Shares of Altria Group (NYSE:MO) and Energy Transfer (NYSE:ET) are renowned for their stellar dividend payment histories and high yields. On average, Mo and ET stocks offer a yield of about 9%, near the current levels. This implies that an investment of $5,600 distributed equally between both of these stocks could result in a dividend income of over $500/year ($504, to be precise).
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With this backdrop, let’s see why MO and ET are solid dividend stocks.
Is Altria Still a Dividend King?
Altria is a dividend king, denoting stocks that have consistently increased dividends for 50 consecutive years. It recently increased its quarterly dividend by 4.3% to $0.98 per share, translating into an annualized distribution rate of $3.92. Including this hike, the tobacco giant has raised its dividend 58 times in the past 54 years. Further, the stock is yielding about 9.2%.
Altria expects its earnings per share (EPS) to grow at a mid-single-digit rate annually through 2028. This will enable the company to consistently increase its dividend by a mid-single-digit rate during the same period.
While Altria is a solid dividend stock, Wall Street analysts remain sidelined. With three Buy, four Hold, and one Sell recommendations, MO stock has a Hold consensus rating. Further, analysts’ average price target of $44.90 implies 8.35% upside potential from current levels.
How Often Does Energy Transfer Pay Dividends?
Energy Transfer pays dividends on a quarterly basis. The energy infrastructure company owns a diversified portfolio of assets that helps it generate steady cash flows. Thanks to its diversified assets and fee-based earnings, Energy Transfer has consistently increased its dividend.
The stock is yielding about 9%, near the current levels. Further, the company targets growing its annual dividend by 3-5% in the long term.
With six Buy and one Hold recommendations, ET stock has a Strong Buy consensus rating. Further, analysts’ average price target of $18.14 implies 32.70% upside potential from current levels.
Bottom Line
Altria and Energy Transfer stocks emerge as reliable dividend stocks. Further, the visibility of their future payouts and high yield make them appealing. However, Wall Street is bullish about Energy Transfer and sees higher upside potential.
