4 Top Dividend Stocks Poised for Gains

While the benchmark stock indexes are hovering near their all-time highs, factors including historically high inflation, supply-chain disruptions, and the Federal Reserve’s decision to begin tapering its bond-buying this month could lead to immense volatility in the near term.

For investors seeking ways to hedge their portfolios against any potential market volatility, betting on fundamentally sound dividend stocks could be a great strategy. Investors’ interest in high-dividend-yield stocks is evident in iShares Select Dividend ETF’s (DVY) 25.7% returns year-to-date.

In addition to ensuring a steady income stream, dividend-paying stocks Suncor Energy Inc. (SU), Triton International Limited (TRTN), Dorchester Minerals, L.P. (DMLP), and Natural Resource Partners L.P. (NRP) could also deliver solid price returns because of their fundamental strength. So, we think these stocks could be solid bets now.

Suncor Energy Inc. (SU)

SU is a Calgary, Canada-based integrated energy company that primarily focuses on developing petroleum resource basins in Canada's Athabasca oil sands, and markets crude oil, petroleum, and petrochemical products internationally. The company operates through four segments—Oil Sands; Exploration and Production; Refining and Marketing; and Corporate and Eliminations. It also markets crude oil, natural gas, byproducts, refined products, and power.

SU is scheduled to pay a $0.42 quarterly cash dividend on December 24, 2021. The stock pays a $1.36 per share dividend annually, which translates to a 5.32% yield. Its dividend has grown at a 4.1% rate over the past four years.

On September 16, 2021, SU signed agreements with eight Indigenous communities in the Regional Municipality of Wood Buffalo (RMWB) to acquire TC Energy Corporation’s (TRP) 15% equity interest in the Northern Courier Pipeline Limited Partnership. Connecting the Fort Hills asset to SU’s East Tank Farm asset, this pipeline will be operated by SU, and the ownership stake will provide long-term, stable revenues that will benefit the communities for decades to come.

For its fiscal third quarter, ended September 30, 2021, SU’s revenues increased 58.2% year-over-year to $10.21 billion. The company’s operating earnings came in at $1.04 billion for the quarter, versus a $338 million operating loss in the prior-year period. Its net earnings were  $877 million for the quarter, compared to a $12 million loss in the prior-year period. Its EPS was  $0.59, versus a $0.01 loss per share in the prior-year period. The company had $2.31 billion in cash and cash equivalents as of September 30, 2021.

Analysts expect SU’s revenue to improve 62.9% year-over-year to $31.82 billion in the current year. It surpassed the Street’s EPS estimates in three of the trailing four quarters. The stock’s EPS is expected to grow at 6.4% per annum over the next five years.

The stock has gained 72% in price over the past year and 36.7% over the past three months. SU closed yesterday’s trading session at $25.59.

SU’s POWR Ratings reflect this promising outlook. The stock has an overall B rating, which equates to Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 distinct factors, with each factor weighted to an optimal degree.

The stock has an A grade for Quality, and a B grade for Growth and Momentum. Click here to see the additional ratings for SU (Sentiment, Stability, and Value).

Of the 84 stocks in the B-rated Energy - Oil & Gas industry, SU is ranked #17.

Triton International Limited (TRTN)

Based in Bermuda, TRT acquires, leases, and sells various intermodal containers and chassis to shipping lines and freight forwarding companies, and manufacturers and provides maritime container management services. The company also purchases containers from shipping line customers and other sellers and resells them to container retailers and users.

TRTN is scheduled to pay a $0.65 quarterly cash dividend on December 23, 2021. The stock pays a $2.60 per share dividend annually, which translates to a 4.22% yield. The company’s dividend has grown at a 4.8% rate over the past four years.

For the third quarter, ended September 30, 2021, TRTN’s total leasing revenues increased 22.1% year-over-year to $400.19 million. Its operating income came in at $244.48 million, up 54% from the prior-year period. TRTN’s $163.76 million adjusted net income for the quarter indicates a 109.8% year-over-year improvement. Its EPS increased 113.2% year-over-year to $2.43. TRTN had $118.97 million in cash and cash equivalents as of September 30, 2021.

Analysts expect TRTN’s EPS to improve 95.2% year-over-year to $9 for the current year. The $1.53 billion consensus revenue estimate for the current year represents a 17.1% rise from the prior-year period. It surpassed the consensus EPS estimates in each of the trailing four quarters. The stock’s EPS is expected to grow at a 10% rate per annum over the next five years.

TRTN has gained 48.8% in price over the past year and 15.2% over the past three months. The stock ended yesterday’s trading session at $61.56.

TRTN’s POWR Ratings reflect this promising outlook. The stock has an overall B rating, which equates to Buy in our proprietary rating system.

TRTN has an A grade for Sentiment, and a B grade for Momentum. Click here to see the additional ratings for TRTN’s Growth, Value, Stability, and Quality.

TRTN is ranked #5 of 46 stocks in the Shipping industry.

Dorchester Minerals, L.P. (DMLP)

DMLP acquires, owns, and administers non-producing natural gas and crude oil royalty, net profits, and leasehold interests. DMLP is based in Dallas, Tex.

DMLP paid a $0.51 quarterly cash dividend on November 10, 2021. The stock pays a $1.53 per share dividend annually, which translates to an 8.22% yield. The company’s dividend has grown at a 10.4% rate over the past four years.

For the fiscal third quarter, ended September 30, 2021, DMLP’s total net operating revenues increased 91.1% year-over-year to $23.97 million. While its net income increased 220.9% year-over-year to $18.03 million, its EPS grew 206.3% to $0.49. DMLP had $22.33 million in cash and cash equivalents as of September 30, 2021.

DMLP has gained 70% in price over the past year and 16.9% over the past month. The stock ended yesterday’s trading session at $18.67.

It is no surprise that DMLP has an overall A rating, which equates to Strong Buy in our POWR Ratings system.

The stock has an A grade for Quality, and a B grade for Growth. Click here to see the additional ratings for DMLP (Value, Momentum, Stability, and Sentiment).

DMLP is ranked #3 of 37 stocks in the A-rated MLPs - Oil & Gas industry.

Natural Resource Partners L.P. (NRP)

NRP  owns, manages, and leases a diversified portfolio of mineral properties in the United States, including interests in coal and other natural resources. The Houston, Tex., company operates in two segments—Coal Royalty and Other; and Soda Ash. It leases a portion of its reserves in exchange for royalty payments and owns and leases transportation and processing infrastructure related to coal properties.

NRP is scheduled to pay a $0.45 quarterly cash dividend on November 23, 2021. The stock pays a $1.80 per share dividend annually, which translates to a 5.96% yield. The company’s dividend has grown at an 8.7% rate over the past four years.

NRP’s total revenues came in at $56.80 million for its fiscal third quarter, ended September 30, 2021, representing an 89.8% year-over-year improvement. The company’s income from operations was  $39.15 million, indicating a 124.1% rise from the prior-year period. Its net income was  $29.50 million for the quarter, up 308.8% from the year-ago period. NRP’s EPS was  $1.10 versus a $0.02 loss per share in the prior-year period. As of September 30, 2021, the company had $118.99 million in cash and cash equivalents.

NRP’s $202.70 million revenue estimate for the current year represents a 44.5% rise from the prior-year period. The stock has gained 93.5% in price over the past year and 42.9% over the past month. The stock ended yesterday’s trading session at $30.21.

NRP’s POWR Ratings reflect its solid prospects. The stock has an overall A rating, which equates to Strong Buy. NRP has an A grade for Momentum, and a B grade for Growth, Sentiment, and Quality. In addition to the POWR Ratings grades we have just highlighted, one can see NRP’s Value and Stability grades here.

NRP is ranked #2 of 9 stocks in the A-rated MLPs - Other industry.

SU shares were trading at $25.43 per share on Wednesday afternoon, down $0.16 (-0.63%). Year-to-date, SU has gained 52.92%, versus a 26.41% rise in the benchmark S&P 500 index during the same period.

Sweta is an investment analyst and journalist with a special interest in finding market inefficiencies. She’s passionate about educating investors, so that they may find success in the stock market.

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