dividend yield is 3.8%. In the past 5-year period, OMC has increased its dividend two times, and its payout has advanced 3.8%. Check Omnicom Group’s dividend history here.
NiSource (NI - Free Report) is an energy holding company. The company has a Zacks Rank #2. It has a dividend yield of 3.7%, while its five-year average dividend yield is 3.2%. In the past 5-year period, NI has increased its dividend two times, and its payout has advanced 4.6%. Check NiSource’s dividend history here.
NewJersey Resources (NJR - Free Report) provides safe and reliable natural gas and clean energy services, including transportation, distribution, asset management, and home services. The company has a Zacks Rank #2. It has a dividend yield of 3.1%, while its five-year average dividend yield is 3.2%. In the past 5-year period, NJR has increased its dividend five times, and its payout has advanced 7.6%. Check NewJersey Resources’ dividend history here.
By the way, Regency Centers, Prudential Financial, Omnicom, NiSource and NewJersey Resources’ expected earnings growth rates for the current year are 5.7%, 29%, 3.2%, 5.4%, and 2%, respectively.