Major indexes on Wall Street have hit multiple new all-time closing highs over the past month. However, stocks have shown volatility over the past couple of weeks, disrupting the rally. The ongoing volatility is being fueled by uncertainty over the impact of President Donald Trump’s new tariffs and concerns about a potential rise in inflation.
These uncertainties could keep markets volatile for a longer period. Given this situation, an astute investor would choose to keep a close watch on dividend-paying stocks. This is because dividend stocks, which are backed by a strong business model and a proven history of success, tend to hold up well against market volatility.
They not only offer a steady income stream but also help reduce the risk of sharp price swings. Moreover, dividend-paying companies have historically outperformed their non-dividend counterparts during times of market instability. Four such stocks are: Pan American Silver Corp. PAAS, Carlisle Companies Incorporated CSL and DHT Holdings, Inc. DHT.
Volatility Returns to Wall Street
Major indexes have remained volatile over the past couple of weeks. Trump’s new tariffs took effect after the deadline for trade negotiations ended on Aug. 7. However, investors remain uncertain about how these new tariffs will impact the economy.
Several economists believe that higher prices of goods will lead to increased inflation. This was seen in June, when inflation rose as the price of consumer goods increased, which experts attributed to the first round of tariffs imposed by Trump in April.
Market participants are forecasting a further rise in inflation in July as they eagerly await the release of the consumer price index (CPI) reading on Tuesday. The producer price index (PPI) reading will be out on Thursday, and both reports will play a key role in determining the future path of interest rates ahead of the Federal Reserve’s September meeting. Higher-than-expected inflation readings could slow the market’s momentum.
The Federal Reserve has adopted a wait-and-see approach before going ahead with any rate cut, as officials, too, are uncertain about how tariffs will impact inflation. This saw the central bank leaving interest rates unchanged in its current range of 4.25-4.5%, which has remained so since last December.
A delay in the interest rate cut beyond September could keep markets volatile for a longer period.
3 Stocks That Recently Declared Dividend Hikes
Pan American Silver Corp.
Pan American Silver Corp. is a mining company focused exclusively on silver. PAAS is founded upon a single mission to become the best vehicle for equity investors wanting to gain real exposure to higher silver prices. Pan American Silver Corp has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
On Aug. 8, Pan American Silver Corp. announced that its shareholders would receive a dividend of $0.12 a share on Aug. 29. PAAS has a dividend yield of 1.25%. Over the past five years, Teck Pan American Silver Corp has increased its dividend four times, and its payout ratio presently sits at 26% of earnings. Check Pan American Silver Corp’s dividend history here.
Carlisle Companies Incorporated
Carlisle Companies Incorporated is a diversified, global portfolio of innovative brands and businesses with highly engineered and high-margin products. CSL engages in the design, manufacture and sale of a wide range of roofing and waterproofing products, engineered products and finishing equipment. Carlisle Companies Incorporated has a Zacks Rank #3 (Hold).
On Aug. 8, Carlisle Companies Incorporated declared that its shareholders would receive a dividend of $1.10 a share on Sept. 2. CSL has a dividend yield of 1.09%. Over the past five years, Carlisle Companies Incorporated has increased its dividend six times, and its payout ratio presently sits at 20% of earnings. Check Carlisle Companies Incorporated’s dividend history here.
DHT Holdings
DHT Holdings, Inc. operates a fleet of double-hull crude oil tankers on international routes. DHT's modern fleet consists of three Very Large Crude Carriers, two Suezmax tankers and four Aframax tankers. DHT Holdings carries a Zacks Rank #3.
On Aug. 7, DHT Holdings announced that its shareholders would receive a dividend of $0.24 a share on Sept. 25. DHT has a dividend yield of 5.25%. Over the past five years, DHT Holdings has increased its dividend seven times, and its payout ratio presently sits at 56% of earnings. Check DHT Holdings’ dividend history here.
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Carlisle Companies Incorporated (CSL): Free Stock Analysis Report Pan American Silver Corp. (PAAS): Free Stock Analysis Report DHT Holdings, Inc. (DHT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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