Tuesday, September 20, 2022

October 2022 Dividend Stock Watch List

As I'm writing this blog post, today, September 16th, is the day before a somber occasion. Those who know me personally may be aware that my paternal grandfather passed away long before I was born and my maternal grandfather passed away when I was four years old.

My paternal grandmother eventually met a partner who would fill the role as my grandfather from the moment I was born until just recently. Unfortunately, he passed away suddenly on September 11th. And tomorrow is his funeral, with the publication date of this blog set to have been his 74th birthday. I'm so grateful to have had the chance to know him and will deeply miss him.

On that note, I will be going over the dividend stocks that are on my watch list for October since this month is already more than half over.

Image Source: Pexels

Dividend Stock #1: Comcast (CMCSA)

As I indicated in my April 2022 Dividend Stock Watch List post, the telecom and media conglomerate Comcast is a balanced business with growth catalysts. Thanks to growth in its customer count, the company's first-half revenue increased 9.5% year-over-year to $61 billion. This led CMCSA's adjusted diluted EPS to surge 16.3% higher over the year-ago period to $1.86 through the first half of 2022 (info in the previous two sentences sourced from page 1 of 16 of Comcast Q2 2022 earnings press release).

Analysts are forecasting 10.2% annual earnings growth over the next five years. And given that the stock's dividend payout ratio will be less than 30% in 2022, there is plenty of room for the dividend to grow moving forward. This is an especially attractive proposition considering that CMCSA's dividend yield is 3.1%. At the current $35 share price, the cherry on top is that the stock is trading at a forward P/E ratio of 9.6.

Dividend Stock #2: Medifast (MED)

The weight loss and nutrition company Medifast has a short track record of dividend growth. But with dividend growth well into the double-digits annually during that time, it's an impressive one. MED's leadership in its industry is why analysts are anticipating 20% annual earnings growth over the next five years.

With the dividend payout ratio expected to come in under 60% in 2022, dividend growth should be pretty close to earnings growth for the foreseeable future. That's intriguing for a stock with a 5.5% dividend yield. And MED is trading at a forward P/E ratio of 11.1 at the current $119 share price. That's quite cheap for its long term growth potential.

Dividend Stock #3: STAG Industrial (STAG)

The third and final stock on my watch list for October is STAG Industrial. For the sake of brevity, I will refer interested readers to my recent Motley Fool article on STAG and Innovative Industrial Properties. Basically, STAG offers investors a 4.7% dividend yield that's also well-covered. And the company's e-commerce-oriented portfolio is poised to do well as the future unfolds. At the current $31 share price, STAG is trading at a TTM P/AFFO ratio of less than 15. This is arguably a solid value for a wonderful company.

Concluding Thoughts:

Another month, another three quality dividend stocks on my watch list in October. I very much look forward to adding to my positions in these stocks in the coming weeks. With the capital allocation that I'm planning for next month, my net annual forward dividends should be boosted by nearly $70 as a result of such purchases.


Are CMCSA, MED, and/or STAG on your watch list for next month?

If not, what stocks are on your radar for October?

I appreciate your readership and welcome your comments below.

No comments:

Post a Comment