As I'm writing this blog post, it's Tuesday, June 9th. The temperature here in Central Wisconsin reached a high of 84 degrees Fahrenheit earlier today with a sunny forecast, so I was glad to spend some time outside.
Now that my stock purchases are largely complete for June 2026, I will be looking ahead at the dividend stocks on my watch list for next month. Let's dive into it!
Dividend Stock #1: Brookfield Asset Management (BAM)
The first stock on my watch list for July 2026 is Brookfield Asset Management. Interested readers can check out my May 2026 Stock Watch List blog post or my recent Seeking Alpha article for my investment thesis.
The crux of my investment thesis is that BAM's $67 billion in fundraising leading up to its Q1 2026 earnings call shows that its secular-driven growth isn't slowing down. This is because more institutional and retail investors are increasing their allocation to alternative assets for their returns, low correlation with stock and bond markets, and portfolio diversification. That's driving the forecast for upper-teens percentage annual distributable EPS growth over the next several years.
The 4.3% dividend yield (from the current $47 share price) modestly exceeds the forecast for distributable EPS for 2026. However, the payout is reasonably protected by steady cash flows (87% of fee-bearing capital is long-term or permanent), capital-light business model, and $2.5 billion in corporate liquidity against no debt maturities until 2030 (and an A- S&P credit rating). This gives BAM the confidence that it can deliver 15%+ annual dividend growth.
Appraising the alternative asset manager as a yield vehicle with a growth kicker, shares are trading 18% below my updated fair value per share estimate of $57. This assumes a fair value yield of 3.5% for BAM, which is arguably reasonable even in an elevated rate environment. That's because, while it comes with risks, it offers the potential for significant passive income growth over time. In my opinion, the same simply can't be said about bonds.
Dividend Stock #2: Genpact Limited (G)
The next stock on my watch list for the month ahead is Genpact Limited. For the gist of my investment thesis, I would refer readers to my May 2026 Dividend Stock Purchases/Sales blog post.
Basically, G is an investment-grade IT services and solutions company that I believe can continue to compound its adjusted diluted EPS by around 10% annually. While generative AI fears have caused a sharp selloff in 2026 so far, the Advanced Technology Solutions segment (implementing AI for Fortune 500 businesses) is contradicting the concern that AI is going to replace its business. On the contrary, the ATS segment's net revenue soared 24.3% over the year-ago period in Q1 2026 (to now 27% of total net revenue). All the while, the core business held its own, reporting 1.4% growth in Q1 2026.
The 2.3% dividend yield is very safe, with the payout ratio set to be in the high-teens in 2026. That should power at least 10% annual dividend growth over the next several years.
At the current $33 share price, the stock is trading at a forward 12-month P/E ratio of just 7.7. No, that's not a typo. Yes, you read that right. This is less than half of the 10-year average FAST Graphs P/E ratio of 17.1 and the five-year average of 15.6.
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Given G's intact growth prospects, I believe a reversion to 15x is a reasonable base case. That would imply shares are trading at a 49% discount to my $63 fair value per share estimate. Even applying the more conservative $53 fair value per share estimate from my friends over at GNG Research (by the way, anybody signing up with my link above receives 35% off every payment), shares are an undeniable value right now.
Dividend Stock #3: McDonald's Corporation (MCD)
The third stock on my watch list for July 2026 is none other than McDonald's Corporation.
As macro pressures have squeezed discretionary budgets, lower consumers have become especially selective. My investment thesis centers on MCD dominating the value wars and reclaiming traffic, with everyday menus priced under $3 alongside targeted promotions, such as the $4 Breakfast Meal Deal. Then, there's the fact that more than 95% of locations operate under franchised models (all but 2,027 of the nearly 45,700 systemwide restaurants).
In essence, McDonald's is both a landlord (the greater of a base minimum rent or a percentage of gross sales generally around 8% to 10% is paid in rent) and a tollbooth-like franchisor (franchisees typically pay a royalty fee of 4% to 5% of gross monthly sales). When the cost of inputs like beef, potatoes, and labor go up, franchisees are typically forced to raise menu prices to protect unit economics. In turn, MCD takes its cut of these larger sales stemming from inflation right off the top.
That's why the FAST Graphs analyst consensus is for 8.1% annual non-GAAP diluted EPS through 2028, off a 2025 base of $12.20. MCD also enjoys a BBB+ S&P credit rating with a stable outlook.
The 2.6% dividend yield is also secure, with the payout ratio poised to be in the mid to high-50% range in 2026. That should enable decent dividend growth over the next few years.
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GNG Research
From the current $282 share price, the stock is arguably somewhat undervalued, too. MCD is priced at a forward 12-month P/E ratio of 20.9. This is moderately below the 10-year average P/E ratio of 25.2 and is 9% under my fair value per share estimate of $311 (a fair value P/E ratio of 23, which is almost a standard deviation less than the 10-year average). GNG Research is even more bullish, with a $349 fair value per share estimate.
Dividend Stock #4: Microsoft Corporation (MSFT)
The next stock on my watch list for the upcoming month is Microsoft Corporation. This one has been no stranger to the list in recent months, so I would encourage readers to check out my June 2026 Stock Watch List blog post for my investment thesis.
Essentially, MSFT has big growth catalysts with cloud computing, enterprise software, and AI. These secular tailwinds are why FAST Graphs anticipates upper teens percentage annual non-GAAP diluted EPS growth through FY 2028, off a FY 2025 base of $13.64.
MSFT is the only tech company in the world with a flawless AAA S&P credit rating with a stable outlook. The 0.9% dividend yield is modest. However, with the payout ratio likely to be in the low-20% range for FY 2026, there's plenty of room for 10%+ annual dividend growth to persist.
At the current $403 share price, the stock is trading at forward 12-month P/E ratio of 20.9. That's well below the 10-year average P/E ratio of 29 and 25% under my fair value per share estimate of $539 (a fair value P/E ratio of 28).
Dividend Stock #5: NVIDIA Corporation (NVDA)
The fifth stock on my watch list for July 2026 is NVIDIA Corporation. Just like MSFT, I'm running this one back.
This is because NVDA is a paradoxical example of a stock that doubles as a value stock (more on that in a second) and a growth stock. The continued AI infrastructure buildout around the world has the FAST Graphs analyst consensus for FY 2027 (ending in January 2027) non-GAAP diluted EPS soaring 86.4% to $8.89. In FY 2028, another 38.3% spike is anticipated to $12.29. For FY 2029, an additional 21.1% surge to $14.88 is the current consensus. So, that's the growth aspect of NVDA.
Not to mention that shares are trading at a forward 12-month P/E ratio of just 20.5. That's a fraction of the 10-year average P/E ratio of 44.3 and the 20-year average P/E ratio of 35.1! It's also cheaper than the S&P 500.
The balance sheet is also world-class, with an AA- S&P credit rating and a stable outlook. As if this wasn't enough, NVDA is also now a dividend growth stock after its whopping 2,400% hike in the quarterly dividend per share to $0.25 last month. All the while, the payout ratio is set to be roughly 9% in FY 2027. In other words, more strong dividend growth is likely on the way. That's why I'm excited about a seemingly small 0.5% yield.
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GNG Research
Even my rather conservative fair value P/E ratio of 30 yields a fair value per share estimate of $303. That's up from my prior fair value estimate of $265 and is 32% below the current share price. GNG Research's potentially more base-case fair value of $355 would represent a staggering 42% discount to fair value.
Concluding Thoughts:
That's all for now. Based on my currently planned allocations to each, my yield will be around 2.2% (I'll probably add a small position in an existing qualitative high-yielder to juice this a bit further). This isn't the most impressive yield, but for my money, I think this is a fantastic basket of stocks that offers a bit of everything.
Discussion:
Are any of BAM, G, MCD, MSFT, or NVDA on your watch list for July 2026?
If not, what stocks are you monitoring in the month ahead?
Thanks for your readership and I look forward to your comments below!
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