Investors seeking stable regular income along with capital gains could turn to NextEra Energy (NYSE:NEE), General Dynamics (NYSE:GD), and Air Products and Chemicals (NYSE:APD) stocks. These companies are Dividend Aristocrats (learn more about Dividend Aristocrats here). Moreover, Top Wall Street analysts maintain a bullish stance on these stocks.
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Before we learn why NEE, GD, and APD stocks are reliable bets, note that TipRanks identifies the top Wall Street analysts per sector, per timeframe, and against different benchmarks. The ranking reflects an analyst’s ability to deliver high returns through recommendations. Following the ratings, TipRanks’ algorithms calculate the statistical significance of each rating, the analysts’ overall success rate, and the average return.
NextEra Energy
NextEra Energy is a leading electric utility company that offers stability and income. It has an attractive long-term track record of creating solid shareholder value through consistent dividend hikes. Its growing earnings base enables it to return substantial cash to its shareholders.
For instance, NEE’s adjusted earnings per share have grown at a CAGR of 8.3% since 2007. During the same period, NEE’s dividends increased at a CAGR of 9.9%.
NextEra Energy’s continued investment to expand the retail rate base will support future revenue and earnings growth. At the same time, the company is poised to benefit from the Inflation Reduction Act (IRA) due to its growing portfolio of clean energy assets.
Is NextEra a Good Company?
NextEra Energy expects its adjusted EPS to increase at a CAGR of 6-8% through 2026. Furthermore, it expects to increase its dividend by 10%, at least through 2024. Its solid earnings growth potential and growing dividend make it a solid stock to invest in.
Furthermore, six out of seven top analysts covering NEE stock have rated it a Buy, translating into a Strong Buy consensus rating.
On June 7, Goldman Sachs analyst Carly Davenport initiated coverage of NextEra Energy. The analyst rated NEE stock a Buy due to the company’s above-average earnings growth rate, positive regulatory environment, and solid renewables portfolio. Davenport has a price target of $90.
Overall, analysts’ average price target of $89.71 implies 22.15% upside potential. Also, NEE stock offers a forward dividend yield of 2.55%.
General Dynamics
General Dynamics is an aerospace and defense company providing products and services in business aviation, land combat vehicles, weapon systems, ship construction and repair, and technology products. Thanks to its growing revenue, earnings, and cash flows, GD increased its dividend for 26 consecutive years.
This Dividend Aristocrat increased its quarterly dividend from $0.51 per share in 2012 to $1.32 per share in 2023. Further, it has paid more than $10.3 billion in dividends over the past decade.
The new contract wins, a company-wide backlog of $89.8 billion at the end of Q1, free cash flow generation, and solid operating performance position it well to continue to enhance its shareholders’ value through higher dividend payouts.
Is General Dynamics a Good Stock to Buy Right Now?
Citi analyst Jason Gursky expects a rally in defense-related stocks, including General Dynamics, as the debt ceiling deal will lead to continued growth in defense spending.
Overall, General Dynamics stock has a Strong Buy consensus rating based on seven Buy and one Hold recommendations from Top Wall Street analysts. These analysts’ average price target of $266.5 implies 26.3% upside potential from current levels. Further, GD stock offers a forward dividend yield of 2.5%.
Air Products and Chemicals
Air Products is a leading industrial gas and chemical company. Further, it provides clean hydrogen for global transportation and industrial markets, supporting the broader energy transition. Thanks to its ability to generate solid earnings growth, Air Products has enhanced its shareholders’ value through higher dividend payouts.
APD’s adjusted EPS has increased at a CAGR of 11% since 2014. Furthermore, its dividend grew at a CAGR of 10% during the same period. Overall, APD stock has increased its dividend for 41 consecutive years and offers a forward yield of 2.4%.
What is the Price Target for APD Stock?
The company’s growing earnings base and energy transition opportunities position it well to deliver higher dividends in the coming years. On June 13, Citi analyst Patrick Cunningham initiated coverage of APD stock with a Buy recommendation.
Overall, four out of five Top Wall Street analysts have rated Air Product stock a Buy, reflecting a Strong Buy consensus rating. Analysts’ average price target of $332 implies 13.96% upside potential.
