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7 Best Dividend Stocks With The Highest Expected Returns For 2024


Published on December 19th, 2023 by Bob Ciura

At Sure Dividend, we recommend investors focus on quality dividend stocks over the long run. In addition to dividends, investors should also be focused on total returns.

In short, the total expected return of a stock is the sum of its future earnings-per-share growth, dividends, as well as any net change in the valuation multiple. Ultimately, total returns matter most for investors.

With this in mind, we’ve compiled a list of the 50 best dividend stocks based on 5-year expected returns (along with important investing metrics like price-to-earnings ratios and dividend yields) which you can download below:

 

This article lists the 7 best dividend stocks now in the Sure Analysis Research Database. The top 7 stocks are listed below by 5-year expected annual returns, from lowest to highest.

Table Of Contents

The seven best dividend stocks are listed below in order of total expected returns over the next five years, from lowest to highest. You can instantly jump to any individual stock analysis by clicking on the links below:

Best Dividend Stock #7: Oaktree Specialty Lending (OCSL)

Oaktree Specialty Lending Corp. is a business development company, or BDC. It provides lending services and invests in small and mid-sized companies.

As of September 30th, 2023, the investment portfolio accounted for $2.9 billion at fair value diversified across 143 portfolio companies, with a focus on software (16.5%) and Specialty Retail (5.4%).

Source: Investor Presentation

On November 14th, 2023, Oaktree Specialty Lending Corp. released its fourth quarter fiscal 2023. For the quarter the company reported adjusted net investment income (NII) of $47.8 million or $0.62 per share, as compared with $47.6 million or $0.62 per share in the year-ago quarter.

For the full-year 2023, adjusted net investment income ended at $177.8 million or $2.47 per share, as compared with $128.6 million or $2.12 per share in 2022.

Click here to download our most recent Sure Analysis report on OCSL (preview of page 1 of 3 shown below):

Best Dividend Stock #6: Brandywine Realty Trust (BDN)

Brandywine Realty owns, develops, leases and manages an urban town center and transit-oriented portfolio which includes 163 properties in Philadelphia, Austin and Washington, D.C. The REIT has a market capitalization of $1.1 billion and generates 74% of its operating income in Philadelphia, 22% of its operating income in Austin and the remaining 4% in Washington, D.C.

In late October, Brandywine Realty Trust reported (10/24/23) financial results for the third quarter of fiscal 2023. Its occupancy fell sequentially from 89.4% to 88.3% and its funds from operations (FFO) per share remained flat at $0.29. It was the fourth consecutive quarter in which the impact of high interest rates on interest expense was evident.

Interest expense jumped 43% over last year’s quarter. As the REIT faces debt maturities, it has to issue new debt at high interest rates. Due to this headwind and its high debt load, the stock has plunged -71% off its peak in 2022, to a 13-year low. The REIT narrowed its guidance for FFO per share in 2023 from $1.14-$1.18 to $1.15-$1.17.

Click here to download our most recent Sure Analysis report on BDN (preview of page 1 of 3 shown below):

Best Dividend Stock #5: Petroleo Brasileiro S.A. (PBR)

Petroleo Brasil S.A., better known as Petrobras, is an integrated oil and gas giant that controls much of Brazil’s oil and natural gas production. The company now reports three major business segments: Exploration & Production; Refining; and Gas & Power. The company produced on average ~2.6M barrels of oil equivalent a day (boed) in 2022. Proven reserves are ~10.5B barrels of oil equivalent.

Petrobras reported Q3 2023 results on November 9th, 2023. Company-wide revenues fell (-21.2%) to $25,552M from $32,411M on a year-over-year basis because of lower average oil and diesel prices. Also, Petrobras’ volumes for diesel, gasoline, fuel oil, jet fuel, and other items were lower in comparable periods. Oil and other liquid prices are trending down again on lower demand and too much supply.

Click here to download our most recent Sure Analysis report on PBR (preview of page 1 of 3 shown below):


Best Dividend Stock #4: V.F. Corp. (VFC)

V.F. Corporation is one of the world’s largest apparel, footwear and accessories companies. Its brands include The North Face, Vans, Timberland and Dickies.

In late October, V.F. Corp reported (10/30/23) financial results for the second quarter of fiscal 2024. (V.F. Corp’s fiscal year ends the Saturday closest to March 31st.) Revenue dipped -2% over last year’s quarter and earnings-per-share decreased -14%, from $0.73 to $0.63, due to high cost inflation and a -21% plunge in sales of Vans, whose turnaround is taking much longer than initially expected.

Click here to download our most recent Sure Analysis report on VFC (preview of page 1 of 3 shown below):

Best Dividend Stock #3: Medifast Inc. (MED)

Medifast Inc is an American weight loss and nutrition company behind the health and wellness community OPTAVIA. Its business model is based on direct selling, where nearly 60,000 independent coaches offer exclusive OPTAVIA-branded nutritional products to their clients. As independent contractors, Coaches are not direct employees of Medifast and earn a commission for marketing and selling OPTAVIA products to friends and family.

The company’s OPTAVIA brand accounts for 98% of revenue, which is why it emphasizes increasing the number of coaches promoting its brand.

Medifast released third-quarter financial results on November 6th, 2023. Revenue continued to be under pressure this year with a second consecutive decline of over 30% to $235.9 million compared to Q3 2022 due to fewer actively earning OPTAVIA coaches and lower productivity per coach. The average revenue per coach dropped by 15.1% to $5,008, influenced by customer acquisition challenges and a partial offset from a price increase.

Click here to download our most recent Sure Analysis report on MED (preview of page 1 of 3 shown below):


Best Dividend Stock #2: Yum China (YUMC)

Yum China Holdings is China’s largest restaurant company, with over 14,000 restaurants in over 1,900 cities. Yum China separated from Yum! Brands in October 2016.

On October 31st, 2023, Yum China announced Q3 2023 results reporting non-GAAP diluted EPS of $0.59, missing estimates by $0.03. The revenue for the quarter was reported at $2.91 billion, up 9.0% as compared to last year. The company’s total system sales also saw an impressive 15% year-over-year growth, primarily driven by a 15% increase at KFC and a 13% increase at Pizza Hut when evaluated in constant currency.

Regarding same-store sales, YUMC experienced a 4% year-over-year increase, with KFC and Pizza Hut recording 4% and 2% growth, respectively, in constant currency. This improvement in same-store sales further underscores the company’s strong operational execution and market resilience.

Click here to download our most recent Sure Analysis report on YUMC (preview of page 1 of 3 shown below):

Best Dividend Stock #1: Office Properties Income Trust (OPI)

Office Properties Income Trust is a REIT that currently owns 157 buildings, which are primarily leased to single tenants with high credit quality. The REIT’s portfolio currently has a 90.5% occupancy rate.

Office Properties Income Trust At A Glance

In late October, OPI reported (10/30/2023) financial results for the third quarter of fiscal 2023. The occupancy rate dipped sequentially from 90.6% to 89.8% and normalized funds from operations (FFO) per share fell -8%, from $1.11 to $1.02.

More than 90% of the debt of OPI is at fixed rates but we expect interest expense to increase this year due to high interest rates. Notably, interest expense has consumed 94% of operating income in the last 12 months.

Click here to download our most recent Sure Analysis report on OPI (preview of page 1 of 3 shown below):

Additional Reading

Investors looking for additional dividend stock ideas can find additional reading below:

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