After years of low interest rates, many investors have turned to stocks not only for their growth potential, but also for strong and reliable dividends that help provide a stream of income. This equates to total return, which is one of the most powerful investment strategies.
We always like to remind our readers of the impact that total return can have on portfolios, as it is one of the best ways to improve the chances of overall investment success. Again, total return is the combined increase in a share’s value plus dividends. For example, if you buy a stock at $ 20 that pays a 3% dividend and it goes up to $ 22 in a year, your total return is 13%: 10% for the increase in the stock price. and 3% for dividends paid.
Five companies are expected to increase their dividends this week, so we sifted through our 24/7 Wall St. research universe and found that the stocks of all five are listed Buy by some of the best companies on Wall Street. While it’s always possible that all five won’t increase their dividends, top analysts expect them to, and generally the data is based on past increases in the company’s dividend payouts. . It is important to remember that no analyst report should be used as the sole basis for any buy or sell decision.
Bonanza Creek Energy
This title is far from the radar but offers a solid upside potential. Bonanza Creek Energy Inc. (NYSE: BCEI) is engaged in the extraction of petroleum and natural gas rich in associated liquids. It focuses on the Niobrara and Codell formations in the Denver-Julesburg Basin.
The Company’s primary risk-weighted oil and liquids assets are located in the Wattenberg field in Colorado. As of December 31, 2020, the company had proven reserves of 118.2 million barrels of oil equivalent. The company announced in May that it has entered into a definitive agreement with Extraction Oil & Gas to merge under a 50/50 deal, in which the shareholders of the two companies will have an equal percentage stake in the combined entity. . Notably, the deal, valued at $ 2.6 billion, is expected to be finalized in the third quarter of 2021.
The merged entity, renamed Civitas Resources, will be considered the largest pure oil and gas company in Colorado’s Denver-Julesburg Basin. In fact, the majority of corporate operations are based in this basin, spanning the Front Range and parts of Wyoming and Nebraska.
Shareholders currently receive an annual dividend of 3.64%. The company is expected to increase the dividend to $ 0.40 per share from $ 0.35.
Truist Securities has a massive price target of $ 60, but the Wall Street consensus target is even higher at $ 62.17. The shares were trading early Monday at close to $ 37.30.