2 Stocks That Have Been Boosting Their Dividends Lately

The U.S. economy is teetering on the brink of a recession, with nearly half of the CFOs from North America’s leading companies expecting a downturn by 2023. Traders have ramped up bets on a 72.5% chance of a 75-basis-point rate hike in September after Fed Chair Jerome Powell said that the U.S. economy would need tight monetary policy “for some time” before inflation is under control.

Moreover, the major benchmark indexes seem on track to finish the week down by about 3%. The Dow Jones closed the last month down about 4.1%, and the S&P and Nasdaq recorded losses of 4.2% and 4.6%, respectively.

Given the uncertain macro environment, investors should take note of dividend stocks Lowe’s Companies, Inc. (LOW) and Zoetis Inc. (ZTS) that have been boosting their dividends lately.

Lowe’s Companies, Inc. (LOW)

LOW operates as a home improvement retailer in the United States and internationally. The company offers a line of products for construction, maintenance, repair, remodeling, and decorating.

LOW’s $4.20 annual dividend yields 2.16% at its current share price. Its quarterly dividend of $1.05 is payable on November 2, 2022. The company had increased its dividend in May 2022 by 31% over the previous quarterly dividend of eighty ($0.80) cents per share. Its dividend payouts have increased at a 20.1% CAGR over the past three years and 18.8% over the past five years. The company has a record of 58 consecutive years of dividend growth.

LOW’s operating income increased marginally to $4.23 billion in the fiscal quarter ended July 29, 2022. Net earnings for the quarter came in at $2.99 billion, while its EPS stood at $4.67, up 9.9% from its year-ago value.

Street expects LOW’s revenue for the fiscal quarter ending October 2022 to come in at $23.13 billion, indicating a marginal year-over-year increase. Its EPS is expected to improve 12.6% year-over-year to $3.07. The company beat the consensus EPS estimates in three of the trailing four quarters.

Over the past month, the stock has gained 1.4% to close the last trading session at $194.14.

LOW’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, translating to Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.

LOW is also rated B in Quality. Within the Home Improvement & Goods industry, it is ranked #13 of 62 stocks.

Click here to see additional POWR Ratings for Value, Momentum, Growth, Sentiment, and Stability for LOW.

Zoetis Inc. (ZTS)

ZTS develops, manufactures, and commercializes animal health medicines, vaccines, and diagnostic products in the United States and internationally.

In June 2022, ZTS announced the completion of its acquisition of Basepaws, a privately held petcare genetics company, which provides pet owners with genetic tests, analytics, and early health risk assessments. This should help the company enhance its portfolio in the animal health space and provide comprehensive solutions to pet owners.

ZTS’ $1.30 annual dividend yields 0.83% at its current share price. It paid its quarterly dividend of $0.33 on September 1, 2022. Its dividend payouts have increased at a 25.6% CAGR over the past three years and 19.4% over the past five years.

ZTS’ revenue increased 5% year-over-year to $2.05 billion in the fiscal quarter ended June 30, 2022. Net income attributable to ZTS came in at $529 million, up 3% year-over-year, while its EPS grew 5% from the year-ago value to $1.12.

Analysts expect ZTS’ revenue for the fiscal quarter ending September 2022 to come in at $2.10 billion, indicating an increase of 5.5% year-over-year. Also, the company’s EPS is expected to grow 1.7% year-over-year to $1.27 in the same period. It has an impressive earnings surprise history as it beat the street consensus EPS estimates in all of the trailing four quarters.

The stock slumped 8.4% over the past three months to close its last trading session at $156.53.

ZTS’ sound fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, equating to Buy in our rating system.

The company also has a B grade in Stability and Quality. Out of the 167 stocks in the  Medical - Pharmaceuticals industry, ZTS is ranked #21.

Click here to get ZTS’ ratings for Momentum, Value, Sentiment, and Growth.

LOW shares were trading at $194.15 per share on Thursday afternoon, up $0.01 (+0.01%). Year-to-date, LOW has declined -23.91%, versus a -17.03% rise in the benchmark S&P 500 index during the same period.

Komal's passion for the stock market and financial analysis led her to pursue investment research as a career. Her fundamental approach to analyzing stocks helps investors identify the best investment opportunities.

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