Dividend Growth Stocks
The Federal Reserve is trying to fight inflation by raising interest rates. This simultaneously generates anxiety – either real or imagined – in the minds of investors. Rising interest rates are generally considered deleterious to stock values. This could be especially true for dividend paying stocks as rising rates coincide with higher fixed income yields which make bonds and other fixed temperaments more competitive with equities.
In this video I will be covering the highest quality, largest, and attractively valued asset management and custody banks, all that carry a dividend. I will be featuring two specifically that analysts believe could benefit from rising rates. The prices of this asset class are historically low. Therefore, I would argue that much of the risk of investing in these companies is further mitigated via a margin of safety built into their price. Future performance could actually disappoint and these companies could still be great long-term investments. The key phrase here is great long-term investments. Value investing goes hand-in-hand with taking a long-term view. Value stocks usually become great values because of a reason. The trick for the value investor is determining whether the reason is temporary or transitory or more permanent in nature. I believe for the companies covered in this video the reasons are more transitory. There are strong demographic forces that stand to benefit this subindustry group over the long run.
The companies in this video I will covers are State Street Corp (STT), Ameriprise Financial (AMP), Bank of New York Mellon (BK), Blackstone (BX), Blackrock (BLK), KKR & Co (KKR)
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Disclosure: Long STT and AMP at the time of writing.
Disclaimer: The opinions in this document are for informational and educational purposes only and should not be construed as a recommendation to buy or sell the stocks mentioned or to solicit transactions or clients. Past performance of the companies discussed may not continue and the companies may not achieve the earnings growth as predicted. The information in this document is believed to be accurate, but under no circumstances should a person act upon the information contained within. We do not recommend that anyone act upon any investment information without first consulting an investment advisor as to the suitability of such investments for his specific situation.