This veteran money manager has seen it all. And these 19 dividend shares are going through its strict quality display right now.

Lewis Altfest’s time in the financial industry spans seven decades. He has some tips for investors who are not used to creepy stock price movements.

He founded Altfest Personal Wealth Management in 1983 after working as a general partner and research director at Lord Abbett & Co. Prior to that, he was an analyst for many companies, including Lehman Brothers.

Below, Altfest modifies its methodology for a dividend stock display to help investors deal with troubled markets.

Since fleeing his home country, Altfest, whose company manages about $ 1.5 billion in private clients, has had the following advice for long-term investors who may find it difficult to wait in a bear market for better times: “Bears they come to the back deck looking for food. We are not afraid of them. We knock on the back window and they run away. My advice to young people is not to be afraid of the bear market for stocks! It may take time for the bear to run, but it always happens. “

Asked about his customers’ concerns this year, Altfest said most “have not yet panicked” and that it is usually the younger customers who are most nervous about the current environment, in which rising interest rates have pushed shares and bond valuations.

He noted that by creating cash balances and maintaining short-term bonds at the end of 2021, he was able to take advantage of price reductions this year.

He said: “We have stayed away from volatility”, which is reflected in the stock control methodology below.

When asked for an example of an investment that held up well this year, Altfest named the Lazard Global Listed Infrastructure Fund GLIFX,
+ 0.12%.
Here is the performance until June 28, with the S&P 500 SPX,
-0.38%
added for reference (with dividends reinvested for both):

FactSet

Altfest said that in the long run, he and his colleagues were interested in biotechnology, “which has been hit and has a rosy future,” and in international distribution, “especially emerging markets.” Reported by iShares Biotechnology ETF IBB,
+ 0.44%
and the Matthews Asia Innovators Fund MATFX,
-0.06%
as two broad vehicles used by himself and the team of investment managers for broad exposure in these market segments.

Check of dividend shares in the USA

In January, Altfest said investors were “buying high”. The S&P 500 started the year with a futures-to-earnings ratio of 21.5 – the US benchmark futures P / E has fallen 24% to 16.4 since then.

For many Altfest customers, income is a primary goal. In recent years, this has led to a focus on stocks with attractive dividend yields. Even with rising interest rates this year, the yield on US Treasury 10-year bonds TMUBMUSD10Y,
3.110%
is 3.17%, which is not very attractive because the bonds do not have long-term stock growth.

With stock prices falling so much and a weakening economy in mind, Altfest has made some changes to the recommended initial check criteria for dividend shares. It now proposes to start with a dividend yield of at least 3.5% (from the previous 3%), with estimates for sales and profits increasing by 3% to 4% (below the previous range of 4% to 5%).

He also wants to pursue a low volatility strategy, with beta 1 or less. Beta is a measure of price volatility over time. For this screen, a beta of less than 1 indicates that the price of a stock was less volatile than the S&P 500 last year.

See how we checked the S&P 500 for quality dividend stocks:

  • Beta for the last 12 months 1 or less, compared to the price movement of the entire index: 324 companies.

  • Dividend yield of at least 3.5%: 64 companies.

  • Estimated earnings per share for 2024 increase by at least 4% from 2023, based on the consensus estimates of analysts who participated in a FactSet poll. Altfest suggested that we move on to avoid distorting this year’s estimates from the actual EPS results. This reduced the list to 45 companies.

  • Estimated sales for 2024 increase by at least 4% from 2023, based on the consensus estimates of analysts surveyed by FactSet. Earnings and sales estimates were based on calendar years rather than corporate financial years, which often do not match the calendar. This last filter reduced the list to 19 shares.

Here they are, sorted by dividend yield:

Company

Heart

Dividend yield

Expected increase in EPS – 2024

Expected sales increase – 2024

Vornado Realty Trust

VNO,
-2.53%

7.19%

43%

8%

Oneok Inc.

OK,
-1.50%

6.56%

5%

8%

Philip Morris International Inc.

AFTER NOON,
-1.58%

4.88%

9%

6%

Walgreens Boots Alliance Inc.

WBA,
-0.59%

4.66%

6%

4%

International Business Machines Corp.

IBM,
-1.13%

4.65%

4%

5%

Pinnacle West Capital Corp.

PNW,
-1.59%

4.65%

6%

4%

Federal Realty Investment Trust

FRT,
-2.02%

4.35%

14%

7%

VF Corp.

VFC,
-3.20%

4.34%

10%

7%

Realty Income Corp.

O,
-0.19%

4.30%

7%

11%

Truist Financial Corp.

TFC,
-1.85%

3.97%

10%

5%

Kimco Realty Corp.

KIM,
-1.84%

3.93%

16%

5%

US Bancorp

USB,
-0.94%

3.92%

7%

4%

Darden Restaurants Inc.

DRI,
-1.16%

3.92%

11%

6%

Southern Co.

SO,
-0.20%

3.85%

9%

4%

Principal Financial Group Inc.

PFG,
-0.81%

3.76%

7%

5%

Cardinal Health Inc.

CAH,
+ 0.09%

3.68%

8%

5%

Digital Realty Trust Inc.

DLR,
-5.47%

3.63%

20%

7%

Morgan Stanley

LADY,
-0.16%

3.58%

13%

4%

Ventas Inc.

VTR,
-0.07%

3.52%

59%

7%

Source: FactSet

Click on tickers to start your own research on any of the companies.

Click here for Tomi Kilgore’s detailed guide to the wealth of free information on the MarketWatch bidding page.

A stock screen based on a limited number of factors only serves as a starting point for further research. If you are interested in any of the shares on the list, you need to find out more about the companies and the long-term prospects of the companies yourself, in order to form your own opinion.

More coverage for the middle of the year:

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