Looking for Stable Income? Keep an Eye on These 3 Dividend Stocks

Expectations of a recession later this year are high, considering the higher interest rates and an expected credit crunch due to tighter lending standards. While the market is currently volatile, investors could consider adding dividend-paying stocks Canadian Natural Resources Limited (CNQ), Eastman Chemical Company (EMN), and Whirlpool Corporation (WHR) to their watchlist.

Although inflation has shown signs of easing, it remains above the Fed’s target of 2%. A pause in interest rate hikes looks likely after Fed Chairman Jerome Powell indicated that the central bank might forgo raising the benchmark interest rate at its meeting next month. Powell stated, “Having come this far, we can afford to look at the data and the evolving outlook and make careful assessments.”

Despite the possibility of a pause in interest rate hikes, there exists the chance of a recession as the benchmark interest rate is at its highest level in 16 years, and the Fed looks unlikely to cut interest rates anytime soon. Moreover, regional bank failures will likely lead to a credit crunch due to tighter lending standards putting further pressure on the economy.

Amid seemingly ceaseless concerns of an impending recession, investors are challenged with where to secure their funds. When faced with macroeconomic uncertainty, investors may look to add dividend stocks to safeguard their portfolio as they can provide a stable source of income and stability against such economic headwinds.

For investors looking to tide over the uncertain macroeconomic conditions, dividend-paying stocks could be ideal. Amid this backdrop, adding the featured stocks to one’s watchlist could be wise.

Canadian Natural Resources Limited (CNQ)

CNQ acquires, explores for, develops, produces, markets, and sells crude oil, natural gas, and natural gas liquids (NGLs). The company offers light and medium crude oil, primary heavy crude oil, Pelican Lake heavy crude oil, bitumen (thermal oil), and synthetic crude oil (SCO).

Over the last three years, CNQ’s dividend payouts have grown at a 28.5% CAGR. Its four-year average dividend yield is 5.02%, and its trailing-12-month annual dividend of $2.43 per share translates to a 4.36% yield. It is expected to pay a quarterly dividend of $0.66 per share on July 5, 2023.

CNQ’s adjusted net earnings from operations for the fiscal first quarter ended March 31, 2023, declined 44.3% year-over-year to $1.88 billion. The company’s revenue declined 19.2% year-over-year to $8.63 billion. Its long term debt came in at $11.03 billion, compared to $11.04 billion for the fiscal year ended December 31, 2023.

Its adjusted net EPS came in at $1.69, representing a decline of 40.9% year-over-year. In addition, its cash flows from operating activities declined 54.6% year-over-year to $1.30 billion.

CNQ’s EPS for the quarter ending December 31, 2023, is expected to increase 5.2% year-over-year to $1.52. Its revenue for the quarter ending June 30, 2023, is expected to decline 36.6% year-over-year to $5.66 billion. It has a commendable earnings surprise history, surpassing the consensus EPS estimates in three of the trailing four quarters.

The stock has gained marginally year-to-date and declined 13.5% over the past year to close the last trading session at $55.69.

CNQ has a B grade for Quality in our POWR Ratings system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.

Within the B-rated Foreign Oil & Gas industry, it is ranked #38 out of 42 stocks.

Click here to access all the ratings of CNQ for Growth, Value, Momentum, Stability and Sentiment.

Eastman Chemical Company (EMN)

EMN operates as a specialty materials company worldwide.  It operates through four segments, Additives & Functional Products, Advanced Materials, Chemical Intermediates, and Fibers.

Over the last three years, EMN’s dividend payouts have grown at a 6.6% CAGR. Its four-year average dividend yield is 3.17%, and its forward annual dividend of $3.16 per share translates to a 3.89% yield. It is expected to pay a quarterly dividend of $0.79 per share on July 7, 2023.

EMN’s sales for the first quarter ended March 31, 2023, declined 11.1% year-over-year to $2.41 billion. The company’s total assets came in at $14.98 billion, compared to $14.67 billion for the fiscal year ended December 31, 2022.

On the other hand, its non-GAAP net earnings attributable to EMN declined 27.5% year-over-year to $195 million. Additionally, its EPS attributable to EMN came in at $1.63, representing a decline of 20.9% year-over-year.

EMN’s EPS and revenue for the quarter ending June 30, 2023, are expected to decline 26.9% and 5% year-over-year to $2.07 and $2.65 billion, respectively. However, it has an impressive earnings surprise history, surpassing the consensus EPS estimates in three of the trailing four quarters. Over the past month, the stock has gained 1.6% and declined 0.2% year-to-date to close the last trading session at $81.31.

It is ranked #23 out of 84 stocks in the B-rated Chemicals industry. It has a B grade for Value. We have also given EMN grades for Growth, Sentiment, Quality, Stsbility and Momentum. Get all EMN ratings here.

Whirlpool Corporation (WHR)

WHR manufactures and markets home appliances and related products and services worldwide.

The company’s principal products include refrigerators, freezers, ice makers, and refrigerator water filters; laundry appliances, and commercial laundry products and related laundry accessories; cooking and other small domestic appliances; and dishwasher appliances and related accessories, as well as mixers.

Over the last three years, WHR’s dividend payouts have grown at a 13.4% CAGR. Its four-year average dividend yield is 3.39%, and its forward annual dividend of $7 per share translates to a 5.22% yield. It is expected to pay a quarterly dividend of $1.75 per share on June 15, 2023.

For the fiscal first quarter ended March 31, 2023, WHR’s net sales declined 5.6% year-over-year to $4.65 billion. Its ongoing EBIT increased 46.8% year-over-year to $251 million. Its net loss per share came in at $3.27, compared to an EPS of $5.33 in the prior-year quarter.

WHR’s EPS for the quarter ending June 30, 2023, is expected to decrease 35.3% year-over-year to $3.86. Its revenue for the quarter ending September 30, 2023, is expected to increase 0.4% year-over-year to $4.81 billion. It has an excellent earnings surprise history, surpassing the consensus EPS estimates in three of the trailing four quarters.

Over the past month, the stock has gained 4% and declined 5.1% year-to-date to close the last trading session at $134.22.

It is ranked #42 out of 56 stocks in the B-rated Home Improvement & Goods industry. It has a B grade for Growth.

In total, we rate WHR on eight different levels. Beyond what we stated above, we have also given WHR a grade for Value, Momentum, Quality, Stability and Sentiment. Get all WHR ratings here.

What To Do Next?

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3 Stocks to DOUBLE This Year >

CNQ shares were trading at $54.84 per share on Tuesday afternoon, down $0.85 (-1.53%). Year-to-date, CNQ has gained 0.06%, versus a 10.29% rise in the benchmark S&P 500 index during the same period.

Malaika's passion for writing and interest in financial markets led her to pursue a career in investment research. With a degree in Economics and Psychology, she intends to assist investors in making informed investment decisions.

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