Since the beginning of this year, Wall Street has faced a storm of macro headwinds that have turned last year’s bullish run into a bearish trend. Year-to-date, the NASDAQ is down 27%, and the S&P, with a loss of 18%, is not far behind. The market drops with the gains of Treasury bonds – the rate of 10 year Treasury notes up to about 2.9%. In a thumbnail summary, we can say that last year, investors looked at the market through the eyes of TINA (no alternative); Now, the terms are starting to show those options.
In this environment, Goldman Sachs recommends that investors look for ‘security margins’ to protect their investment portfolios if market conditions worsen. One of the factors recommended by the investment banking giant is a reliable dividend, to ensure a stable income flow.
Against this background, Goldman Sachs stock analysts have opted for recommended stocks whose dividend payments are yielding higher than the market average. We used TipRanks’ database to find out the details of these two stocks; Let’s take a closer look at them.
Simon Property Group (SPG)
The first dividend stock we will look at is a real estate investment trust (REIT), a class of companies well known for their reliable, high-yield dividends. Simon Property Group is a major investor in retail assets, including shopping malls and one of the largest portfolios of retail assets in the United States. The company’s assets include 31 shopping malls and 31 international locations, including 69 premium retail outlets. By the end of 2020, SPG owns 80% of Taubman Realty, a leading mall operator with 24 properties in the United States and Asia.
Simon’s features bring steady earnings and have consistently been above $ 1 per share since 1Q21. At 1Q22, SPG reported net income of $ 426.6 million for shareholders, or $ 1.30 per mixed share. Total funding from operations (FFO), a key metric for REIT, grew 12% year on year from $ 934 million to $ 1.046 billion.
In two important metrics, the company increased its holdings from 90.8% to 93.3% and 2.7% from 1Q21 to 1Q22. And across the company’s property, the minimum rent per square foot base was $ 54.14 at the end of March.
Looking ahead, SPG has raised its FFO guidelines for 2022 from $ 11.60 per share to 75 11.75; This represents a half-percent bump in the midline, and analyst consensus puts the upper edge above $ 11.72. Overall, Simon’s results in 1Q22 lost the previously published forecast.
With this financial performance in the background, Simon was confident of raising dividends for June payments, up from 65 1.65 in the last quarter to the upcoming 1.70. At সাধারণ 6.80 per share per year, it pays a dividend of 6%, which is about 4x the average found in firms on the S&P index.
In SPG’s coverage for Goldman Sachs, analyst Caitlin Burrows sees the company moving to support its growth and share price for stockholders, writing, “SPG could allocate its huge post-dividend and post-redevelopment retained cash (which we assume The company averaged $ 1.0 billion per year in 2022 and 2023 (either through acquisitions of retail platforms, and through high-quality retail assets), or alternatively to repurchase its shares … The company announced a শেয়ার 2.0 billion share repurchase program ( More than 24 months), and plans to repurchase its stock. We view management’s comments and announced share repurchases as positive … “
Consistent with these comments, Burrows gives SPG a buy rating and a ্যের 166 price target to indicate a 12-month uptrend of 45%. (To see Barrow’s track record, Click here)
Overall, Wall Street Analyst Consent on Simon Properties is a median buy based on 6 buy and 8 hold issued in recent months. SPG shares are trading at 114.5, with an average price target of 3 153.29; This suggests a 12-month reversal probability of ~ 34%. (See SPG stock forecast in Tiprank)
HF Sinclair Corporation (DINO)
The stock of the second dividend on Goldman’s radar is an energy company formed earlier this year after the merger between Holy Energy Partners and Sinclair Oil. The consortium, HF Sinclair, started business under the DINO ticker in March and has generated a lot of interest from both domestic and retail investors.
Earlier this month, HF Sinclair reported its first financial results (1Q22) since the merger was completed. At the top line, the company reported total revenue of $ 7.45 billion. It supports a net income of $ 175.9 million quarterly, or 99 cents per mixed share.
Sound Financials supported a 14% increase in declared dividends – the next payment would be 40 cents per ordinary share. Annual rate, $ 1.60, yield 3.4%, S&P average more than double. This is the first dividend increase for Dino; As HollyFrontier, the company had a 7-year history of gradual dividend growth.
Covering the stock for Goldman Sachs, 5-star analyst Neil Mehta writes that he is bullish on Dino, among its reasons: ) Assuming the capital return is set to inflate, DINO now offers a maximum 2023 capital return in our estimation within our C-Corp refining coverage. Conducts consensus assumptions, in our view. “
Mehta’s bullish statements back up his buy rating on Dino, while his $ 56 price target suggests a 22% rise for the stock next year. (To view Mehta’s track record, Click here)
Like the SPG above, DINO has a moderate buy rating from the analyst consensus. It is based on 12 recent analyst reviews, which broke down into 8 buy and 4 hold. The stock is trading at $ 46.94 and has an average price target of $ 48.33, a 5% increase over the next 12 months. (See Dino Stock Forecast in Tipranks)
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Disclaimer: The views expressed in this article are those of the featured analysts only. Content is intended for informational purposes only. It is very important to do your own analysis before making any investment.