2 Buy-Rated Stocks That Recently Declared a Dividend Increase

NYSE: CAH | Cardinal Health, Inc.  News, Ratings, and Charts

CAH – Because recession concerns could keep the overall stock market under pressure in the near term, it could be wise to bet on dividend stocks to secure a steady portfolio income stream. So, we think it could be wise to scoop up shares of Cardinal Health (CAH) and Phillips 66 (PSX), which recently declared dividend increases. These stocks are rated “Buy” in our proprietary rating system. Read on.

The stock market has witnessed a massive sell-off of late on concerns over the Fed’s aggressive interest rate increases to fight multi-decade-high inflation. A potential slowdown in consumer spending, continuing geopolitical tensions, rising energy prices, and intensifying supply disruptions have fostered bearish investor sentiment.

According to JPMorgan Chase CEO Jamie Dimon, the chances of the Fed curbing inflation without instigating a recession stand at 33%. Amid this situation, investors could turn toward dividend-paying stocks to hedge their portfolios against short-term market volatility by ensuring a steady income stream.

So, we think it could be wise to bet on dividend-paying stocks Cardinal Health, Inc. (CAH) and Phillips 66 (PSX), which recently declared a dividend increase and have a Buy rating in our proprietary POWR Ratings system.

Cardinal Health, Inc. (CAH)

CAH in Dublin, Ohio, operates as an integrated healthcare services and products company internationally. It provides customized solutions for hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories, physician offices, and patients in the home. The company operates in two segments, Pharmaceutical and Medical.

On May 10, 2022, CAH announced that its board of directors approved a quarterly dividend of $0.4957 per share, which is an increase of about 1% from its prior dividend. The dividend will be paid on July 15, 2022, to shareholders of record at the close of business on July 1, 2022.

CAH’s revenue increased 14% year-over-year to $44.80 billion for the fiscal third quarter, ended March 31, 2022. Its dividend pay-outs have grown at a 1.8% CAGR over the past five years and 1% over the past three years. While its four-year average dividend yield is 3.74%, its current dividend translates to a 3.55% yield.

For the current quarter, ending June 30, 2022, analysts expect CAH’s EPS to increase 53.2% year-over-year to $1.18. Its annual revenue is expected to be $178.38 billion in its fiscal 2022, representing a 9.8% year-over-year rise. Over the past six months, the stock surged 15.3% in price to close yesterday’s trading session at $55.83.

CAH’s POWR Ratings reflect this promising outlook. The company has an overall rating of B, which translates to Buy in our proprietary ratings system. The POWR Ratings assess stocks by 118 distinct factors, each with its own weighting.

The stock has an A grade for Growth and a B grade for Value. Within the Medical – Services industry, CAH is ranked #9 out of 84 stocks. To see the additional POWR Ratings for CAH (Momentum, Stability, Sentiment, and Quality), click here.

Click here to checkout our Healthcare Sector Report for 2022

Phillips 66 (PSX)

PSX in Houston, Tex., operates as an energy manufacturing and logistics company. It operates through four segments: Midstream, Chemicals, Refining, and Marketing and Specialties. The Midstream segment transports crude oil and other feedstocks; the Chemicals segment markets ethylene and other olefin products; the Refining segment refines crude oil and other feedstocks into petroleum products; and the M&S segment purchases for resale and markets refined petroleum products.

On May 11, 2022, PSX’s board of directors declared a quarterly dividend of 97 cents per share on its common stock, representing a 5% increase. The dividend is payable on June 1, 2022, to shareholders of record as of the close of business on May 23, 2022. PSX’s Chairman and CEO Greg Garland said, “This dividend increase, along with the recently announced resumption of our share repurchase program, demonstrates our continuing commitment to shareholder returns.”

For its fiscal first quarter, ended March 31, 2022, PSX’s adjusted pre-tax income came in at $845 million compared to a $527 million loss in the previous-year period. The company’s adjusted earnings came in at $595 million compared to a $509 million loss in the prior-year quarter. Also, its EPS was $1.32 compared to a $1.16 loss in the year-ago period.

PSX’s dividend pay-outs have grown at a 7.5% CAGR over the past five years and 14.1% over the past three years. While its four-year average dividend yield is 4.03%, its current dividend translates to a 4.07% yield.

Analysts expect PSX’s EPS and revenue to increase 350% and 71%, respectively, year-over-year to $3.33 and $39.12 billion, for the current quarter ending June 30, 2022. It surpassed the Street’s EPS estimates in each of the trailing four quarters. Over the past nine months, the stock has gained 43.9% to close yesterday’s trading session at $95.33.

PSX’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall B rating, which equates to Buy in our proprietary rating system. It has an A grade for Momentum and a B grade for Growth.

We also have graded PSX for Value, Stability, Quality, and Sentiment. Click here to access all PSX’s ratings. PSX is ranked #17 out of 98 stocks in the B-rated Energy – Oil & Gas industry.


CAH shares were trading at $55.33 per share on Friday afternoon, down $0.50 (-0.90%). Year-to-date, CAH has gained 8.38%, versus a -18.93% rise in the benchmark S&P 500 index during the same period.


About the Author: Nimesh Jaiswal


Nimesh Jaiswal's fervent interest in analyzing and interpreting financial data led him to a career as a financial analyst and journalist. The importance of financial statements in driving a stock’s price is the key approach that he follows while advising investors in his articles. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
CAHGet RatingGet RatingGet Rating
PSXGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


:  |  News, Ratings, and Charts

Recession is Here...Watch Out Below!

More and more it looks like recession is here. This includes a dramatic decline for ISM Manufacturing discovered this morning. As you likely know, most economist call manufacturing the "canary in the coal mine" for the US economy as it often shows weakness before other areas. In fact, GDP Now from the Atlanta Fed reads it loud and clear with a negative revision for the US economy down to -2.1% for Q2. Ouch! We are going to discuss these new economic facts...what it means for the stock market outlook...and an interesting view on why the S&P 500 (SPY) does not decline in orderly fashion. All that and more is coming your way in this week's commentary…

:  |  News, Ratings, and Charts

4 Ideal Stocks to Add to Your Portfolio in July

While sluggish consumer spending data led to the stock market ending the last trading session of June in the red, a moderate inflation forecast is nurturing hopes over the economy to avoid a recession. Therefore, investors might consider buying quality stocks ARC Document Solutions (ARC), Core Molding Technologies (CMT), DLH Holdings (DLHC), and Friedman Industries (FRD) at their current low price levels to benefit from their big rebounds. Read more…

:  |  News, Ratings, and Charts

Stocks to Fall MUCH FURTHER this Bear Market Cycle

Spoiler alert...the bear market is not over. Unfortunately history shows that the S&P 500 (SPY) has much further to fall to squeeze out excess valuation. That is just a natural part of the bear market process that is properly explained in this timely market commentary. More importantly, this commentary provides a strategy on how to profit in the days and weeks ahead as the market finds its way to bottom. Read on below for more...

:  |  News, Ratings, and Charts

Wall Street Analysts Predict More Than 160% Upside in These Stocks

The high global inflation and hawkish federal reserve are leading to heightened volatility in the market. However, despite the market uncertainties, Wall Street analysts see a more than 160% upside potential in IonQ (IONQ) and Rigetti Computing (RGTI). Thus, these stocks could be ideal additions to your watchlist. Keep reading…

:  |  News, Ratings, and Charts

Stocks to Fall MUCH FURTHER this Bear Market Cycle

Spoiler alert...the bear market is not over. Unfortunately history shows that the S&P 500 (SPY) has much further to fall to squeeze out excess valuation. That is just a natural part of the bear market process that is properly explained in this timely market commentary. More importantly, this commentary provides a strategy on how to profit in the days and weeks ahead as the market finds its way to bottom. Read on below for more...

Read More Stories

More Cardinal Health, Inc. (CAH) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All CAH News