Dividend-paying stocks are a great way to generate passive income and can be considered a safe bet in the current uncertain market situation. This is where the TipRanks Stock Screener tool comes in handy. Today, we have shortlisted two stocks – New York Community (NYSE:NYCB) and Energy Transfer (NYSE:ET) – that offer a dividend yield of more than 5% and have received Buy recommendations from the top Wall Street analysts. Moreover, these stocks carry an Outperform Smart Score.
New York Community Bancorp, Inc.
For the past 29 years, New York Community has been consistently paying dividends. Further, NYCB’s attractive dividend yield stands at 7.5%, above the financial sector’s average yield of 2.1%. The bank’s cash position remained strong, with an operating cash flow of $1.03 billion and a free cash flow of $1.02 billion as of December 31, 2022.
Two weeks ago, Jefferies analyst Casey Haire upgraded NYCB stock’s rating to Buy from Hold and raised the price target to $11 from $10.
The analyst believes that the bank’s balance sheet significantly improved after acquiring roughly $34 billion of Signature Bank’s (SBNY) deposits last month. Additionally, Haire believes that NYCB has the capacity to compete with its peers.
Is NYCB a Good Stock to Buy?
Wall Street is optimistic about New York Community, giving it a Strong Buy consensus rating based on 12 Buys and three Holds. The average NYCB stock price target of $10.93 implies upside potential of 21.2% from here. Shares are up 6.1% over the past six months.
On a positive note, the stock has a Smart Score of “Perfect 10” on TipRanks. Note that shares with a “Perfect 10” score have historically outperformed the S&P 500 Index (SPX).
Energy Transfer LP
Energy Transfer has raised its payout by nearly 75% over the past year. With this hike, the midstream giant restored its distribution level to where it was in the first half of 2020. Furthermore, the stock has a rock-solid dividend yield of 7.8%. Energy Transfer’s payouts seem sustainable due to its acquisition of Lotus Midstream and will probably contribute to an increase in cash flow.
Last week, analyst Marc Solecitto of Barclays maintained a Buy rating on the stock and raised the price target to $16 from $15. Solecitto thinks that the share price of Energy Transfer is being driven by macroeconomic factors.
Is ET a Buy Right Now?
The Street is highly optimistic about Energy Transfer, giving it a Strong Buy consensus rating based on seven unanimous Buys. The average ET stock price target of $17 implies 33.1% upside potential from here.
Furthermore, Energy Transfer has a Smart Score of nine on TipRanks.
Ending Thoughts
These stocks might be a good addition for investors who want to create a reliable passive income stream. For both ET and NYCB, the fundamentals are strong and the cash flows are robust. Interestingly, top analysts expect these stocks to register gains over the next 12 months.
