3 Dividend-Boosting Stocks That Could Have More Bumps Ahead

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Numerous dividend stars could face price return headwinds. Stay away from these three assets at all costs. Realty Income Corporation (NYSE:O): Declining capitalization rates and occupancy could ...

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Stay away from these three assets at all costs.\nRealty Income Corporation (NYSE:O): Declining capitalization rates and occupancy could ...</p>\n\n<a href=\"https://investorplace.com/2024/03/3-dividend-boosting-stocks-that-could-have-more-bumps-ahead/\">Source Link</a>\n\n</div>\n","source":"investorplace_stock_picks","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>3 Dividend-Boosting Stocks That Could Have More Bumps Ahead</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\n3 Dividend-Boosting Stocks That Could Have More Bumps Ahead\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-03-28 02:04 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://investorplace.com/2024/03/3-dividend-boosting-stocks-that-could-have-more-bumps-ahead/><strong>InvestorPlace</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Numerous dividend stars could face price return headwinds. Stay away from these three assets at all costs.\nRealty Income Corporation (NYSE:O): Declining capitalization rates and occupancy could ...</p>\n\n<a href=\"https://investorplace.com/2024/03/3-dividend-boosting-stocks-that-could-have-more-bumps-ahead/\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4588","symbol_name":"碎股","start_time":0,"source_url":"https://investorplace.com/2024/03/3-dividend-boosting-stocks-that-could-have-more-bumps-ahead/","article_id":"2422403941","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2422403941","pubTimestamp":1711562646,"sourceInfo":{"source_id":"investorplace_stock_picks","name":"InvestorPlace stock picks"},"weMediaInfo":null,"summary":"Dividend-paying stocks don't always provide sure returns. Stay away from O, BTI, and ESEA to avoid unrealized losses.","collect":0,"end_time":0,"defaultTopTitle":"investorplace.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4588":"碎股","BTI":"英美烟草","BK4075":"烟草","BK4021":"海运","ESG":"FlexShares STOXX US ESG Select Index Fund","BK4080":"零售业房地产投资信托","BK4231":"零售房地产信托","O":"Realty Income Corp","REIT":"ALPS Active REIT ETF","BK4585":"ETF&股票定投概念","ESEA":"Euroseas Ltd"},"translate_title":"3只股息增加的股票可能会有更多的上涨","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"BTI":1,"ESEA":1,"ESG":1,"O":1,"REIT":1},"content_text":"Numerous dividend stars could face price return headwinds. Stay away from these three assets at all costs.\nRealty Income Corporation (NYSE:O): Declining capitalization rates and occupancy could stretch O REIT’s book value if its dividend payout ratio is maintained.\nBritish American Tobacco (NYSE:BTI): A hard pivot raises dividend sustainability questions.\nEuroseas (NASDAQ:ESEA): Cyclicality could have the upper hand despite Euroseas’ latest dividend increase.\n\n\n\n\n\n \n\nSource: Shutterstock\n\n\n\nDividend investing is a spectacular way of accumulating wealth, especially if you locate your dividend stocks in tax-efficient accounts. In fact, I’d argue that nimble dividend investing would beat capital gains investing in today’s economy.\nDespite the allure of dividend investing, risks are ever-present. For example, many companies sustain their dividend payouts to satisfy investors while depleting their book values and, in turn, their stock’s fair value. Another risk worth considering is that some companies pay dividends instead of reinvesting in their businesses, consequently driving down their future growth prospects.\nThis article focuses on three dividend-boosting stocks that face price risk due to the aforementioned reasons. Let’s discuss each in depth.\nRealty Income Corporation (O)\nSource: ShutterstockRealty Income Corporation (NYSE:O) isn’t a stock but instead a real estate investment trust (REIT). The REIT invests in retail properties located in the United States, United Kingdom and Europe. Realty Income Corporation’s property portfolio has yielded tremendous success, realizing 6.2% in annual funds from operations per share growth since 2012.\nAlthough historically a solid income-based investment opportunity, O REIT’s recently announced 124th dividend increases could soon become a burden. What’s my basis? Well, O REIT faces systematic headwinds. For example, due to disinflation, U.S. retail capitalization rates are forecasted to recede. In addition, the Atlanta Federal Reserve’s GDPNow projects an economic slowdown to surface in late 2024, which may impair O REIT’s asset base.\nFurthermore, O REIT has structural concerns. Realty Income released its fourth-quarter earnings last month, revealing a 20-basis-point quarterly drop in occupancy. In addition, O REIT raised $1.6 billion in common stock equity during its fourth quarter, raising concerns about its internal liquidity.\nLastly, key metrics suggest O REIT is fairly valued. In particular, its price-to-funds from operation ratio of 12.92x is above its five-year average of 12.55x. Moreover, its forward dividend yield of 5.86% will likely dent the REIT’s book value, given that O REIT’s funds available for distribution payout ratio is elevated at 76.10%.\nIt’s time to stay away from O REIT for the time being.\nBritish American Tobacco (BTI)\nSource: DutchMen / Shutterstock.comI held an optimistic view of British American Tobacco (NYSE:BTI) stock for the better part of three years. However, I’ve given up on it as BTI faces numerous fundamental challenges. Moreover, the company’s poor environmental, social and governance (ESG) score adds synthetic demand-side concerns to its stock.\nLet’s delve into a few of British American Tobacco’s fundamental headwinds to set a baseline.\nBritish American Tobacco’s projected organic growth until 2026 sits between 3% and 5%. Sure, that sounds respectable, but the company’s real growth factor could be flat if inflation is backed out of the equation. Much of the firm’s slowing growth is due to softer consumption of combustible products and illicit trade in some of British American Tobacco’s primary sales areas. British American Tobacco is pivoting toward non-combustible products such as vapes and tobacco-free nicotine pouches. However, beware that numerous non-combustible products might be a temporary trend.\nA newly announced $2 million investment in Open Book Extracts, a U.S.-based Cannabanoid manufacturer, highlights British American Tobacco’s pivot into modern growth industries. However, I’m worried about the company’s pivot. In truth, its contemporaneous dividend yield of 9.78% will likely coalesce with the aforementioned and drive its stock price down.\nEuroseas (ESEA)\nSource: VolodymyrT / Shutterstock.comESEA (NASDAQ:ESEA) stock has drifted up by nearly 30% in the past six months, but it’s time for mean reversion to play its hand. Euroseas, a Greek container shipping company, has a fleet of 20 vessels spanning feeder and intermediate containerships.\nAlthough Euroseas is a promising shipping company, it is highly cyclical, meaning its stock fluctuates throughout the economic cycle. I foresee a slowdown in global shipping unfolding in late 2024 due to a blip in the economy and rising geopolitical tensions. Euroseases’ fourth-quarter results echoed my outlook as the firm missed its revenue target by $49.1 million amid subdued charter rates. Moreover, Euroseas’ earnings settled 24 cents below target, suggesting cost cutting is out of the equation for the time being. In essence, key variables indicate that Euroseas is due for a cyclical correction.\nIn fairness, Euroseas does reward its shareholders equitably. The company raised its dividend by 20%, resulting in a forward dividend yield of around 7.06%. However, its high dividend yield could be its downfall. Investors will likely capture this quarter’s dividend and divest from the stock due to cyclical concerns.\nESEA is too risky, in my view.\nOn the date of publication, Steve Booyens did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.\nSteve Booyens co-founded Pearl Gray Equity and Research in 2020 and has been responsible for institutional equity research and PR ever since. Before founding the firm, Steve spent time working in various finance roles in London and South Africa. He holds an MSc in Investment Banking from Queen Mary – University of London. Furthermore, Steve has passed CFA Levels 1 & 2 and is working toward his Ph.D. in Finance. His articles are published on various reputable web pages such as Seeking Alpha, TipRanks, Yahoo Finance, and Benzinga. Steve’s articles on InvestorPlace form an interesting juxtaposition between mainstream opinion and objective theory. Readers can expect coverage on frequently traded stocks, REITs, fixed-income funds, CEFs, and ETFs.Dividend Stocks\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\nSubmit\n\n\n\n\n\n\n\nArticle printed from InvestorPlace Media, https://investorplace.com/2024/03/3-dividend-boosting-stocks-that-could-have-more-bumps-ahead/.\n©2024 InvestorPlace Media, LLC","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2422403941"}