T: 2 Top-Rated S&P 500 Stocks That Pay More Than a 7% Dividend Yield – StockNews.com

October started with a highly volatile stock market due to uncertainties around potential monetary policy changes and supply chain constraints. However, the major stock indexes performed well later, with a solid start to the third-quarter earnings season, a decline in initial jobless claims, and declining COVID-19 cases.

The Dow Jones Industrial Average and S&P 500 closed at record highs on Monday. According to FactSet, of the 23% S&P 500 companies that had reported earnings as of October 22, 84% have exceeded consensus EPS estimates, which is above the 76% five-year average.

However, given the supply chain disruptions and rising inflation, the market may witness further volatility. Therefore, since dividend-paying stocks can reduce overall portfolio risk and volatility, we think they could be ideal bets now. Considering the S&P 500s solid performance and expected market volatility in the near term, it could be wise to add S&P 500 members AT&T Inc. (T) and Altria Group, Inc. (MO) to ones portfolio. The dividends paid by these stocks yield more than 7%.

AT&T Inc. (T)

Incorporated in 1983, T in Dallas, Tex., offers telecommunications, media, and technology services. The company operates through three segmentsCommunications; WarnerMedia; and Latin America. Its segments offer wireless and wireline telecom, video and broadband services, advertising services, and wireless services in Mexico.

T declared a $0.52 quarterly dividend, payable on November 1, 2021. The stock distributes a $2.08 per share dividend annually, which translates to an 8.11% yield. The companys dividend has grown at a 1.6% rate over the past five years.

This month, T and Frontier Communications entered a strategic partnership to deliver fiber-optic connections to large enterprise clients outside of Ts current footprint. With this collaboration, T intends to provide high-speed, low-latency, and highly secure access to large corporate customers in markets where it does not currently own or plan to develop a fiber network.

Ts net income increased 98% year-over-year to $6.27 billion for the third quarter ended September 30, 2021. The companys total operating revenues under the Communications Segment grew 3.8% from its year-ago value to $28.22 billion. Its revenue under the Mobility sector rose 7% from the prior-year quarter to $19.1 billion. Also, under this segment, the companys EBITDA increased 3.6% year-over-year to $7.99 million.

T has an impressive earnings surprise history; it beat the consensus EPS estimates in each of the trailing four quarters. Also, its EPS is expected to grow 5% in the current year. Its stock price has increased 1.2% in price over the past five days.

Ts strong fundamentals are reflected in its POWR Ratings. The stock has an overall B rating, which equates to a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 distinct factors, each with its own weighting.

Also, the stock has a B grade for Value and Stability. Weve also graded T for Sentiment, Momentum, Growth, and Quality. Click here to access all of Ts ratings. T is ranked #2 of 21 stocks in the Telecom Domestic industry.

Altria Group, Inc. (MO)

MO manufactures and distributes cigarettes, oral tobacco products, and wine in the United States. The Richmond, Va., company offers products under the Marlboro, Black & Mild, Copenhagen, Skoal, Red Seal, and Husky brands. In addition, MO provides finance leasing services primarily to the transportation, power generation, real estate, and manufacturing equipment industries.

MO paid a $0.9 quarterly dividend on October 12, 2021. The stock distributes a $3.6 per share dividend annually, which translates to a 7.51% yield. The companys dividend has grown at an 8.6% rate over the past five years.

During the second quarter, ended June 30, 2021, MOs net revenues increased 8.9% year-over-year to $6.94 billion. The companys gross profit grew 13.5% from its year-ago value to $3.73 billion. Its operating income rose 13.9% from the prior-year quarter to $3.19 billion. Also, the companys net earnings increased 10.9% year-over-year to $2.15 million.

MOs revenue is expected to increase 1.9% year-over-year to $21.24 billion in its fiscal year 2021. The company has an impressive earnings surprise history; it beat consensus EPS estimates in three of the trailing four quarters. Also, its EPS is expected to increase 6% in the current year. Furthermore, the stock has gained 14.3% in over the past nine months and 22.7% over the past year.

MOs POWR Ratings reflect this promising outlook. The stock has an overall B rating, which equates to a Buy in our proprietary rating system. Also, the stock has an A grade for Quality, and a B for Stability and Momentum.

In addition to the POWR Rating grades Ive just highlighted, one can see MOs ratings for Value, Sentiment, and Growth here. The stock is ranked #4 of 11 stocks in the Tobacco industry.

T shares were trading at $25.64 per share on Tuesday morning, down $0.00 (0.00%). Year-to-date, T has declined -4.21%, versus a 23.76% rise in the benchmark S&P 500 index during the same period.

Priyanka is a passionate investment analyst and financial journalist. After earning a master's degree in economics, her interest in financial markets motivated her to begin her career in investment research. More...

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T: 2 Top-Rated S&P 500 Stocks That Pay More Than a 7% Dividend Yield - StockNews.com