Over the last week, the markets have staged an epic turnaround.
Since the start of the week, the S&P 500 is up by an impressive 17%.
Of course, if you’ve been following my advice lately and invested during the fall, you’re already enjoying the profits from this turnaround.
I’m a bit skeptical of the situation at this point. Seventeen percent in one week is clearly a sign of exuberance. However, it does signal that there are plenty of investors willing to enter the market at these levels.
As a long-term investor, I’d say this is the time to be a buyer.
This is especially true if you’re a dividend investor.
As you know, a dividend yield is always higher when you purchase the stock near its lows.
And when your pick meets conditions like long-term business sustainability, growing revenues, and a history of steady dividend payout, then you can be confident you have scored an excellent deal.
In that context, here are three such stocks you should consider.
Dividend Opportunity #1: Eastman Chemical (NYSE: EMN)
Established way back in 1920, the first stock on my list is Eastman Chemical.
Initially, the company was established to produce chemicals for Eastman Kodak, the famous photographic film producer.
Today, however, it has grown into a multinational business, with factories in seven countries. The company’s core product remains chemicals, though it also added plastics and fabrics to its offerings.
The nature of Eastman Chemical’s business is highly cyclical, so its revenues fluctuate from one year to the next. Meaning, the best time to invest is when the economy is near its lows, like right now.
And since we will always need chemicals to produce other goods, it’s safe to assume Eastman Chemical is here to stay for at least another hundred years.
Best of all, the company has a remarkable dividend history, having been increasing them for decades, through good times and the bad, never missing a payment.
The stock’s dividend yield currently amounts to 5.67%.
Dividend Opportunity #2: Lazard (NYSE: LAZ)
Speaking of companies with a rich history, Lazard’s spans back to 1848.
Its business today, as it was then, is financial advisory, although they’ve also added an asset management division in the 1950s. The sales are evenly split between the two segments.
Again, we’re talking about a company with safe long-term projections. Lazard’s services will continue to be in demand for as long as financial markets continue to exist. Consequently, its revenues continue to grow.
But let’s get to the exciting part—the dividends.
I already like Lazard for its regular dividend, which currently yields 7.95%, and which they’ve been increasing for decades throughout all the crises.
What it makes it an excellent investment, though, is that asset managers like Lazard will often make higher one-time payouts. This happens whenever they close a fund or a deal and need to redistribute the profits to the shareholders.
Meaning, you can expect a special dividend every few years, on top of the already impressive regular dividend.
Dividend Opportunity #3: Polaris (NYSE: PII)
Another company worth considering, not just for its dividend yield, but also because it’s trading at such a discount, is Polaris.
The company designs and manufactures off-road vehicles, which it retails through thousands of dealerships and subsidiaries in over a hundred countries.
Over the last five years, Polaris has recorded an impressive 9.45% revenue increase per year. While I expect sales to decrease because of the coronavirus, just as they did in 2009, they should get back on track within two years.
By then, I also expect the stock price to double, which is what makes Polaris so exciting.
And even if we focus only on the dividend yield, it currently amounts to 5.14%, which is a lot for a high-growth cyclical company like Polaris.
Moreover, the management has been increasing dividend payouts since 1995, so you can expect your dividend yield to increase as years go by.