Income investors aiming to boost their portfolio going into the last quarter of the year will want to use August as a month to invest in dividend stocks. There are a few stocks on a downward trend that can provide gains to the smart investor willing to add a little risk to their portfolio.
1. GlaxoSmithKline (GSK)
GlaxoSmithKline has suffered from declining sales of Advair, a respiratory product, and the company has undergone a series of failed trials. The bad news has caused the company to suffer from a debt-to-equity ratio of 259% and a 12-month payout of 681%, which is not sustainable in the long-term.
Tivicay, the company’s HIV drug helped boost the company’s profits in the second quarter, and the company raised their yearly guidance as a result.
The double digit growth may not be enough to keep payout ratios at $0.57 a share quarterly, but the company’s management did announce the intention of keeping dividends at this level through 2017.
A rebound in performance and a 5.18% dividend payout makes this an attractive choice for an investor that doesn’t mind a little risk in their portfolio.
2. PepsiCo (PEP)
PepsiCo is a giant of a company, and with 22 brands that earn over $1 billion in global revenue, the company is diverse enough to withstand consumers that are moving to health conscious drink choices.
The company has anticipated the change, with “guilt-free” products representing 45% of the company’s revenue.
New products account for 9% of the company’s revenue. The company has offered dividends for every year since 1965, with growth of 44 years straight. The beverage giant raised their dividend by 7% this year offering yields of 2.8% on the year.
The most impressive thing about Pepsi is the company’s willingness and ability to change their product lineup quickly to ensure profitability in a market where sugary drinks are on the decline.
