Since rising inflation, a decline in overall productivity, and an expanding trade deficit could heighten stock market volatility in the near term, we think it could be wise to bet on high-yielding dividend stocks Broadcom Inc. (NASDAQ:AVGO), Zoetis Inc . (NYSE:ZTS) and ABB Ltd (ABB) to ensure a steady income stream. These stocks have an overall ‘Strong Buy’ rating in our proprietary rating system.Companies that pay dividends are generally well established and relatively less subject to market risks. Brian Belski, BMO’s chief investment strategist, stated, “Elevated cash levels, below average payout ratios...and an unprecedented recovery in corporate earnings are setting the stage for an extended rebound in shareholder distribution.”
While the market is rallying on solid job growth and the Fed’s confidence in the economic recovery, factors such as rising inflation, a decline in overall productivity, and an expanding trade deficit could foster significant market volatility in the near term. Thus, fundamentally sound dividend stocks could be ideal bets now. Investors’ interest in dividend stocks is evident in the SPDR Portfolio S&P 500 High Dividend ETF’s (SPYD) 4.4% returns over the past three months and 24.2% year-to-date.
Therefore, dividend stocks Broadcom Inc. (AVGO), Zoetis Inc. (ZTS), and ABB Ltd (ABB) could be solid picks now. These companies have an overall A (Strong Buy) rating in our POWR Ratings system.