The practice of paying dividends involves a company distributing a portion of its earnings back to its shareholders. Typically in the form of cash or additional shares. This is one way a company can return capital to its investors and it is particularly appreciated by those who seek regular income, such as retirees. Dividends can serve as an indicator of a company’s financial health. While at the same time also providing investors with an income stream.
Investing in dividend-paying stocks can be an effective strategy to generate passive income and complement capital gains. This can happen from rising share prices. Furthermore, it can provide a buffer during market downturns. As these stocks tend to be less volatile and belong to companies with more stable and mature businesses. However, investors need to consider factors beyond just a high dividend yield. They should also look at the company’s payout ratio, dividend growth rate, and whether the company’s earnings can sustain the dividend payment.
Dividend investing focuses on accumulating stocks that issue high dividends, which can be reinvested to purchase more shares, potentially leading to exponential growth, a concept known as compounding. This approach could be beneficial for long-term growth, and it’s an investing strategy commonly employed by those looking to build wealth over time or create a steady income stream during retirement. Moreover, here are two dividend-paying stocks to watch in the stock market this week.
Dividend Stocks To Watch Right Now
Chevron Corporation (CVX Stock)
First up, Chevron Corporation (CVX), is a significant player in the energy sector. The company specializes in the discovery, extraction, and conveyance of oil and natural gas. Furthermore, it places considerable investment in sustainable energy avenues, including solar and wind energy. Currently, CVX offers its shareholders an annual dividend yield of 3.95%.
Late last month, Chevron announced the date it will release its second quarter 2023 financial results. Diving in, the company reported that it will release its Q2 2023 financial and operating results on Friday, July 28, 2023, ahead of the stock market opening.
Year-to-date, shares of CVX stock have dropped by 12.20% so far. Meanwhile, during Thursday’s mid-morning trading session, Chevron stock is trading lower on the day by 2.37% at $152.61 per share.
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Walmart (WMT Stock)
Next, Walmart Inc. (WMT), is a global powerhouse in retail. The company manages a network of discount stores, supercenters, and e-commerce platforms. They offer a broad variety of products at competitive prices to cater to consumers’ diverse needs. Notably, by the end of fiscal 2022, Walmart boasted over 10,500 stores under 46 different brand names. Today, Walmart has an annual dividend yield of 1.45%.
Back in May, Walmart released its most recent Q1 2024 financial results. Getting right into it, the retail giant posted a Q1 2024 beat reporting earnings of $1.47 per share, and revenue of $152.3 billion. This is versus analysts’ consensus estimates which were earnings per share of $1.32 per share, along with revenue of $148.5 billion. As a result, revenue increased by 7.6% compared to the same period, the previous year.
In 2023 so far, shares of Walmart stock have increased by 9.48% year-to-date. While, during Thursday’s mid-morning trading action, WMT stock is trading modestly lower on the day by 0.57% at $157.21 a share.