In today’s volatile market, income-seeking investors face a challenging landscape. With interest rates potentially peaking and economic uncertainties looming, the allure of high-yield dividend stocks has never been stronger. However, many well-known dividend payers are already trading at premium valuations, leaving investors searching for hidden opportunities.
According to recent data, the S&P 500’s average dividend yield stands at just 1.5%, well below historical averages. This environment creates a perfect storm for savvy investors to uncover overlooked, high-yield gems poised for growth.
With this wisdom in mind, we’ve identified five under-the-radar dividend stocks that offer attractive yields and significant upside potential for 2024.
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1. Northwest Natural Holding (NYSE: NWN)
Northwest Natural Holding is a natural gas utility serving the Pacific Northwest. Despite its essential service nature, NWN has flown under many investors’ radars.
Why it’s a compelling investment:
- Solid 5% dividend yield
- 67 consecutive years of dividend increases
- Stable, regulated business model
- Expanding into water utilities for additional growth
The company’s consistent dividend growth and expansion into water utilities position it well for future gains.
Analyst Ratings:
Category | Value |
---|---|
Consensus Rating | Hold |
Average Price Target | $62.50 |
Potential Gain | 12.1% |
Number of Ratings | 5 |
Analyst Overview: While analysts maintain a neutral “Hold” rating on NWN, the average price target suggests a potential upside of 12.1%. This indicates that despite the conservative outlook, there’s still room for growth. The stable cash flows and attractive dividend yield make it an interesting option for income-focused investors, although regulatory changes and competition remain concerns.
2. Black Hills Corporation (NYSE: BKH)
Black Hills is a diversified energy company operating electric and gas utilities across several Midwestern states.
Why it stands out:
- Attractive 4.52% dividend yield
- 53 years of consecutive dividend increases
- Diverse energy portfolio including renewables
- Strong presence in fast-growing markets
The company’s diversified energy portfolio and presence in growing markets make it an attractive option for income investors.
Analyst Ratings:
Metric | Value |
---|---|
Consensus Rating | Overweight |
Average Price Target | $73.17 |
Potential Gain | 12.1% |
Number of Ratings | 7 |
Analyst Overview: Analysts are optimistic about Black Hills Corporation, with an “Overweight” consensus rating. The average price target indicates a potential 12.1% upside, suggesting that analysts believe the stock has room to grow. This positive outlook is likely driven by the company’s stable business model, consistent dividend growth, and strategic positioning in growing markets.
3. Easterly Government Properties (NYSE: DEA)
Easterly is a unique REIT focusing exclusively on leasing properties to the U.S. government.
Why it’s worth considering:
- Impressive 7.8% dividend yield
- Highly stable tenant base (U.S. government)
- Long-term leases provide predictable cash flows
- Trading at a discount to NAV
While not widely followed, Easterly offers a compelling combination of high yield and stability.
Analyst Ratings:
Metric | Value |
---|---|
Consensus Rating | Hold |
Average Price Target | $14.50 |
Potential Gain | 12.1% |
Number of Ratings | 4 |
Analyst Overview: Analysts maintain a neutral “Hold” rating on Easterly Government Properties, with a price target suggesting a 12.1% potential upside. This balanced view likely reflects the company’s stable business model and high dividend yield, balanced against potential concerns about growth prospects in a niche market. The lack of “Sell” ratings indicates that analysts see value in DEA‘s unique positioning.
4. Artisan Partners Asset Management (NYSE: APAM)
Artisan Partners is a global investment management firm known for its high-quality, actively managed strategies.
Why it’s a hidden gem:
- Exceptional 9.5% dividend yield
- Strong track record of investment performance
- Variable dividend policy aligns payouts with profitability
- Trading at an attractive valuation
Despite its high yield, Artisan Partners remains overlooked by many investors.
Analyst Ratings:
Category | Value |
---|---|
Consensus Rating | Overweight |
Average Price Target | $44.17 |
Potential Gain | 14.1% |
Number of Ratings | 7 |
Analyst Overview: Analysts are bullish on Artisan Partners Asset Management, with an “Overweight” consensus rating. The average price target indicates a potential 14.1% upside, suggesting strong confidence in the company’s prospects. This positive outlook likely stems from APAM‘s attractive dividend yield, solid performance track record, and potential to capitalize on any renewed interest in active management strategies.
5. Algonquin Power & Utilities Corp (NYSE: AQN)
Algonquin is a diversified utility company with a growing renewable energy portfolio.
Why it’s poised for a comeback:
- High 6.7% dividend yield
- Mix of regulated utilities and renewable energy assets
- Trading at a significant discount to historical valuations
- Potential catalyst in strategic review process
After a challenging 2023, Algonquin appears ready for a rebound.
Analyst Ratings:
Metric | Value |
---|---|
Consensus Rating | Overweight (Buy) |
Average Price Target | CAD 18.14 |
Potential Gain | 14.1% |
Number of Ratings | 12 |
Analyst Overview: Analysts are optimistic about Algonquin Power & Utilities Corp, with a consensus “Overweight” (Buy) rating. The average price target suggests a potential 14.1% upside, indicating strong confidence in AQN‘s recovery and growth prospects. Analysts cite the company’s strong financial performance, diversified portfolio, and growth opportunities in the renewable energy sector as key factors driving their positive outlook.