In the current economic climate, where inflation rates are high and the threat of a recession is looming, investors are increasingly looking for ways to give their portfolios a boost. Dividend stocks are an excellent way to do this by providing investors with a passive income from some of the most substantial companies in the current economy.

Where to find the best dividend stocks to invest in 

Finding great dividend stocks in which to invest your money is easier said than done. Companies can change their dividend payment criteria at any time by reducing payments or changing the payment terms. For this reason, you should always be selective when choosing dividends in which to invest.

It is important not to base your investment decisions on the dividend yield alone. You should also analyse the cash flow and balance sheet of any company you intend to invest in, as the companies with a strong financial record tend to be the best options and offer stronger returns on investment.

5 Top dividend stocks for Q4 2022

In this article, we will highlight five top dividend stocks to consider for Q4 2022. The stocks are:

Western Union (WU)

Invesco S&P 500 High Dividend Low Volatility ETF (SPHD)

Lumen Technologies, Inc. (LUMN)

Walgreen Boots Alliance (WBA)

American Express (AXP)

You can find information on how eToro pays dividends to clients who own dividend-paying securities here.

Western Union (WU)

EN Dividend WU Stock Graph

Past performance is not an indication of future results.

  • Western Union Company is an American company operating in the financial services sector. It specialises in money transfer and payment services.
  • The Western Union Company is set to pay a dividend of $0.235 on the 30th of September. Based on this payment, the dividend yield on the company’s stock will be 5.8% (as of August 2022).
  • The company has sustained a solid track record of paying dividend funds with minimal fluctuation. Between 2012 and 2022, its dividend has gone from $0.32 total to $0.94, equalling a compound annual growth rate (CAGR) of approximately 11% a year.
  • Current investors have benefitted from increased dividend payments year-on- year, with earnings per share increasing 42% over the last five years (as of August 2022).
  • In its industry, Western Union continues to be the clear market leader, earning three times more fund capital than its closest competitor , MoneyGram international. In its Q2 report, Western Union reported GAAP revenue of $1.1 billion and with an operating margin of 23.2%.
  • Next earnings release: Q4 results, November 1st, 2022
Year 2019 2020 2021 2022
Dividend per share (cents) 80.00 90.00 94.00 94.00
Dividend yield* 3.89 3.84 3.76 5.84

 

* Yields correct as of August 31st, 2022

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Invesco S&P 500 High Dividend Low Volatility ETF (SPHD)

EN Dividend SPHD Stock Graph

Past performance is not an indication of future results.

  • Invesco is an investment fund management firm operating within the retail and institutional global markets. Its ETF (UHD) asset classes include equity, fixed income, and money markets, among others.
  • The business also provides ETFs (exchange-traded funds), mutual funds, indexing, individual savings accounts and other financial products.
  • For the first quarter of 2022, ending March 31st, Invesco saw its operating income grow by 9.7% year-on-year with an operating revenue decline of 1.8%.
  • The Invesco S&P 500 High Dividend Low Volatility ETF has a $3.8 billion market cap, with flat year-to-date performance and a 0.3% expense ratio.
  • The ETF holdings focus on traditional defensive positions, for example,  utilities and consumer staples plus financial products and considerable holdings in the energy sector.
  • SPHD enjoys a dividend yield of 3.71% and paid $1.66 per share in the past year. The dividend is paid monthly, and the last ex-dividend date was August 22nd, 2022.
  • The screening methodology looks at value-oriented stocks with a low volatility profile history.
  • Next earnings release: Q4 results, September 19th, 2022.
Year 2019 2020 2021 2022
Dividend per share (dollars) $1.79 $1.8388 $1.56 $1.66
Dividend yield* 4.42 4.07 4.89 3.71

 

* Yields correct as of August 31st, 2022

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Lumen Technologies, Inc. (LUMN)

EN Dividend LUMN Stock Graph

Past performance is not an indication of future results.

  • Lumen Technologies, Inc. is an international company operating under Lumen, Quantum and CenturyLink. The company provides communication services including networking, cloud hosting, and telecommunication systems.
  • Lumens stock has seen a decline of 23% in 2022. However, this shouldn’t be considered a disappointing performance compared to the S&P 500 Index, which Lumen outperformed.
  • Lumen is in the midst of a reorganisation. The business is looking at divesting some of its less profitable assets and reinvesting in ways that enhance its business. The company officially closed its Latin American operations for $2.7 billion cash. This follows the sale of local incumbent carriers in twenty states to Apollo Funds for $7.5 billion.
  • Lumen continues to invest heavily in upgrading copper wires to fibre in its remaining telecommunications business, increasing its reach from 2.6 million addresses up to 12 million or more. This is likely to boost Lumen’s broadband business significantly.
  • Lumen’s current dividend yield sits at 9% (as of August 2022).
  • Next earnings release: Q4 results, November 2nd 2022.
Year 2019 2020 2021 2022
Dividend per share (dollars) $1.00 $1.00 $1.00 $1.00
Dividend yield* 6.9 9.1 8.35 10.04

 

* Yields correct as of August 31st, 2022

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Walgreen Boots Alliance (WBA)

EN Dividend WBA Stock Graph

Past performance is not an indication of future results

  • Walgreen Boots Alliance (WBA) are operators of retail pharmacies that offer health and beauty products  — they have been in the healthcare business for over 170 years.
  • The company’s stocks are currently down -31%. However, this is not unexpected given that it is a retail business, and investors are concerned that inflation might affect the company’s overall success. This is coupled with the fact that the company is experiencing lower footfall as the number of shoppers visiting the stores for COVID-19 vaccines is declining.
  • WBA offers a stable and well-protected dividend investment. The company raised its dividend by 2.1% in 2021 to $0.4475 per quarterly share. This marked the 46th year that WBA has increased its dividend. In the last ten years alone, the Walgreen Boots Alliance has upped its dividend payments by 74%.
  • At the time of writing, WBA’s dividend is 4.53%, which is above the average we see across the S&P 500 (August 2022).
  • The company continues to take steps to improve its profitability. Earlier this year, the business sold 6 million AmerisourceBergen shares for approximately $900 million. According to WBA, it will use the money to pay off debts and support its strategic priorities.
  • Next earnings release: Q4 results, October 13th, 2022
Year 2019 2020 2021 2022
Dividend per share (dollars ) $1.78 $1.84 $1.88 $1.91
Dividend yield* 3.48 4.52 3.96 5.01

 

* Yields correct as of August 31st, 2022

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American Express (AXP)

EN Dividend AXP Stock Graph

Past performance is not an indication of future results.

  • Founded in 1850, the global company, American Express AXP deals in credit, charge cards and travel-related products and services..
  • American Express has had a track record of raising or maintaining dividends through every economic environment over the last couple of decades. This can be credited to the high lending standards and the company’s target market of  higher-income earners or those likely to fall into debt during economic downturns.
  • Most financial retailers have reported pressures during 2022. However, AXP has enjoyed growth during Q2 2022. Amex revenue increased 31% year-on-year.
  • AXP’s dividend yield is 1.35% at the current price (as of August 2022). While  this is below the S&P 500 average of 1.59%, American Express stock is outperforming the S&P 500 this year. The dividend yield is inversely correlated with stock pricing.
  • American Express dividends have increased 160% over the last ten years, making them a solid choice for anyone looking for a secure dividend stock that can weather almost any economic condition.
  • Next earnings release: October 28th, 2022.
Year 2019 2020 2021 2022
Dividend per share (dollars) $1.56 $1.72 $1.72 $1.90
Dividend yield* 1.38 1.3 1.03 1.37

 

* Yields correct as of August 31st, 2022

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