2023’s Best Picks: Top 5 High Dividend Yield Stocks for Strategic Investing

Companhia Siderúrgica Nacional ADR, International Seaways Inc., Frontline plc, Civitas Resources Inc., and Blue Owl Capital Corporation ranked among the top five companies with the highest dividend yield in 2023. Today, on 26 December 2023, we will examine these leading companies, discuss their financial reports, conduct a technical analysis of their stocks, and share experts’ forecasts for 2024.

What is dividend yield?

Let us start with the definition of a dividend yield. This financial indicator reflects a percentage ratio between the annual dividend payouts per share and its current market price. It shows what part of the share income investors can expect to receive as dividends. For the dividend yield calculation, annual dividends per share are divided by the current market price and multiplied by 100%. Find out more about this in the article How is Dividend Yield Calculated?

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Selection criteria for companies:

• The stock is traded on the NYSE and NASDAQ
• The companies are not classified as funds
• The share price exceeds 2 USD
• Their market capitalisation ranges from 2 to 10 billion USD
• The annual stock returns is over 20%

The market capitalisation of the companies was valid as of the time of writing.

1. Companhia Siderúrgica Nacional – 15.33%

Founded in: 1941

Registered in: Brazil

Headquarters: Sao Paulo, Sao Paulo

Sector: basic materials

Platform: NYSE

Market capitalisation: 5.24 billion USD

Companhia Siderúrgica Nacional (NYSE: SID) produces steel, cast iron, rolled metal, pipes and iron-ore concentrate. The company is the largest steel producer in Brazil and one of the leaders in the world’s steel industry.

According to the Q3 2023 report, revenue for July to September inclusive rose by 2% compared to the results for the same period in 2022, reaching 11.13 billion BRL (2.23 billion USD), while net profit decreased by 62%, down to 91 million BRL (18.2 million USD).

Technical analysis of Companhia Siderúrgica Nacional stock

Companhia Siderúrgica Nacional shares gained a foothold above the upper boundary of a Double Bottom reversal pattern at 3.70 USD on 18 December 2023. This signal may suggest the completion of the pattern formation, which is why it can be assumed that its target will likely be at the 5.25 USD level.

However, buyers must avoid a breakout of the support level at 3.70 USD to achieve this. A rebound from the support level on the RSI serves as an additional signal in favour of potential price growth. A previous rebound was observed on 13 December 2023, resulting in a price rise of 13.45%.

A negative scenario for buyers could be a price drop below 3.30 USD, triggering a further stock price decline to the next support level at 2.65 USD.

Technical analysis of Companhia Siderúrgica Nacional stock*

Analysts’ forecasts for Companhia Siderúrgica Nacional stock in 2024

• According to Business Insider, one out of two analysts assigned a Buy rating to the Brazilian company’s stock, while one designated a Sell rating, with a maximum price target of 4.10 USD
• Based on Investing data, one out of four experts rated these shares as Buy, one as Sell, and two as Neutral, with an average 12-month price target of 3.00 USD
• As Tipranks reports, Companhia Siderúrgica Nacional stock was given a Buy rating, with an average price target of 4.10 USD

2. International Seaways – 12.74%

Founded in: 2016

Registered in: the US

Headquarters: New York, New York

Sector: energy

Platform: NYSE

Market capitalisation: 2.28 billion USD

International Seaways Inc. (NYSE: INSW) is engaged in oil and oil product transportation for the US, European, Asian, and Middle Eastern markets and owns 77 tankers.

As the Q3 2023 report indicates, revenue for January to September inclusive increased by 55.94% from the corresponding period of 2022, reaching 821.04 million USD, and net profit surged by 150.40% to 424.33 million USD or 8.65 USD per share.

Technical analysis of International Seaways stock

International Seaways Inc. quotes rebounded from the uptrend line at 42.20 USD on 13 December 2023, potentially signalling pressures from buyers and an uptrend. The price will likely test the resistance level of 48.60 USD in the short term. If the quotes break it, this will probably indicate further growth to 53.35 USD.

A signal confirming the development of an upward movement can be a rebound of the RSI values from the support level on 13 December 2023. A previous rebound from this line on the RSI was observed on 7 September 2023, propelling the price by more than 27%. However, the RSI values may face resistance from a descending trend line near the 53.35 USD mark on the price chart, introducing potential correction risks.

Buyers may face a negative scenario if the quotes rebound from the 48.90 USD level and drop to 42.00 USD, which could trigger a decline to 35.00 USD.

Technical analysis of International Seaways Inc. stock*

Analysts’ forecasts for International Seaways stock in 2024

• According to Business Insider, all fifteen analysts rated the shipping company’s stock as a Buy, with a maximum target price of 65.00 USD
• Based on information from Investing, all eight experts assigned a Buy rating to the stock, with an average 12-month price target of 61.25 USD
• As Tipranks reports, International Seaways Inc.’s stock was rated as a Buy, with an average price target of 59.67 USD

3. Frontline – 12.29%

Founded in: 1985

Registered in: Cyprus

Headquarters: Limassol, Cyprus

Sector: energy

Platform: NYSE

Market capitalisation: 4.6 billion USD

Frontline plc (NYSE: FRO) specialises in maritime transportation of crude oil and oil products. Based on the Q3 2023 report, revenue from January to September inclusive rose by 55.48% compared to the same period in 2022, reaching 1.41 billion USD. Net profit soared by 127.52%, reaching 538.04 million USD or 2.42 USD per share.

Technical analysis of Frontline stock

On 18 December 2023, Frontline plc shares established themselves above the upper boundary of a descending corrective channel. Presumably, there are conditions for forming an Inverse Head and Shoulders pattern.

In this scenario, quotes may fall to 19.70 USD, where the completion of the pattern’s right shoulder is likely. Price consolidation above 23.00 USD may suggest completing the entire pattern, with a potential pattern target at 27.00 USD.

A rebound from the trendline on the RSI near the 18.05 USD mark on 13 December 2023 could be interpreted as an additional signal supporting the potential development of the ascending scenario. A similar rebound on 14 September 2023 led to a 47.85% increase in quotes.

A negative scenario for buyers could be a price drop below 18.30 USD, which could lead to the formation of a Double-Top reversal pattern, with the target at 13.45 USD.

Technical analysis of Frontline plc stock*

Analysts’ forecasts for Frontline stock in 2024

• According to Fintel, one out of nine experts rated Frontline plc’s stock as Strong Buy, four as Buy, and four as Hold, with an average 12-month price target of 22.69 USD
• As Investing reports, five out of nine experts designated a Buy rating for the shares, while four gave a Hold rating, with an average 12-month price target of 24.01 USD
• Based on Tipranks data, three out of six specialists assigned a Buy rating to Frontline plc’s stock, and three rated it as Hold, with an average price target of 27.44 USD

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4. Civitas Resources – 10.59%

Founded in: 1999

Registered in: the US

Headquarters: Denver, Colorado

Sector: energy

Platform: NYSE

Market capitalisation: 6.67 billion USD

Civitas Resources Inc. (NYSE: CIVI) produces oil and gas across four states in the US.

According to the Q3 2023 report, revenue from January to September inclusive decreased by 20.98% compared to the same period in 2022, down to 2.35 billion USD. Net profit fell by 50.17%, down to 481.42 million USD or 5.75 USD per share.

Technical analysis of Civitas Resources stock

Since 29 August 2022, Civitas Resources Inc.’s shares have been rising within a bullish channel. On 22 December 2023, the price breached a descending trendline at 69.69 USD, potentially signalling the end of a bearish correction.

The nearest growth target for buyers could be the resistance level at 78.05 USD. Its breakout will probably open the way to a high of 86.58 USD recorded on 18 September 2023. The RSI values consolidating above the upper boundary of the Triangle pattern may serve as an additional signal in favour of potential quote growth.

A negative scenario for buyers can be a price drop below 66.00 USD, indicating a breakout of the lower boundary of the bullish channel and a potential decline to 60.00 USD.

Technical analysis of Civitas Resources Inc. stock*

Analysts’ forecasts for Civitas Resources stock in 2024

• As Fintel reports, five out of sixteen analysts rated Civitas Resources Inc.’s shares as Strong Buy, nine as Buy, and two as Hold, with an average 12-month price target of 97.00 USD
• Based on information from Investing, nine out of ten experts assigned a Buy rating to the stock, with one giving a Hold rating and an average 12-month price target of 93.30 USD
• As Tipranks reports, five out of six specialists gave the oil and gas corporation’s shares a Buy recommendation, while one designated a Hold rating, with an average price target of 99.67 USD

5. Blue Owl Capital – 10.56%

Founded in: 2015

Registered in: the US

Headquarters: New York, New York

Sector: financial

Platform: NYSE

Market capitalisation: 5.9 billion USD

Blue Owl Capital Corporation (NYSE: OBDC) specialises in investments and asset management for private investors and companies. According to the Q3 2023 report, total investment income for January to September inclusive rose by 37.51% compared to the same period in 2022, reaching 1.17 billion USD. Net profit soared by 120.19% to 604.35 million USD or 1.55 USD per share.

Technical analysis of Blue Owl Capital stock

Blue Owl Capital Corporation shares are aggressively rising despite the critical RSI values hovering near 75. A previous test of this level was observed on 13 June 2023, resulting in a price decline of 7.30%.

Although the critical level had already been tested three times from 14 November to 19 December 2023, the price did not drop, which could indicate mounting pressures from buyers. This suggestion could be supported by a breakout of the upper boundary of the ascending channel near 14.90 USD recorded on 8 December 2023. The growth target may be the 17.15 USD level.

A negative scenario for buyers could be a price drop below 14.25 USD, indicating price retracement within the boundaries of the ascending channel and a decline to its lower boundary at 13.05 USD.

Technical analysis of Blue Owl Capital Corporation stock*

Analysts’ forecasts for Blue Owl Capital stock in 2024

• According to Fintel, six out of eighteen analysts rated Blue Owl Capital Corporations stock as Strong Buy, ten as Buy, one as Hold, and one as Sell, with an average 12-month price target of 15.85 USD
• Based on information from Investing, eight out of twelve experts designated a Buy rating for the shares, with four giving a Hold rating. The average 12-month price target is 16.07 USD
• As Tipranks reports, all seven specialists have given the investment company’s stock a Buy recommendation, with an average price target of 15.71 USD

Benefits of investing in high dividend yield stocks

• Stable income stream. Regular dividend payouts can provide investors with confidence in receiving a consistent income from their investments
• Passive income. Investors can receive dividends without actively participating in asset management
• Hedge against inflation. Dividends can, to some extent, counteract the impact of inflation on investment
• Potential capital growth. Investors may capitalise on earnings not only from regular dividend payments but also from the potential appreciation of these stocks
• Opportunity for reinvestment. The dividends received may be reinvested to purchase additional shares, creating favourable conditions for future capital and dividend yield growth
• Reliability and confidence. Companies with high dividend yields typically have stable businesses and leaders in their industries, instiling investor trust in them as reliable assets

Investment strategies for dividend stocks

• Long-term investment. This strategy involves buying shares of dividend-paying companies and holding them for an extended period, such as five to ten years. The goal is to achieve a stable income from dividends and potential appreciation of these stocks
• The purchase of shares ahead of a dividend reduction. This strategy assumes that stock prices may decrease before the announcement of a dividend reduction. Investors may then acquire these shares at a better price, anticipating a potential recovery and increased dividend payments, as well as future stock appreciation
• The purchase of shares after dividend payouts. This strategy involves purchasing stocks after dividends have been paid. The stock value may typically fall after dividend payouts, allowing investors to buy shares at a lower price. Adopting this approach, investors focus on the potential increase in stock value and future dividend payouts

We have outlined several popular investment strategies for investing in dividend stocks. For more detailed information, please refer to the article Dividend Investment Strategies: Real Cases. It is crucial to remember that the choice of a specific strategy depends on the investor’s investment goals, risk tolerance, and financial capabilities.

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Conclusion

In 2023, notable companies with the highest dividend yields included Companhia Siderúrgica Nacional, International Seaways Inc., Frontline plc, Civitas Resources Inc., and Blue Owl Capital Corporation. The first company represents the primary materials sector, the following three operate in the energy industry, and the fifth belongs to the financial sector. A high dividend yield often signifies stable business operations and the ability of the firm to generate profits for dividend payments.

Notably, among experts covering the top-performing stocks, only three recommend selling these securities. As of the article’s writing, the upper limits of the average target price range for these companies’ stock were 4.10 USD, 65 USD, 27.44 USD, 99.67 USD, and 16.07 USD, respectively. This indicates a potential appreciation of 3.80%, 39.46%, 32.75%, 40.20%, and 6.35% from the closing prices on 26 December 2023.

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