Don't Overlook These Low-Risk High-Dividend Yielding Stocks

Image: Bigstock

Gazing at the Zacks Rank #1 (Strong Buy) list, there are a few appealing stocks with Beta ratios under 1.0, which historically indicates they should be less volatile than the broader market.

Given the strong rally in the S&P 500 and the Nasdaq over the last year, it may be wise to consider stocks that should be less volatile and more likely to sustain during market corrections. Even better is when these low beta stocks have dividend yields over 5%. Here are a few such stocks to consider.

Organon & Co (OGN - Free Report)

Out of the medical sector, Organon’s stock currently has a Beta ratio of 0.79 and an annual dividend yield of 6.04%. Focused on women’s health throughout their life cycle, Organon’s topped its fourth quarter earnings expectations by 10% last Thursday, with EPS at $0.88 a share.

The company’s outlook is also attractive, with annual earnings expected to rise 3% in fiscal 2024 and projected to spike another 3% in FY25 to $4.41 per share. Plus, earnings estimate revisions for FY24 and FY25 have continued to trend higher over the last 60 days.

This makes Organon’s stock look like a steal, as it has recently been seen trading at around $18 and just 4.3X forward earnings. Rising earnings estimates also provide reason to believe OGN shares should have more short-term upside, with Organon’s stock boasting an “A” Zacks Style Scores grade for Value in addition to its strong buy rating.  

Zacks Investment Research

Image Source: Zacks Investment Research

Patria Investments Limited (PAX - Free Report)

Checking in with a Beta of just 0.58 is Patria Investments Limited, a private markets investment firm operating principally in Latin America. Patria’s stock has a whopping 10.53% annual dividend yield that towers over the S&P 500’s 1.42% average and the Zacks Financial-Investment Management industry average of 3.08%. More intriguing, Patria has increased its payout seven times in the last five years with an annualized dividend growth rate of 12.67% during this period.   

It's also noteworthy that Patria comfortably surpassed its Q4 earnings expectations last Thursday as well, with EPS of $0.47 per share coming in 38% better than estimates of $0.34 a share. Better still, Patria is expected to post high, double-digit percentage growth on its top and bottom lines in FY24.

Zacks Investment Research

Image Source: Zacks Investment Research

Brookline Bancorp (BRKL - Free Report)

Rounding out this list, we’ll stay in the finance sector with Brookline Bancorp, a holding company for Brookline Bank, Bank Rhode Island (BankRI), and PCSB Bank, among other subsidiaries. Brookline’s stock has a Beta of 0.78 and an annual dividend yield of 5.54%, with the company increasing its payout six times in the last five years.

Reporting its Q4 results in late January, its EPS of $0.26 per share beat estimates by 13%. Furthermore, while annual earnings are expected to dip -7% this year, FY25 EPS is projected to rebound and climb 26% to $1.23 per share. More promising is that FY24 and FY25 EPS estimates are nicely up over the last 30 days following Brookline’s Q4 earnings beat.

Zacks Investment Research

Image Source: Zacks Investment Research

Bottom Line

Now could be a good time to buy these highly-ranked stocks, with earnings estimate revisions likely to keep ticking up after their favorable Q4 results, which makes their high dividend yields and low beta ratios more attractive.

More By This Author:

IBM Exceeds Market Returns: Some Facts to Consider
Time To Buy Walmart's Stock As 3-1 Split Approaches?
5 Solid Stocks To Buy On Jump In Online Grocery Sales

Disclosure: contains statements and statistics that have been obtained from sources believed to be reliable but are not guaranteed as to accuracy or completeness. References to any ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.