Dividends are payouts from companies that share their profits with their investors. They offer a regular source of income that can increase over time. This makes them particularly attractive for long-term investments. Even a small dividend yield can result in impressive returns after many years. Dividends can offer protection against market volatility, another reason that investors include these stocks in their portfolios.
Strong Buy Dividend Stocks
Using the TipRanks Dividend Calendar, we searched for top stocks with an ex-dividend date in January 2022. Investors need to own the stock by the ex-dividend date to receive the next payout. We focused on top dividend stocks with a Buy analyst rating consensus and at least a 5.5% yield. We found five top stocks that match these criteria.
Top 5 Dividend Stocks
Saratoga Investment (NYSE: SAR)
Dividend yield: 7.96%
Ex-dividend date: Jan 03, 2022
Payout ratio: 91.73%
Payout date: Jan 19, 2022
Saratoga Investment is a business development company. At the end of November, the company announced an increase in its quarterly dividend of $0.01 to $0.53 per share. At the current price, this translates into an almost 8% yield, which can be either received in cash or reinvested. Both analysts who have rated the stock in the past three months have given it a Buy rating. Their average price target of $31.50 indicates 6.78% upside over the next 12 months. Looking at investors with a TipRanks Smart Portfolio, there has been a 9.2% increase in the number of top-performing portfolios that hold the SAR stock in the past seven days. With a positive signal from financial bloggers, too, Saratoga has an Outperform Smart Score, according to our data-driven stock score.
AT&T (NYSE: T)
Dividend yield: 8.35%
Ex-dividend date: Jan 07, 2022
Payout ratio: 61.60%
Payout date: Feb 01, 2022
Telecommunications giant AT&T is going through significant changes. In 2022 it will combine its WarnerMedia business with Discovery and following the deal, there will be a drop in dividend yield. However, for now it remains an attractive 8.35%. Analysts are mixed on the stock, which has a Moderate Buy rating consensus. Out of ten analysts who rated the stock in the past three months, five said Buy, four said Hold, and one said Sell. Their average price target of $29.22 shows around 17% upside potential. In November, one of the company’s directors, Stephen Luczo, invested over two and a half million dollars of his own money in AT&T, in an ‘informative’ trade, meaning that it reflects his sentiment on the stock. Individual investors have also been increasing their holdings. The stock has a Neutral Smart Score of 7.
EOG Resources (NYSE: EOG)
Dividend yield: 5.72%
Ex-dividend date: Jan 13, 2022
Payout ratio: 74.13%
Payout date: Jan 28, 2022
EOG Resources is a crude oil and natural gas company with reserves in the U.S. and Trinidad. EOG stock has a Strong Buy analyst rating consensus based on 16 Buy and 3 Hold ratings. Looking at analysts’ price targets, the average of $115.21 indicates 27.70% upside over the next 12 months. Across the board experts are bullish on the stock. These experts include including financial bloggers, hedge fund managers, and corporate insiders. Individual investors agree with the experts: in the past month there has been a 15.9% increase in the number of portfolios holding the stock. They will benefit from the current $0.75 dividend amount per share, which translates to 5.72% yield. EOG has a perfect Smart Score of 10.
Oxford Lane Capital (NASDAQ: OXLC)
Dividend yield: 10.97%
Ex-dividend date: Jan 14, 2022
Payout ratio: 49.88%
Payout date: Feb 15, 2022
Oxford Lane is a closed-end management investment company. It offers its investors a generous monthly dividend, with its dividend yield close to 11%. Only two Wall Street analysts have rated the Stock, and both awarded it a Buy rating. Their average price target of $8.75 indicates over 16% upside. Investors have been adding the stock to their portfolios; particularly the top-performing investors have shown an 8% increase in the number of portfolios holding the stock in the past 30 days. Financial bloggers are also Bullish. The stock does not have enough key information to give it a Smart Score, however, the stock analysis provides a useful visual overview.
Stellus Capital (NYSE: SCM)
Dividend yield: 6.13%
Ex-dividend date: Jan 27, 2022
Payout ratio: 86.43%
Payout date: Apr 15, 2022
Stellus Capital is a lower-middle-market private investment firm with approximately $2.1 billion of assets under management. As with Oxford Lane, only two analysts have rated the stock, and both say Buy. Their average price target of $15.25 suggests almost 16% upside potential. With positive blogger sentiment and insider transactions, alongside positive techincals and fundamentals, the stock has the maximum Smart Score of 10.
Dividend Yield & Dividend Payout
Companies determine dividend amounts per share. This can make it difficult for investors to compare the best dividend stocks. Imagine you invest $1,000 in 2 companies. One has shares that trade for $10, the other has shares that trade for $500. Both offer investors $2 per share in dividend payments. The solution to this is dividend yield. It shows dividend payment relative to the share price as a percentage.
See Also: Dividend Yield Calculator
It is worth knowing the payout ratio of a dividend stock. This is the proportion of earnings a company pays out as dividends. If the ratio is over 100% this may mean that there is a possibility that a company will reduce its dividends.
See which other stocks have an ex-dividend date in January 2022.
Disclaimer: The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.