Dividend-paying stocks have always been a top choice for investors seeking income, with research showing that these stocks outperform non-dividend-paying companies and the broader market in the long term. Dividend yield is a key factor in dividend growth, and the Dividend Aristocrats Index has consistently delivered high yields over the past 26 years, outperforming the market. These stocks also offer lower volatility and downside protection compared to other asset classes.
In 2023, companies saw strong corporate balance sheets and increased cash flow, leading to a 5% rise in overall dividend growth. Analysts predict a positive outlook for dividends in 2024, with a forecasted increase of 3.9% on a headline basis. Among the dividend aristocrats ranked by yield, International Business Machines Corporation (IBM) stands out with a dividend yield of 3.86% as of June 25, placing it ninth on the list. IBM extended its streak of dividend growth to 29 years with a 0.6% increase in its quarterly dividend to $1.67 per share.
While IBM reported mixed first-quarter earnings for 2024, the company’s major segments experienced growth, with total revenue increasing by 3% year over year. Challenges in the consulting business due to economic uncertainty have been offset by the success of AI-related projects, with IBM securing over $1 billion in generative AI-related business since the beginning of the year. As of the end of Q1 2024, 49 hedge funds held positions in IBM, with a total value exceeding $1 billion.
Overall, while IBM ranks ninth on the list of the best dividend aristocrats based on yield, there are other deeply undervalued dividend stocks that may offer greater potential for higher returns in a shorter timeframe. Investors looking for such opportunities can explore reports on these stocks and consider their investment strategies.
Article Source
https://finance.yahoo.com/news/international-business-machines-corporation-ibm-220842984.html
