Foreword
This article is based on two Kiplinger investing articles aimed at retirees:
25 Stocks Every Retiree Should Own, by Charles Lewis Sizemore, CFA, published 7/2/19, featured a "group of retirement stocks that includes both pure income plays and growth companies, with a focus on very-long-term performance and durability.”
20 Dividend Stocks to Fund 20 Years of Retirement, (yielding roughly 4% or higher), updated 8/5/20, by Brian Bollinger, "...should fund at least 20 years of retirement, if not more. They have paid uninterrupted dividends for more than 20 consecutive years, appear to have secure payouts and have the potential to collectively grow... dividends to protect investors’ purchasing power."
Any collection of stocks is more clearly understood when subjected to yield-based (dog catcher) analysis, these Kiplinger reliable dividend stocks for retirees are perfect for the dogcatcher process. Here is the February 19 data for the 41 stocks in the Kiplinger-sourced collection, limited to 39 dividend producers.
The Ides of March 2020 plunge in the stock market took its toll, yet most of these retiree selections bounded back beyond broker targets.
The following 12 (as of February 19) continue to live up to the Dogcatcher ideal of having annual dividends from a $1K investment exceed their single share prices: Magellan Midstream Partners (MMP), Enterprise Partners LP (EPD), Enbridge Inc. (ENB), Pembina Pipeline Corp. (PBA), AT&T Inc. (T), Kinder Morgan Inc. (KMI), Exxon Mobil Corp. (XOM), LTC Properties Inc. (LTC), Physicians Realty Trust (DOC), National Retail Properties Inc. (NNN), Ennis Inc. (EBF), Monmouth Real Estate Investment (MNR). Many investors regard this condition as a "look closer to maybe buy" signal.
Actionable Conclusions (1-10): Analysts Estimated 15.47% To 29.8% Net Gains For Ten Top Reliable Retirement Dividend Dogs To February 2022
Four of ten top Kiplinger most reliable retirement stocks by yield were among the top ten gainers for the coming year based on analyst 1-year target prices. (They are tinted gray in the chart below). Thus, the yield-based forecast for these February dogs was graded by Wall St. Wizards as 40% accurate.
Price projections were based on estimated dividends from $1000 invested plus their aggregated one-year analyst median target prices, as reported by YCharts. Note: target prices by lone-analysts were not applied. Ten probable profit-generating trades projected to February 19, 2022 were:
Source: YCharts.com
Enterprise Products Partners LP was projected to net $297.99, based on the median of target price estimates from twenty-three analysts, plus annual dividend, less broker fees (if any). The Beta number showed this estimate subject to risk/volatility 38% more than the market as a whole.
CVS Health Corp. (CVS) was projected to net $248.16, based on dividends, plus the median of target price estimates from twenty-seven analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 17% less than the market as a whole.
Enbridge Inc. was projected to net $245.93, based on dividends, plus the median of the target price estimates from twenty-six analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 14% under the market as a whole.
Unilever Group (UL) was projected to net $213.14 based on dividends, plus the median of target estimates from two brokers, less transaction fees. The Beta number showed this estimate subject to risk/volatility 52% less than the market as a whole.
Procter & Gamble Co. (PG) was projected to net $205.90, based on the median of target price estimates from twenty-four analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to risk/volatility 57% less than the market as a whole.
Kinder Morgan Inc. was projected to net $196.56, based on dividends, plus the median of target price estimates from twenty-five analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 6% over the market as a whole.
Physicians Realty Trust was projected to net $180.08, based on the median of target estimates from eighteen analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 18% under the market as a whole.
Realty Income Corp. (O) was projected to net $175.40, based on dividends, plus the median of target price estimates from twenty-one analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 29% less than the market as a whole.
Duke Energy Corp. (DUK) was projected to net $165.89, based on dividends, plus median target price estimates from eighteen analysts, less broker fees. The Beta number showed this estimate subject to risk/volatility 74% less than the market as a whole.
W.P. Carey Inc. (WPC) was projected to net $154.67, based on a median of target price estimates from nine analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 25% less than the market as a whole.
The average net gain in dividend and price was estimated at 20.84% on $10k invested as $1k in each of these ten stocks. These gain estimates were subject to average risk/volatility 24% under the market as a whole.
Actionable Conclusion (11): (Bear Alert) Analysts Predicted One Kiplinger Reliable Retirement Top Yield Dog To Show A -30.84% Loss to February 2022
The probable losing trade revealed by YCharts to 2021 was:
Source: YCharts.com
Magellan Midstream Partners LP projected a loss of $308.35 based on its dividend and the median of target price estimates from two analysts including broker fees. The Beta number showed this estimate subject to risk/volatility 58% under the market as a whole.
Source: collective-evolution.com
The Dividend Dogs Rule
Stocks earned the "dog" moniker by exhibiting three traits: (1) paying reliable, repeating dividends, (2) their prices fell to where (3) yield (dividend/price) grew higher than their peers. Thus, the highest yielding stocks in any collection became known as "dogs." More precisely, these are, in fact, best called, "underdogs".
37 Kiplinger Reliable Retirement Dividend Stocks Show February Target Gains
Source: YCharts.com
39 Kiplinger Reliable Retirement Dividend Stocks Per February Yield
Source: YCharts.com
Actionable Conclusions (12-21): 10 Top Kiplinger Reliable Retirement Dividend Stocks By Yield For February
Top ten February Reliable Retirement Dividend stocks still represented only three of eleven Morningstar sectors.
Seven energy stocks occupied first through fourth, sixth seventh and tenth places: Magellan Midstream Partners LP [1], Enterprise Products Partners LP [2], Enbridge Inc. [3], Pembina Pipeline Corp. [4], Kinder Morgan Inc. [6], Exxon Mobil Corp. [7] and Chevron Corp. (CVX) [10].
Fifth place went to a single communication services representative, AT&T Inc. [5].
Eighth and ninth places were claimed by two real estate sector representatives, W.P. Carey Inc. [8], and LTC Properties Inc. [9], to complete the reliable retirement top ten dividends by yield for February.
Actionable Conclusions: (22-31) Ten Top Reliable Retirement Dividend Dogs Showed 10.35%-22.98% Upsides While (32) Two Lowly Down-siders Drooped in This February Report
Source: YCharts.com
To quantify top dog rankings, analyst mean price target estimates provide a "market sentiment" gauge of upside potential. Added to the simple high-yield metrics, analyst median target price estimates became another tool to dig out bargains.
Analysts Forecast A 79.06% Advantage For The 5 Highest Yield, Lowest Priced Of Top Ten Reliable Retirement Dividend Stocks Come February 2022
Yield (dividend / price) results provided by YCharts did the ranking for these ten top reliable retirement dividend dogs.
Source: YCharts.com
As noted above, top ten Kiplinger reliable retirement dogs screened 2/19/21 showing the highest dividend yields represented three of eleven in the Morningstar sector scheme.
Actionable Conclusions: Analysts Predicted 5 Lowest-Priced Of The Top Ten Highest-Yield Reliable Retirement Dividend Dogs (33) Delivering 18.58% Vs. (34) 10.37% Net Gains by All Ten Come February 2022
Source: YCharts.com
$5000 invested as $1k in each of the five lowest-priced stocks in the top ten reliable retirement dividend kennels by yield were predicted by analyst 1-year targets to deliver 79.06% more gain than $5,000 invested as $.5k in all ten. The second lowest priced selection, Enterprise Products Partners LP, was projected to deliver the best net gain of 29.8%
Source: YCharts.com
The five lowest-priced top-yield Kiplinger most-reliable retiree dividend dogs as of February 19 were: Kinder Morgan Inc., Enterprise Products Partners LP, Pembina Pipeline Corp., AT&T Inc., Enbridge Inc, with prices ranging from $14.96 to $34.66.
Five higher-priced Kiplinger top yield reliable retirement dividend dogs as of January 22 were: LTC Properties Inc., Magellan Midstream Partners LP, Exxon Mobil Corp., W.P. Carey Inc., Chevron Corp., whose prices ranged from $40.68 to $95.80.
The distinction between five low-priced dividend dogs and the general field of ten reflected Michael B. O'Higgins' "basic method" for beating the Dow. The scale of projected gains based on analyst targets added a unique element of "market sentiment" gauging upside potential. It provided a here-and-now equivalent of waiting a year to find out what might happen in the market. Caution is advised, since analysts are historically only 20% to 80% accurate on the direction of change and just 0% to 20% accurate on the degree of change.
The net gain/loss estimates above did not factor in any foreign or domestic tax problems resulting from distributions. Consult your tax advisor regarding the source and consequences of "dividends" from any investment.
Afterword
If somehow you missed the suggestion of the fifteen stocks ripe for picking at the start of this article, here is a reprise of the list at the end:
The following 12 (as of February 19) continue to live up to the Dogcatcher ideal of having annual dividends from a $1K investment exceed their single share prices: Magellan Midstream Partners, Enterprise Partners LP, Enbridge Inc., Pembina Pipeline Corp., AT&T Inc., Kinder Morgan Inc., Exxon Mobil Corp., LTC Properties Inc., Physicians Realty Trust, National Retail Properties Inc., Ennis Inc., Monmouth Real Estate Investment. Many investors regard this condition as a "look closer to maybe buy" signal.
Stocks listed above were suggested only as possible reference points for your Retirement stock purchase or sale research process. These were not recommendations.
Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsem*nt to buy or sell any security. Prices and returns on equities in this article except as noted are listed without consideration of fees, commissions, taxes, penalties, or interest payable due to purchasing, holding, or selling same.
Graphs and charts were compiled by Rydlun & Co., LLC from data derived from www.indexarb.com; YCharts.com; finance.yahoo.com; analyst mean target price by Thomson/First Call in Yahoo Finance.
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