June 2025 Stock Watch List

As I'm writing this blog post, it's Friday, May 9th. The temperature here in Central Wisconsin is expected to reach a high of 72 degrees Fahrenheit today with a sunny forecast. The forecast for this weekend is going to be just as pleasant, with respective highs reaching 73 and 75 on Saturday and Sunday.

Now that I have made my stock purchases for this month, it would be a good time to look ahead to June 2025. Here are three stocks that are highest on my watch list for the month.

Stock #1: Energy Transfer (ET)

The first stock on my watch list for June 2025 is Energy Transfer. Interested readers can find my updated investment thesis in my recent Seeking Alpha article. Otherwise, my thesis is essentially the same as it was from my November 2024 Dividend Stock Watch List blog post.

ET's first-quarter results were solid. The company's credit ratings are investment-grade. The 7.7% distribution yield is easily covered by DCF. The icing on the cake is that the $17 unit price (as of May 9th, 2025) is significantly below my fair value estimate of $22 a unit.

Stock #2: Alphabet (GOOGL)

The next stock on my watch list for next month is Alphabet. My investment thesis is pretty much the same as it was in my March 2025 Dividend Stock Watch List blog post.

GOOGL massively beat earnings expectations in Q1. Despite ongoing legal disputes, the company has plenty of growth catalysts moving forward. The AA+ credit rating is another positive. GOOGL's 5% dividend raise to begin its dividend growth streak was modest. However, I believe this low floor is going to be very easy for the company to beat over time. GOOGL's $153 share price is a forward P/E ratio of less than 16, which is well below the 10-year average P/E ratio of nearly 25.

Stock #3: Merck (MRK)

The final stock on my watch list for June 2025 is Merck. Curious readers can check out my recent listicle on iREIT+Hoya for my updated investment thesis.

For those without a subscription, my thesis is basically that MRK is taking steps to minimize the loss of exclusivity hit to Keytruda via a subcutaneous version of the drug. This could be approved by the U.S. FDA this September. New products like Winrevair and Capvaxive also have blockbuster peak sales potential. The company's A+ credit rating from S&P also gives it opportunities for bolt-on acquisitions to further bolster its commercial product lineup and product pipeline. MRK's 4.3% dividend yield is also well-covered. Shares trade at a forward P/E ratio of about 8, which is significantly below the 10-year average P/E ratio of just above 15. That makes the stock a bargain from the current $76 share price.

Concluding Thoughts:

That's it for now. I'll likely target a roughly 50% allocation to GOOGL, a 30% allocation to MRK, and a 20% allocation to ET with capital for the month. This will keep me close to a 3% dividend yield, blending growth, value, and yield.

Discussion:

Are any of ET, GOOGL, or MRK on your watch list for June 2025?

If not, what stocks are you considering for next month?

Thanks for your readership. I look forward to your comments below!