Notable Analyst Upgrades and Downgrades for Week of June 24, 2019




Upgrades:


Nike (NYSE:NKE) was upgraded by Bank of America to an “underperform” rating in a research note issued to investors on Monday, The Fly reports. A number of other equities research analysts also recently weighed in on the company. Morgan Stanley set a $103.00 price objective on Nike and gave the company a “buy” rating in a report on Thursday. Canaccord Genuity reaffirmed a “buy” rating and set a $96.00 price objective on shares of Nike in a report on Wednesday, June 19th. UBS Group set a $85.00 price objective on Nike and gave the company a “neutral” rating in a report on Monday, June 17th. Zacks Investment Research raised Nike from a “sell” rating to a “hold” rating and set a $95.00 price objective on the stock in a report on Monday, May 27th. Finally, JPMorgan Chase & Co. reaffirmed a “buy” rating and set a $90.00 price objective on shares of Nike in a report on Friday, April 12th. Two investment analysts have rated the stock with a sell rating, ten have issued a hold rating and twenty-four have assigned a buy rating to the company’s stock. The stock presently has an average rating of “Buy” and a consensus target price of $87.58. Read more …

Deere & Company (NYSE:DE) was upgraded by investment analysts at Jefferies Financial Group from a “hold” rating to a “buy” rating in a research note issued to investors on Monday, The Fly reports. A number of other analysts have also issued reports on DE. Zacks Investment Research lowered Deere & Company from a “hold” rating to a “sell” rating in a research note on Wednesday, April 17th. UBS Group initiated coverage on Deere & Company in a research note on Tuesday, April 23rd. They issued a “neutral” rating and a $238.00 price target on the stock. Macquarie initiated coverage on Deere & Company in a research note on Wednesday, May 1st. They issued an “outperform” rating on the stock. Berenberg Bank initiated coverage on Deere & Company in a research note on Thursday, May 9th. They issued a “hold” rating on the stock. Finally, Robert W. Baird lowered Deere & Company from an “outperform” rating to a “neutral” rating and decreased their price target for the stock from $166.00 to $150.00 in a research note on Monday, May 13th. Two equities research analysts have rated the stock with a sell rating, eight have issued a hold rating and fourteen have assigned a buy rating to the company’s stock. Deere & Company currently has an average rating of “Buy” and a consensus target price of $165.82. Read more …

United Technologies (NYSE:UTX) was upgraded by investment analysts at Cowen from a “market perform” rating to an “outperform” rating in a note issued to investors on Monday, MarketBeat Ratings reports. The firm currently has a $150.00 target price on the conglomerate’s stock, up from their prior target price of $135.00. Cowen’s price target points to a potential upside of 15.23% from the company’s previous close. Several other brokerages have also recently weighed in on UTX. Zacks Investment Research raised shares of United Technologies from a “sell” rating to a “hold” rating in a research note on Friday, April 26th. Morgan Stanley boosted their price objective on shares of United Technologies from $155.00 to $164.00 and gave the stock an “overweight” rating in a research note on Monday, May 20th. Vertical Research raised shares of United Technologies from a “hold” rating to a “buy” rating and set a $145.00 price objective on the stock in a research note on Friday, June 14th. Barclays boosted their price objective on shares of United Technologies from $142.00 to $149.00 and gave the stock an “overweight” rating in a research note on Wednesday, April 24th. Finally, Royal Bank of Canada reissued a “sector perform” rating and issued a $159.00 price objective on shares of United Technologies in a research note on Wednesday, April 24th. Five analysts have rated the stock with a hold rating, twelve have assigned a buy rating and one has assigned a strong buy rating to the company’s stock. The stock presently has an average rating of “Buy” and a consensus target price of $150.50. Read more …



ConocoPhillips (NYSE:COP) was upgraded by analysts at Mizuho from a “neutral” rating to a “buy” rating in a research note issued on Wednesday, The Fly reports. Other research analysts have also issued research reports about the stock. ValuEngine lowered shares of ConocoPhillips from a “hold” rating to a “sell” rating in a research note on Friday, May 3rd. Credit Suisse Group lowered shares of ConocoPhillips from an “outperform” rating to a “neutral” rating and set a $64.00 price target on the stock. in a research note on Wednesday, May 1st. Zacks Investment Research upgraded shares of ConocoPhillips from a “hold” rating to a “buy” rating and set a $74.00 price target on the stock in a research note on Wednesday, March 13th. Piper Jaffray Companies upgraded shares of ConocoPhillips from a “neutral” rating to an “overweight” rating and increased their price target for the stock from $68.00 to $75.00 in a research note on Thursday, March 21st. Finally, Morgan Stanley increased their price target on shares of ConocoPhillips from $77.00 to $78.00 and gave the stock an “overweight” rating in a research note on Monday, March 4th. One equities research analyst has rated the stock with a sell rating, four have assigned a hold rating and twelve have assigned a buy rating to the company. The stock currently has an average rating of “Buy” and a consensus price target of $78.36. Read more …

Leggett & Platt: A Dividend Aristocrat to Buy Now


The Dividend Aristocrats are widely considered to be the best-of-the-best when it comes to dividend growth stocks. Indeed, the Dividend Aristocrats are an exclusive group of 57 stocks in the S&P 500 Index with at least 25 years of annual dividend increases. The Dividend Aristocrats have long-lasting brand power, competitive advantages, and shareholder-friendly management teams that are committed to growing profits and dividends over the long-term.


But on occasion, even the Dividend Aristocrats experience downturns. Leggett & Platt (LEG) is a Dividend Aristocrat, having raised its dividend for 48 years in a row. But the stock has declined 12% in the past three months, and has underperformed the broader S&P 500 Index by a wide margin to start 2019.

However, Leggett & Platt has a plan to overcome the recent challenges and continue to grow for the long-term. The stock has an attractive valuation, and a high dividend yield above 4%. Therefore, Leggett & Platt is one of the best dividend stocks for long-term dividend growth investors.




Business Overview & Recent Events


Leggett & Platt is a diversified manufacturing company. It designs and manufactures a wide range of products, including bedding components, bedding industry machinery, steel wire, adjustable beds, carpet cushioning, and vehicle seat support systems. The company has a large and diverse product portfolio.



Disney's Appeal as a Long-term Dividend Growth Stock


Walt Disney founded his namesake company in 1923, and since then the business has gone on to become one of the most iconic brands ever created. Today Walt Disney (DIS) is a leading entertainment company with about $60 billion in revenue.

The media conglomerate is highly diversified and vertically integrated, with four major business segments. Here are the company's sales and profits through the first half of fiscal 2019:

1. Media Networks (38% of sales, 47% of profits): TV programming (ABC TV and cable channels like A&E, History, Lifetime and ABC Family, ESPN network), radio (radio Disney, ESPN radio network), eight television stations. In total the company has about 100 Disney-branded television channels, which are broadcast in 34 languages and 162 countries.

2. Parks & Resorts (43% of sales, 49% of profits): owns theme parks and resorts around the globe including Walt Disney World In Florida, Disneyland in California, Disney Land Paris, Shanghai, and Hong Kong. Also operates Disney Resort & Spa in Hawaii, the Disney Vacation Club, Adventures by Disney, and the Disney Cruise Line.

3. Studio Entertainment (13% of sales, 11% of profits): produces live-action and animated films under the Walt Disney Pictures, Walt Disney Animation, Pixar, Marvel, and Lucasfilm (Star Wars, Indiana Jones) studio banners. This segment's profitability is volatile and driven by the number of successful releases each year.

4. Consumer Products & Interactive Media (6% of sales, -7% of profits): licenses Disney's trade names, characters, and visual and literary properties, develops and publishes mobile games, and sells its products through its own online stores and various retail outlets around the globe.



In December 2017, Disney announced it was buying Twenty-First Century Fox in a $66 billion deal. As part of a bidding war with Comcast (CMCSA), Disney ultimately raised its offer to $71.3 billion in cash and stock. The Fox acquisition closed on March 20, 2019. 




Southern Company: Uninterrupted Dividends Since 1948


In business for more than 100 years, Southern Company (SO) is a major regulated utility involved in selling electricity and distributing natural gas, primarily across the Southeastern U.S. The firm's eight vertically integrated electric and gas utilities serve customers across Georgia, Alabama, Florida, and Mississippi.

Southern Company’s mix of business and service territories significantly changed after the company's 2016 acquisition of natural gas utility AGL Resources for $12 billion. AGL Resources owns more than 80,000 miles of pipelines and over a dozen storage facilities it uses to transport and distribute natural gas to businesses and households across Illinois, Georgia, Virginia, New Jersey, Florida, Tennessee, and Maryland. 

After acquiring AGL Resources, Southern Company's customer count roughly doubled to 9 million, and its business mix shifted from 100% electric to a 50/50 mix of electric and gas. The utility services a diversified blend of residential, commercial, industrial, and wholesale customers.

Approximately 95% of the company's earnings are funded by state-regulated utilities and businesses with long-term contract models, providing predictable cash flow. Southern Company has also made great strides in transitioning its energy production mix from 69% coal in 2007 to nearly half from natural gas today, with a significant portion also now coming from renewable sources.


As the industry keeps moving toward cleaner power generation, by 2030 the firm wants to reduce its CO2 emissions by 50% from 2000 levels. Even more ambitious, by 2050 Southern Company plans to generate all of its power from low emission (gas) or no emission (nuclear and renewable) sources.



How High Can Starbucks Fly? It All Hinges on One Metric


The stock is soaring, and it could keep going up -- as long as comps do, too.



Who says megarestaurant chains can't be high-octane growth companies? Starbucks (NASDAQ:SBUX) has rocketed 46% higher in the last year as the world's third-largest restaurant chain by number of locations has reignited existing store sales growth. Despite the surge in stock price, though, the coffee shop and retailer can keep climbing if it can demonstrate that its recent momentum in comps is more than just fleeting.

What's the deal with comps?

Comparable-store sales is a combination of the number of transactions (foot traffic) and ticket size per order at existing stores -- in Starbucks' case, stores that have been open for at least 13 months. For a company with over 30,000 locations worldwide, rising comps is one of the primary ways Starbucks can increase profitable sales.

Comps were touch-and-go in 2018. Though the metric ended the year up 2%, there were quarterly declines at times -- especially in the important growth region of China and greater Asia. The annual rate was a deceleration from years past. As early as 2016, Starbucks was still putting up 6% global comps growth.


For fiscal 2019 to date, though, Starbucks has had a resurgence in comps -- up 4% in the second quarter and 3% in the first. Leading the charge has been the U.S. Though new store openings in North America have slowed to a low single-digit crawl, it's where the majority of global locations are located (currently over 17,700). Thus, comps are the most important way to grow overall sales in what is still Starbucks' largest market.




CVS Stock Has More Going for It Than Just a 3.69% Dividend Yield


CVS stock very well could be the big bet you're missing



CVS Health (NYSE: CVS) faces two distinct headwinds that are putting pressure on CVS stock.

First, markets are cautious over the drug store and drug manufacturing market as the government pressure all players to lower drug prices.

Doubts over CVS’ acquisition of Aetna are adding more distractions for management in the near-term. With CVS stock testing the $51.72 yearly low on at least five occasions since March, what will it take for the stock to rebound?



CVS reported first-quarter earnings of $1.62 and also raised its full-year adjusted EPS guidance to $6.75 to $6.90. This is up from the previous guidance of $6.68 to $6.88 a share.

The Q1 beat and improved outlook are due largely to the inclusion of managed care operations. The company also included revenue from SilverScript Medicare Part D, which contributed $17.9 billion of revenue for the quarter.


Better synergies with Aetna also contributed favorably to the higher outlook. CVS expects it will exceed its target savings of $750 million in 2020. It found synergies stemming from the elimination of duplication in corporate and operational functions, medical cost savings such as formulary alignment, and purchasing efficiencies. By 2022, CVS forecast saving $1.5 billion to $2 billion, well above its deal synergy targets.




Target Corporation: Overlooked Retail Stock Just Raised Its Dividend Again


1 Retail Stock for Income Investors to Consider



When almost everyone thinks that the retail industry is done because more consumers are shopping online, one retail company just keeps on raising its payout to investors.

I’m talking about Target Corporation (NYSE:TGT), which operates more than 1,800 department stores located across the U.S.

On Thursday, June 13, Target declared a quarterly cash dividend of $0.66 per common share. The amount represented a 3.1% increase from the company’s previous quarterly dividend rate of $0.64 per common share. The raised dividend will be paid on September 10, 2019 to shareholders of record as of August 21. (Source: “Target Corporation Announces 3.1 Percent Dividend Increase,” Target Corporation, June 13, 2019.)


A three-percent payout increase may not seem like much in an era where people care about capital gains the most. However, the announcement on Thursday marked the continuation of an important tradition at Target Corporation: returning an increasing amount of cash to shareholders.




Lowe's Dividend Stock Analysis



Lowe's Companies, Inc. (LOW), together with its subsidiaries, operates as a home improvement retailer in the United States, Canada, and Mexico. The company offers a line of products for construction, maintenance, repair, remodeling, and decorating. Lowe's is one of the Original Dividend Aristocrats from 1989.


Lowe’s is one of 26 dividend kings in the US. The company hiked its quarterly dividend by 15% to 55 cents/share just last week. This marked the 57th consecutive annual dividend increase for the dividend king. Over the past decade, the company has managed to increase distributions at an annualized rate of 18.40%.


10 Smart Dividend Stocks for the Rest of the Year


If you're looking to scale back on aggressive exposure and beef up safety-minded holdings, start here



The market has managed to back itself away from imminent danger, bouncing back from a relatively serious stumble from a couple of weeks ago. It’s too soon to say stocks will be able to remain out of trouble, though. Aside from a lethargic time of year, the wrong headline could still easily up-end it all.

Or, perhaps the market will continue to climb.

In an uncertain environment like the one we find ourselves in now, sometimes the right strategic move is to simplify. Step into reliable cash cows, accumulate cash from dividends, and wait for a more opportune time to make risky bets.

The $64,000 question is, of course, which dividend stocks? They certainly aren’t all built the same.


Here’s a run-down of 10 different dividend stocks to buy, from a variety of industries. Investors won’t necessarily need all of them to create a more defensive-minded portfolio, though considering more than one might not be a bad idea either.


High Dividend Stocks — June 2019


High dividend stocks appeal to many investors living off dividends in retirement because their high yields provide generous income.

Many of the highest paying dividend stocks offer a high yield in excess of 4%, and some even yield 10% or more.

However, not all high yield dividend stocks are safe. Let’s review what high dividend stocks are, where stocks with high dividends can be found in the market, and how to identify which high dividends are risky.

At the end of the article, we will take a look at 23 of the best high dividend stocks, providing analysis on each company. Almost all of these high yield stocks offer a dividend yield greater than 4%, have increased their dividends for at least five consecutive years, and maintain healthy Dividend Safety Scores.

The market’s strength has reduced the number of safe dividend stocks with high yields, but there are still several dozen worth reviewing.




By the way, many of the people interested in high dividend stocks are retirees looking to generate safe income from dividend-paying stocks. If that sounds like you, you might like to try our online product, which lets you track your portfolio’s income, dividend safety, and more.

You can learn more about our suite of portfolio tools and research for retirees by clicking here.




6 Big Dividend Stocks to Buy as Yields Plunge


Yields are plunging, and that makes big dividend stocks look that much more attractive



A lot happened in financial markets in May. One of the more important things that happened was in the bond market. Fixed income yields plunged in May on concerns that the global economy is slowing and will continue to slow as trade tensions between the U.S. and China remain elevated. Specifically, the 10-Year Treasury Yield has dropped below 2.3% in late May, after peaking right around 3.3% in late 2018, and is now at its lowest level since late 2017.

One implication of plunging yields is that stocks with big dividend yields become more attractive. Why? Because the lower yields go, the higher dividend yields are relative to those fixed income yields. Thus, when yields plunge, investors tend to flock into dividend stocks with big yields.




Because of this dynamic, plunging yields create a good opportunity to buy into dividend stocks with big yields. Which stocks should be on your list of stocks to buy? Let’s take a look at six big dividend stocks to consider as yields plunge.




Is Johnson & Johnson A Buy In June 2019?


When it comes to dividend growth stocks, healthcare giant Johnson & Johnson (JNJ) is among the best of the best. It has a legendary reputation among dividend investors, for a good reason. Johnson & Johnson has increased its dividend for 57 years in a row. It is a member of the Dividend Aristocrats, a group of 57 stocks in the S&P 500 Index with at least 25 years of annual dividend increases.

They are the ‘best of the best’ dividend growth stocks. The Dividend Aristocrats have a long history of outperforming the market.

The requirements to be a Dividend Aristocrat are:

Be in the S&P 500
Have 25+ consecutive years of dividend increases
Meet certain minimum size & liquidity requirements

Not only is J&J a Dividend Aristocrat, it is also part of the even more exclusive list of Dividend Kings. The Dividend Kings total just 24 companies that have increased their dividends for 50+ consecutive years.

Johnson & Johnson has all of the necessary qualities of a great dividend growth company. It generates steady earnings growth from its diverse business segments, and the company has plenty of growth opportunities ahead in the U.S. and around the world.



Johnson & Johnson has an operating history going back more than 100 years, and since then has grown into one of the largest healthcare companies in the world. It has steadily rewarded shareholders with annual dividend increases for over five decades, and there remains a long runway of growth potential up ahead.