Stocks to buy

With recent stock market weakness, look for long-term dividend stocks to buy.

After failing to hold a rally that began in June 2022, the S&P 500 erased more than it gained by Sept. All thanks to persistently higher inflation, and the Federal Reserve’s aggressive monetary tightening campaign. Still, investors will benefit by looking beyond weak markets. In fact, nowadays, investors can take advantage of discounted stocks, and collect a dividend along the way.

After all, since interest rates may remain elevated, investors may be safer with high-yielding dividend stocks, including these seven.

BBY Best Buy $64.18
BCS Barclays $6.60
F Ford Motor $11.49
GSK GSK. $30.16
INTC Intel $26.90
IRM Iron Mountain $45.42
MO Altria Group $41.50

Best Buy (BBY)

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Best Buy (NYSE:BBY) currently yields 5.56%. The big-box retailer also has an attractive price-to-earnings multiple of 8.5 times. Inflation will increase the price of electronics that consumers need. For example, when they are due for replacement, consumers will buy televisions, appliances, and computers from Best Buy.

Best Buy’s Chief Executive Officer Corie Barry said that the company is starting to see signs of the market stabilizing and costs moderating. For example, shipping rates are falling as the market returns to a more balanced capacity market.

Best Buy’s sales team is interacting with every customer to convert store traffic into sales. In July, the company enhanced its in-store point-of-sales tools. That way, staff has better ways of showing the value from services like Totaltech, a membership program.

In the months ahead, Best Buy will benefit from demand for large TVs and updated mobile smartphones. As long as the company keeps improving its customer service levels, it will have better sell-through than competitors.

Barclays (BCS)

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Barclays (NYSE:BCS) fell from $8.00 to around $6.40. On Sept. 29, the firm agreed to a $361 million settlement with the U.S. Securities and Exchange Commission. The firm conducted unregistered offers and sales of securities worth around $17.7 billion.

Barclays self-reported its over-issuances to regulators. It cooperated with the SEC’s staff throughout the investigation.

Barclays offers income investors a dividend yield of 4.9%. This is above the U.S. 10-year treasury yield of 3.83%. In addition, the company increased shareholder returns by announcing an intent to buy up to GBP 0.5 billion worth of shares. This is on top of the GBP 1 billion share buyback it nearly completed previously.

The company is diversifying its business to lower shareholder risks. Investors should expect Barclays to increase its top-line growth in end markets. In addition, it will reduce costs to increase the efficiency of its UK retail bank.

Ford Motor (F)

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After slipping to $11.20, the Ford Motor (NYSE:F) stock yields 5.36%.

Last week, Ford said it would invest $700 million and add 500 jobs at its Louisville truck plant. On Sept. 23, 2022, the automotive firm broke ground at its electric vehicle assembly plant. In addition, Ford projects it will produce two million electric vehicles globally by late 2026.

Ford is also attractive because of its domestic job creation. The less it relies on imports and production outside of the U.S., the less exposure it has to exchange rates. In addition, it should simplify the global supply chain. For over a year, the automotive sector suffered from supply chain disruption. In the years ahead, Ford is more likely to output vehicles with fewer moving parts. This will increase its profits. Investors may expect the firm to raise interest rates as free cash flow expands in the coming years.

GSK (GSK)

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GSK (NYSE:GSK) currently yields 7.57%. The company is developing a respiratory syncytial virus vaccine. In June 2022, GSK announced positive pivotal phase III data. AReSVi 006 is an RSV study vaccine candidate for adults aged 60 years and above. If approved, it could reduce the 360,000 hospitalizations and over 24,000 mortalities worldwide annually.

GSK stock is not without risk. The company did not settle the Zantac (ranitidine) U.S. litigation. GSK is named as a defendant in nearly 3,000 filed personal injury cases. Users of the drug claim that the heartburn medication has carcinogenic effects.

This month, an independent group of experts will meet with the US FDA, which will evaluate GSK’s marketing application for daprodustat, a drug that treats anemia due to chronic kidney disease in adults.

Intel (INTC)

Source: shutterstock.com/Peshkova

Intel (NASDAQ:INTC) currently yields 5.67%, and has multiple catalysts ahead.

For one, Intel will unlock the value in its Mobileye Global unit through an initial public offering. Two, to expand its market beyond CPUs, the company will enter the graphics card market with two mainstream products. The A750 and A770 will cost consumers just $289 and $329, respectively (starting price). Gamers may evaluate the new GPUs when Intel releases them on Oct. 12.

The PC gaming market is in dire need of another GPU supplier. Prices are still too high for the mainstream segment. Gamers need to turn to the used market to buy GPUs that have been on the market for two years or more. Investors might have a winning stock with this dividend-paying firm.

Iron Mountain (IRM)

Source: Vitalii Vodolazskyi / Shutterstock

Iron Mountain (NYSE:IRM) slumped on Sept. 20, 2022, after issuing its annual revenue target. The real estate investment trust (REIT) expects revenue will grow by 10% compounded annually. Markets pressured IRM stock when it forecasted adjusted funds from operations growing by 8%, compounded annually.

IRM stock pays a dividend of $2.47, which yields 5.63%. Patient investors should treat the sudden slump as a gift. The firm is transitioning from paper storage to digital data storage. Companies need to digitize an avalanche worth of paper data. They will need Iron Mountain’s expertise. As revenue rises, free cash flow will expand more than the market expects.

Iron Mountain has the pricing power to increase its profitability. Although its price hikes are modest, the firm could increase prices as economic activity accelerates. Companies still need to digitalize data amid a recession.

Altria Group (MO)

Altria Group (NYSE:MO) is a sin stock that markets like to punish. The tobacco maker is pivoting away from cigarettes. It invested in Juul to transition the business into e-cigarettes. Last week, the firm disclosed in an SEC filing that it would end its non-compete agreement with Juul Labs.

Altria could partner with another firm similar to Juul. It might offer a buyout. Either way, investors will welcome an expanded nicotine product line. It is finalizing two novel nicotine products. Once regulators approve it, Altria’s revenue will grow. It may buy back more shares and raise the dividend with a higher cash flow.

CEO Billy Gifford said that Altria is changing its innovation process. By becoming laser-focused on the consumer, Altria is in a better position to realize market share immediately after it introduces a new product.

Altria’s core business is healthy. In the last quarter, Marlboro’s demand grew. To offset the negative impact on inflation, the company raised prices. As a result, investors have confidence it would collect Altria’s regular dividend.

On the date of publication, Chris Lau did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Chris Lau is a contributing author for InvestorPlace.com and numerous other financial sites. Chris has over 20 years of investing experience in the stock market and runs the Do-It-Yourself Value Investing Marketplace on Seeking Alpha. He shares his stock picks so readers get actionable insight to achieve strong investment returns.

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