While the economy contracted for two consecutive quarters, the momentum of the services sector and strong job growth in July could cool off the current recessionary concerns. However, the strong data could encourage the Fed to consider more extensive rate hikes, eliminating the possibility of a soft landing.
With inflation reports due this week, the markets will likely remain volatile in the near term. While July's Consumer Price Index (CPI) is expected to decline marginally, analysts do not expect the reading to bring any significant relief. So, it could be wise to seek shelter under dividend-paying stocks with solid fundamentals to cushion your portfolios against the potential market volatility.
Investors’ interest in high dividend-yielding stocks is evident from the Vanguard High Dividend Yield ETF’s (VYM) 3.99% gains over the past month.
We believe quality dividend stocks Natural Resource Partners L.P. (NRP), Sisecam Resources LP (SIRE), and Vodafone Group Plc (VOD) are well-positioned to help investors dodge the current market fluctuations and generate stable returns.
Natural Resource Partners L.P. (NRP)
NRP owns, manages, and leases a diversified portfolio of mineral properties in the United States, including interests in coal, soda ash, trona, and other natural resources. It leases a portion of its reserves in exchange for royalty payments and owns and leases transportation and processing infrastructure related to coal properties.
NRP will pay a $0.75 quarterly cash dividend on August 23, 2022. The stock pays a $3 per share dividend annually, translating to a 6.72% yield. Its four-year average dividend yield is 8.5%. The company’s dividend has grown at a 3.1% rate over the past five years.
For the fiscal 2022 second quarter ended June 30, 2022, NRP’s sales increased 159.5% year-over-year to $99.93 million. The company’s income from operations came in at $78.98 million, up 215.5% from the prior-year period.
While its net income increased 334.4% year-over-year to $6.91 billion, its EPS rose 487.5% to $3.29. As of June 30, 2022, the company had $59.36 million in cash and cash equivalents.
Analysts expect the company to report revenue of $208.10 million for fiscal 2022 ending December 31, 2022, indicating a rise of 7.1% from the prior-year period. Over the past month, the stock has gained 19.5% to close the last trading session at $44.64.
NRP’s POWR Ratings reflect this promising outlook. It has an overall A rating, which equates to Strong Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 distinct factors, with each factor weighted to an optimal degree.
The stock has a B grade for Momentum, Sentiment, and Quality. Click here to see the additional ratings for NRP’s Growth, Value, and Stability. NRP is ranked #3 of 12 stocks in the A-rated MLPs - Other industry.
Sisecam Resources LP (SIRE)
SIRE engages in the trona ore mining and soda ash production businesses internationally. It processes trona ore into soda ash, a raw material in flat glass, container glass, detergents, chemicals, paper, and other consumer and industrial products. It holds approximately 23,500 acres of leased and licensed subsurface mining areas in the Green River Basin of Wyoming.
SIRE will pay a $0.50 quarterly cash dividend on August 23, 2022. The stock pays a $1.49 per share dividend annually, translating to an 8.68% yield. Its four-year average dividend yield is 7.1%.
SIRE’s net sales for its fiscal 2022 second quarter ended June 30, 2022, increased 56.7% year-over-year to $189.10 million. The company’s operating income came in at $32.60 million, up 292.8% from the prior-year period.
Its net income came in at $31.20 million, representing a 358.8% rise from the prior-year period. SIRE’s EPS increased 406.6% year-over-year to $0.76. It had $3.40 million in cash and equivalents as of June 30, 2022.
The consensus revenue estimate of $2.44 billion for fiscal 2022 ending December 31, 2022, indicates a 352.3% year-over-year improvement. Over the past month, the stock has gained 28.4% to close the last trading session at $23.04.
SIRE’s POWR Ratings reflect its solid prospects. The stock has an overall A rating, equating to Strong Buy in our proprietary rating system.
It has an A grade for Growth and a B grade for Value, Sentiment, Stability, and Quality. In addition to the POWR Ratings grades we have just highlighted, one can see SIRE’s Momentum ratings here. SIRE is ranked #1 of 89 stocks in the A-rated Chemicals industry.
Vodafone Group Plc (VOD)
Based in the U.K., VOD is an international telecommunication services provider that offers mobile services, fixed line services, including broadband, television (TV) offerings, and voice, convergence services, digital services, the Internet of Things (IoT), and financial services, which complements its connectivity business.
In addition, the company offers M-Pesa, an African payment platform, enabling money transfer, financial, business, and merchant payment services, and various services to operators. As of March 31, 2022, it had approximately 323 million mobile customers, 28 million fixed broadband customers, and 22 million TV customers.
VOD paid a $0.46 quarterly cash dividend on August 5, 2022. The stock pays a $0.91 per share dividend annually, translating to a 6.23% yield. Its four-year average dividend yield is 6.8%.
For its fiscal 2023 first quarter ended June 30, 2022, VOD’s total revenue grew 12.6% year-over-year to €11.28 billion ($11.51 billion). VOD’s total revenue for its fiscal 2023 first quarter ended March 31, 2022, grew 4% year-over-year to €45.58 billion ($46.50 billion). The company’s gross profit came in at €15.01 billion ($15.31 billion), indicating a 9.4% rise from the year-ago period.
Its adjusted operating profit came in at €6.69 billion ($6.83 billion), representing a 22.5% year-over-year improvement. VOD’s adjusted net profit came in at €3.74 billion ($3.81 billion), up 32.6% from the prior-year period. Its EPS increased 1786.8% year-over-year to 7.17 cents.
As of March 31, 2022, the company had €7.37 billion ($7.52 billion) in cash and cash equivalents. Over the past month, the stock has lost 4.5% to close the last trading session at $14.69.
VOD’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall B rating, which equates to Buy in our proprietary rating system.
It has an A grade for Growth and a B for Value and Stability. Click here to see the additional ratings for VOD (Sentiment, Quality, and Momentum). VOD is ranked #12 of 47 stocks in the A-rated Telecom - Foreign industry.
NRP shares were trading at $44.21 per share on Monday morning, down $0.43 (-0.96%). Year-to-date, NRP has gained 35.97%, versus a -11.63% rise in the benchmark S&P 500 index during the same period.
About the Author: Sweta Vijayan
Sweta is an investment analyst and journalist with a special interest in finding market inefficiencies. She’s passionate about educating investors, so that they may find success in the stock market.
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