3 Hated Dividend Stocks to Buy Now
When looking for dividend stocks, it's important to find a balance between yield and fundamentals. Very often the highest yields are paid by stocks that either can't support the payouts being made or have particularly risky outlooks. But frequently, the best time to buy a dividend stock is when it is temporarily out of favor on Wall Street. Here are three names that appear to be out of favor, but that still have solid businesses and long-term potential.
The first name up is master limited partnership Enterprise Products Partners (NYSE: EPD), which operates in the midstream area of the energy sector. Oil- and natural gas-related names are out of favor today for a number of reasons, including low energy prices, weak demand, and the rise of cleaner alternatives. These are very real issues, but they have to be looked at in a broader context. For example, it's unlikely that oil will be displaced for many years because energy transitions take a long time to work through. Meanwhile, roughly 85% of Enterprise's gross margin is generated by fees and isn't related to the actual price of the commodities it helps move. On the demand front, COVID-19 has artificially depressed energy use; as economies around the world open up again, demand will likely return.
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Source Fool.com
