November's 12 Reliable Retiree Dividend Stocks (Of 41)

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Foreword

This article is based on two Kiplinger investing articles aimed at retirees:

25 Stocks Every Retiree Should Own, by Charles Lewis Sizemore, CFA, published 7/2/19, features a “group of retirement stocks that includes both pure income plays and growth companies, with a focus on very-long-term performance and durability.”

20 Dividend Stocks to Fund 20 Years of Retirement, (yielding roughly 4% or higher), updated 8/5/20, by Brian Bollinger, “…should fund at least 20 years of retirement, if not more. They have paid uninterrupted dividends for more than 20 consecutive years, appear to have secure payouts and have the potential to collectively grow… dividends to protect investors’ purchasing power.”

Any collection of stocks is more clearly understood when subjected to yield-based (dog catcher) analysis; these Kiplinger reliable dividend stocks for retirees are perfect for the dogcatcher process. Here is the November 18 data for the 41 stocks in the Kiplinger-sourced collection, limited to 39 dividend producers.

The Ides of March 2020 plunge in the stock market took its toll but most of these retiree selections bounded back beyond broker targets.

The following 12 (as of November 18) live up to the Dogcatcher ideal of having annual dividends from a $1k investment exceed their single share prices: MMP, EPD, XOM, ENB, PBA, KMI, T, LTC, EBF, NNN, DOC, MNR, UGI. Many investors regard this condition as a buy signal.

Actionable Conclusions (1-10): Analysts Estimated 12.27% To 32.39% Net Gains For Ten Top Updated Reliable Retirement Dividend Dogs To November 2021

Six of ten top Kiplinger most reliable retirement stocks by yield were among the top ten gainers for the coming year based on analyst 1-year target prices. (They are tinted gray in the chart below). Thus, the yield-based forecast for these November dogs was graded by Wall St. Wizards as 60% accurate.

Projections were based on estimated dividends from $1,000 invested in each of the highest yielding stocks plus their aggregated one-year analyst median target prices, as reported by YCharts. Note: Target prices by lone analysts were not applied. Ten probable profit-generating trades projected to November 18, 2021 were:

Source: YCharts.com

Enbridge Inc. (ENB) was projected to net $398.73, based on dividends, plus the median of the target price estimates from twenty-six analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 22% under the market as a whole.

UGI Corp. (UGI) was projected to net $310.70 based on dividends, plus the median of target estimates from four brokers, less transaction fees. The Beta number showed this estimate subject to risk/volatility 6% less than the market as a whole.

Exxon Mobil Corp. (XOM) was projected to net $303.60, based on a median of target price estimates from twenty-five analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 29% more than the market as a whole.

Ennis Inc. (EBF) was projected to net $299.03, based on dividends, plus the median of target price estimates from two analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 53% less than the market as a whole.

Kinder Morgan Inc. (KMI) was projected to net $294.50, based on dividends, plus the median of target price estimates from twenty-four analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 1% under the market as a whole.

Magellan Midstream Partners (MMP) was projected to net $279.30, based on dividends, plus median target price estimates from twenty analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 3% less than the market as a whole.

CVS Health Corp. (CVS) was projected to net $262.00, based on dividends, plus the median of target price estimates from twenty-eight analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 31% less than the market as a whole.

Chevron Corp. (CVX) was projected to net $204.50, based on the median of target estimates from twenty-six analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 22% over the market as a whole.

AT&T Inc. (T) was projected to net $177.31, based on the median of target price estimates from thirty analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to risk/volatility 29% less than the market as a whole.

Monmouth Real Estate (MNR) was projected to net $176.81 based on the median of target price estimates from nine analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to risk/volatility 25% less than the market as a whole.

The average net gain in dividend and price was estimated at 27.07% on $10k invested as $1k in each of these ten stocks. These gain estimates were subject to average risk/volatility 12% under the market as a whole.

Source: happysplace.ca

The Dividend Dogs Rule

Stocks earned the “dog” moniker by exhibiting three traits: (1) paying reliable, repeating dividends, (2) their prices fell to where (3) yield (dividend/price) grew higher than their peers. Thus, the highest yielding stocks in any collection became known as “dogs.” More precisely, these are, in fact, best called, “underdogs”.

34 Kiplinger Reliable Retirement Dividend Stocks Show November Target Gains

Source: YCharts.com

39 Kiplinger Reliable Retirement Dividend Stocks Per November Yield

Source: YCharts.com

Actionable Conclusions (11-20): 10 Top Kiplinger Reliable Retirement Dividend Stocks By Yield For November

Top ten November Reliable Retirement Dividend stocks represented only three of eleven Morningstar sectors.

Seven energy stocks occupied first through sixth and eighth places: Magellan Midstream Partners LP [1], Enterprise Products Partners LP (EPD) [2], Exxon Mobil Corp. [3], Enbridge Inc. [4], Pembina Pipeline Corp. (PBA) [5], Kinder Morgan Inc. [6], and Chevron Corp. [8].

Seventh place went to a single communication services representative, AT&T Inc. [7].

Ninth and tenth places were claimed by two real estate sector representatives, LTC Properties Inc. (LTC) [9] and W.P. Carey Inc. (WPC) [10], to complete the updated reliable retirement top ten dividends by yield for November.

Actionable Conclusions: (21-30) Top Ten Reliable Retirement Dividend Dogs Showed 12.27%-32.39% Upsides While (31) Five Lowly Downsiders Fell in This November Report

Source: YCharts.com

To quantify top dog rankings, analyst mean price target estimates provide a “market sentiment” gauge of upside potential. Added to the simple high-yield metrics, analyst median target price estimates became another tool to dig out bargains.

Analysts Forecast A 12.88% Disadvantage For The 5 Highest Yield, Lowest Priced Of Top Ten Reliable Retirement Dividend Stocks For November 2021

Yield (dividend/price) results provided by YCharts did the ranking for these ten top reliable retirement dividend dogs.

Source: YCharts.com

As noted above, top ten Kiplinger reliable retirement dogs screened 11/18/20 showing the highest dividend yields represented three of eleven in the Morningstar sector scheme.

Actionable Conclusions: Analysts Predicted 5 Lowest-Priced Of The Top Ten Highest-Yield Reliable Retirement Dividend Dogs (32) Delivering 37.41% Vs. (33) 36.27% Net Gains by All Ten Come October 2021

Source: YCharts.com

$5,000 invested as $1k in each of the five lowest-priced stocks in the top ten reliable retirement dividend kennel by yield were predicted by analyst 1-year targets to deliver 12.88% LESS gain than $5,000 invested as $.5k in all ten. The ninth lowest priced selection, W.P. Carey Inc., was projected to deliver the best net gain of 39.87%

Source: YCharts.com

The five lowest-priced top-yield Kiplinger most-reliable retiree dividend dogs as of November 18 were: Kinder Morgan Inc., Enterprise Products Partners LP, Pembina Pipeline Corp., AT&T Inc., Enbridge Inc., with prices ranging from $13.76 to $29.08.

Five higher-priced Kiplinger top yield reliable retirement dividend dogs as of October 19 were: Exxon Mobil Corp., LTC Properties Inc., Magellan Midstream Partners LP, W.P. Carey Inc., Chevron Corp., whose prices ranged from $37.21 to $84.28.

The distinction between five low-priced dividend dogs and the general field of ten reflected Michael B. O’Higgins’ “basic method” for beating the Dow. The scale of projected gains based on analyst targets added a unique element of “market sentiment” gauging upside potential. It provided a here-and-now equivalent of waiting a year to find out what might happen in the market. Caution is advised, since analysts are historically only 20% to 80% accurate on the direction of change and just 0% to 20% accurate on the degree of change.

The net gain/loss estimates above did not factor in any foreign or domestic tax problems resulting from distributions. Consult your tax advisor regarding the source and consequences of “dividends” from any investment.

Afterword

If somehow you missed the suggestion of the fifteen stocks ripe for picking at the start of this article, here is a reprise of the list at the end:

The following 12 (as of November 18) live up to the Dogcatcher ideal of having annual dividends from a $1k investment exceed their single share prices: MMP, EPD, XOM, ENB, PBA, KMI, T, LTC, EBF, NNN, DOC, MNR, UGI. Many investors regard this condition as a buy signal.

Stocks listed above were suggested only as possible reference points for your Retirement stock purchase or sale research process. These were not recommendations.

Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsement to buy or sell any security. Prices and returns on equities in this article except as noted are listed without consideration of fees, commissions, taxes, penalties, or interest payable due to purchasing, holding, or selling same.

Graphs and charts were compiled by Rydlun & Co., LLC from data derived from www.indexarb.com; YCharts.com; finance.yahoo.com; analyst mean target price by Thomson/First Call in YahooFinance. Dog photo: vetstreet.com

Disclosure: I am/we are long T. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.