In This Article:
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(0:45) - Searching For Stocks That Have Strong Income
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(7:35) - Tracey’s Top Stock Picks
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(24:00) - Episode Roundup: ADM, UBS, BIP
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Podcast@Zacks.com
Welcome to Episode #395 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.
Recently, a podcast fan wrote in to Tracey requesting a show on value stocks that also pay big dividends.
For those investors looking for income, that would be the best of all worlds. A cheap stock that will pay you a lot of cash.
Screening for Top Value Stocks with Dividends
To find value stocks, Tracey used a price-to-earnings (P/E) ratio of 15 or under. A P/E of 15 or lower is usually considered to be a value stock.
For the dividend, the screen looked for a 3% yield or higher, which Tracey considers to be “juicy” for investors.
To find top stocks, the screen included Zacks Ranks of #1 (Strong Buy) or #2 (Buy). These are the highest Zacks Ranked stocks and usually indicates analysts are raising their earnings estimates.
This screen returned 113 stocks with many being in the usual “high dividend” categories including banks, real estate investment trusts (REITs), and master limited partnerships (MLPs.)
3 Value Stocks with Juicy Dividends
1. Archer Daniels Midland, Inc. (ADM)
Archer Daniels Midland had the coveted Zacks #1 (Strong Buy) rank when the podcast was recorded but that has dropped to a #2 (Buy) stock. 2025 looks challenging as the company guided light for the year due to weaker market fundamentals and ongoing biofuels and trade policy uncertainties.
But Archer Daniels Midland is cheap, with a forward P/E of just 10.4. It also recently raised its dividend by 2%. Archer Daniels Midland’s dividend is now yielding 4.2%.
Should a nutrition company like Archer Daniels Midland be on your dividend short list?
2. Brookfield Infrastructure Partners L.P. (BIP)
Brookfield Infrastructure Partners is a REIT which owns global infrastructure networks in energy, water, freight, passengers, and data. In its Q4 earnings press release, Brookfield Infrastructure Partners said 2025 was off to a great start.
Earnings are expected to rise 10.6% in 2025. Brookfield Infrastructure Partners is cheap with a forward P/E of 9.5. It is shareholder friendly and aims to grow its distribution yield by 5% to 9% annually.
Is a REIT such as Brookfield Infrastructure Partners the perfect way to play the global AI infrastructure build-out and get income?