Investors looking for stable dividend-paying stocks in the energy sector should consider Chord Energy (CHRD). This oil and gas operator in the Williston Basin has declared a base-plus-variable cash dividend of $3.25 per share. Analysts at Siebert Williams Shank have initiated coverage of CHRD with a buy rating and a price target of $262, citing its attractive valuation and capital returns. The company’s peer-leading capital returns framework aims to return more than 75% of free cash flow (FCF) to shareholders through dividends and opportunistic buybacks. With estimated capital returns of $778.8 million and $1.15 billion in 2024 and 2025, respectively, CHRD offers above-peer-average capital return yields of 6.6% and 9.7%. This indicates the potential for strong returns for investors.
Energy Transfer (ET): A Reliable Master Limited Partnership
Energy Transfer (ET) is a midstream energy company with over 125,000 miles of pipeline and related infrastructure. The company recently announced a 3.3% year-over-year increase in its quarterly cash distribution to $0.3175 per common unit for the first quarter of 2024, reflecting an impressive dividend yield of about 8% annually. Mizuho analyst Gabriel Moreen has raised the price target for ET to $19 from $18 and reiterated a buy rating, making it their top midstream pick. Despite solid free cash flow outlook and leverage in the Permian basin, ET still has room for improvement. Moreen believes that a clear capital allocation framework could be a significant catalyst for the company, enhancing its free cash flow yield. With discounted valuation and strong equity return potential, ET stands out as a reliable dividend pick in the energy sector.
Coca-Cola (KO): A Dividend King with Consistent Growth
Coca-Cola (KO) is a dividend king with a track record of consistently increasing its quarterly dividend, as evidenced by its 62nd consecutive dividend hike earlier this year. The beverage giant raised its dividend by about 5.4% to $0.485 per share, offering investors a dividend yield of 3.1%. Despite expecting higher impacts of currency headwinds, Coca-Cola reported better-than-expected first-quarter results and raised its organic revenue growth forecast. RBC Capital analyst Nik Modi reiterated a buy rating on KO stock with a price target of $65, emphasizing the company’s robust underlying fundamentals and potential for revenue and earnings growth. With a strong international presence, Coca-Cola is well-positioned to capitalize on market opportunities and generate long-term value for investors.
Chord Energy, Energy Transfer, and Coca-Cola are three attractive dividend stocks to consider in 2024. These companies offer stable dividend yields, growth potential, and strong fundamentals, making them compelling choices for income-seeking investors in uncertain market conditions. By diversifying your portfolio with dividend-paying stocks like CHRD, ET, and KO, you can potentially mitigate risks and enhance your overall investment returns over the long term. Stay informed, do your research, and consult with financial experts to make informed decisions about your investments.