In this article, we discuss 11 best March dividend stocks to buy. You can skip our detailed analysis of dividend capture strategy and performance of dividend stocks, and go directly to read 5 Best March Dividend Stocks To Buy.
Dividend investing is highly favored among investors because of its potential for long-term benefits. However, there's another approach called the dividend capture strategy, which some investors employ to focus on short-term gains. This strategy involves frequent trading with the goal of capturing the cash payouts from more stocks than one would typically receive through traditional buy-and-hold methods. Unlike the conventional approach where investors hold onto stocks for longer periods, dividend capture involves swiftly moving in and out of various stocks to secure a continuous flow of dividends. It's essentially an income-oriented trading strategy that aims to generate dividends from a diverse range of stocks over short timeframes, rather than relying on periodic payouts from a select few stocks.
Regardless of the specific investment approach, dividend stocks have consistently captured investors' attention due to their reliable returns over time. Particularly, companies that have consistently increased their dividend payouts have historically outperformed other asset classes. As indicated in a report from Nuveen, over extended periods, companies that consistently raise dividends or initiate dividend payments have demonstrated superior returns with lower risk, as measured by standard deviation, compared to companies that maintain, reduce, or eliminate their dividends. Walmart Inc. (NYSE:WMT), Johnson & Johnson (NYSE:JNJ), and AbbVie Inc. (NYSE:ABBV) are some of the best dividend growth stocks to invest in. Aside from focusing on the growth of dividends, the report also highlighted the significance of payout ratios. Companies that are barely earning enough to cover dividend payments or those allocating most of their earnings as dividends might face challenges from competitors. This is because their cash flow might not be adequate to sustain their operations effectively. Moreover, companies with high dividend yields, particularly those with high payout ratios, could face risks of limited future growth. This situation could potentially endanger both the appreciation of share prices and the growth of dividends.
Fortunately, the S&P 500's dividend payout ratio is currently lower than its typical long-term average, and consensus forecasts predict an 11% growth in earnings per share for 2024. These factors are expected to contribute to attractive returns for shareholders. Furthermore, companies are maintaining substantial cash reserves on their balance sheets, totaling $1.9 trillion as of September 30, 2023, which is close to the highest levels seen in the past twenty years. Additionally, with equity market valuations surpassing their long-term averages, there's a likelihood that corporate management teams will prioritize dividend growth in 2024 over stock buybacks as a means of rewarding shareholders, given the elevated valuations.
Against commonly held beliefs, dividend growth from companies showed resilience throughout 2023, spanning various sectors and geographical regions, as reported by Janus Henderson. However, certain sectors such as mining, select energy stocks, and chemicals experienced challenges in this regard. Notably, the market observed a higher standard of dividend growth, with a reduced dependence on one-time special dividends and exchange rate fluctuations, which were prominent features in 2022. The firm maintained a positive outlook on dividends, although it exercised caution as companies and economies adapt to higher interest rates. It emphasized that dividends have demonstrated less volatility compared to earnings over time, with the majority of companies consistently increasing dividends annually. Furthermore, dividends exhibit less cyclical behavior than commonly perceived by investors. Sectors such as consumer staples, utilities, pharmaceuticals, and telecommunications are known for their consistent dividend payouts, offering a protective cushion against sectors more susceptible to economic fluctuations, such as banks, energy, and mining. Taking an active and diversified approach to income investing across various regions and sectors can provide reassurance during periods of market uncertainty and facilitate the accumulation of long-term wealth.
In view of this, we will discuss some of the best dividend stocks to buy in March.
11 Best March Dividend Stocks To Buy
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Our Methodology:
For this list, we selected dividend stocks that will trade ex-dividend in March 2024. Ex-dividend date indicates the cutoff day to buy a stock to receive its upcoming dividend payment. We also measured hedge fund sentiment around each stock, according to Insider Monkey’s Q4 2023 data of 910 elite funds. The list is ranked in ascending order of their ex-dividend dates. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here).
Stanley Black & Decker, Inc. (NYSE:SWK) is a diversified global provider of hand tools, power tools, and related accessories, mechanical access solutions, electronic security solutions, engineered fastening systems, infrastructure solutions, and more. On February 27, the company declared a quarterly dividend of $0.81 per share, which was in line with its previous dividend. It is one of the best dividend stocks on our list as the company has been paying regular dividends to shareholders for the past 156 years while maintaining a 56-year streak of consistent dividend growth. The stock has a dividend yield of 3.62%, as of March 5.
The number of hedge funds tracked by Insider Monkey owning stakes in Stanley Black & Decker, Inc. (NYSE:SWK) jumped to 32 in Q4 2023, from 19 in the previous quarter. The collective value of these stakes is over $416.6 million.
Evergy, Inc. (NASDAQ:EVRG) is a Missouri-based electric utility company that provides electricity generation, transmission, and distribution services to residential, commercial, industrial, and wholesale customers. The company declared a 5% hike in its quarterly dividend to $0.6425 per share on February 29. This was the company's 19th consecutive year of dividend growth, which makes EVRG one of the best dividend stocks on our list. The stock's dividend yield on March 5 came in at 5.14%.
At the end of Q4 2023, 39 hedge funds tracked by Insider Monkey reported having stakes in Evergy, Inc. (NASDAQ:EVRG), up from 34 in the previous quarter. The total value of these stakes is more than $1 billion. Among these hedge funds, Point72 Asset Management was the company's leading stakeholder in Q4.
9. Old Republic International Corporation (NYSE:ORI)
Ex-Dividend Date: March 8
Old Republic International Corporation (NYSE:ORI) will be trading ex-dividend on March 8. The diversified insurance company provides property and casualty insurance coverage to individuals, businesses, and institutions. It currently pays a quarterly dividend of $0.265 per share, having raised it by 8.2% on March 2. Through this increase, the company achieved its 44th annual consecutive dividend growth. With a dividend yield of 3.63% as of March 5, ORI is one of the best dividend stocks on our list.
As of the close of Q4 2023, 25 hedge funds in Insider Monkey's database held stakes in Old Republic International Corporation (NYSE:ORI), growing from 21 in the preceding quarter. These stakes are collectively valued at over $287.5 million.
Following in the footsteps of Meta Platforms, Inc. (NASDAQ:META), Salesforce, Inc. (NYSE:CRM) also recently announced its first-ever dividend. The cloud-based software company concluded its fiscal year 2024 on a high note, showcasing its prowess in effectively managing the balance between increasing sales and profits. Furthermore, the enterprise software leader announced enhancements to its stock buyback initiative. The company offers a quarterly dividend of $0.40 per share for a dividend yield of 0.51%, as of March 5.
Salesforce, Inc. (NYSE:CRM) was a part of 131 hedge fund portfolios at the end of Q4 2023, growing significantly from 122 in the previous quarter, as per Insider Monkey's database. The stakes owned by these hedge funds have a collective value of roughly $15 billion. With over 2.1 million shares, AQR Capital Management was the company's leading stakeholder in Q4.
Pool Corporation (NASDAQ:POOL) is next on our list of the best dividend stocks that will be trading ex-dividend in March. The company serves a diverse customer base that includes swimming pool builders, retailers, and service companies. It has been rewarding shareholders with growing dividends for the past 12 years and currently offers a quarterly dividend of $1.10 per share. As of March 5, the stock has a dividend yield of 1.09%.
At the end of December 2023, 42 hedge funds tracked by Insider Monkey held stakes in Pool Corporation (NASDAQ:POOL), up from 41 in the previous quarter. The overall value of these stakes is over $767 million.
Linde plc (NASDAQ:LIN) ranks sixth on our list of the best dividend stocks going ex-dividend in March. The multinational industrial gases and engineering company declared a 9% hike in its quarterly dividend to $1.39 per share. This marked the company's 29th consecutive year of dividend growth. The stock's dividend yield on March 5 came in at 1.22%.
Insider Monkey's database of Q4 2023 indicated that 74 hedge funds owned stakes in Linde plc (NASDAQ:LIN), up from 71 in the previous quarter. The consolidated value of these stakes is nearly $4 billion. Scopus Asset Management owned a LIN stake worth over $25.7 million, becoming the company's leading shareholder in Q4.
