Stocks have been under pressure for a while now, as concerns grow over a slowing economy. Ongoing geopolitical tensions have resulted in a surge in oil prices, which has led to a rise in inflation.
Also, fears grew last week that the Federal Reserve could finally hike interest rates next month after August jobs data came in hotter than expected. This could keep markets volatile for a longer period.
With market uncertainty still weighing on investors, those looking for assured income and a degree of protection from market volatility may want to consider dividend-paying stocks.
Dividend stocks can offer a steady income stream through regular payouts while potentially providing greater stability during periods of market turbulence. Here are three dividend stocks worth considering: Farmers National Banc Corp. FMNB, MGE Energy, Inc. MGEE and Napco Security Technologies, Inc. NSSC.
Markets Under Pressure
A hotter-than-expected August jobs report released last week has raised expectations that the Fed will go for a 25-basis-point rate hike in its FOMC meeting next month. Nonfarm payrolls jumped 162,000 in August, sharply higher than the consensus estimate of a rise of 53,000, the Bureau of Labor Statistics reported on Friday.
Meanwhile, the unemployment rate remained unchanged at 4.1%. Inflation remains stubbornly high despite slowing over the past two months after oil prices somewhat eased. However, an escalation in tensions in the Middle East has seen oil prices climbing again, which has raised fears that inflation could increase once again if energy costs continue to stay high.
A rise in interest rates will further raise borrowing costs, which could affect consumers' spending power and habits and weigh on the economy.
These concerns have driven consumer confidence to fall sharply over the past several months. Consumer confidence slid to 89.4 in August, the lowest level since January, from a downwardly revised 90.2 in the month earlier.
3 Stocks That Recently Announced Dividend Hikes
Farmers National Banc Corp.
Farmers National Banc Corp. is a one-bank holding with only one subsidiary, The Farmers National Bank of Canfield. FMNB operates in one industry, domestic banking. Farmers National Banc Corp. is a full-service national bank engaged in commercial and retail banking. FMNB’s commercial banking services include checking accounts, savings accounts, time deposit accounts, commercial, mortgage and installment loans, home equity loans, home equity lines of credit, night depository, safe deposit boxes, money orders, bank checks, automated teller machines and travelers checks. Farmers National Banc Corp. has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
On Aug. 25, Farmers National Banc Corp. announced that its shareholders would receive a dividend of $0.18 a share on Sept. 30. FMNB has a dividend yield of 4.23%. Over the past five years, Farmers National Banc Corp.has increased its dividend four times, and its payout ratio presently sits at 40% of earnings. Check Farmers National Banc Corp.’s dividend history here.
MGE Energy
MGE Energy, Inc. is a public utility holding company. MGEE’s principal subsidiary, MGE, generates and distributes electricity to more than 128,000 customers in Dane County, Wisconsin (250 square miles) and purchases, transports and distributes natural gas to nearly 123,000 customers in seven south-central and western Wisconsin counties (1,375 square miles). MGE Energy has a Zacks Rank #2.
On Aug. 21, MGE Energy declared that its shareholders would receive a dividend of $0.51 a share on Sept. 15. MGEE has a dividend yield of 2.63%. Over the past five years, MGE Energy has increased its dividend five times, and its payout ratio presently sits at 47% of earnings. Check MGE Energy’sdividend history here.
Napco Security Technologies
Napco Security Technologies, Inc. is engaged in the development, manufacture, distribution and sale of security alarm products and door security devices for commercial and residential installations. NSSC has a Zacks Rank#2.
On Aug. 20, Napco Security Technologies announced that its shareholders would receive a dividend of $0.17 a share on Oct. 2. NSSC has a dividend yield of 1.62%. Over the past five years, Napco Security Technologies has increased its dividend six times, and its payout ratio presently sits at 37% of earnings. Check Napco Security Technologies’ dividend history here.
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MGE Energy Inc. (MGEE): Free Stock Analysis Report
NAPCO Security Technologies, Inc. (NSSC): Free Stock Analysis Report
Farmers National Banc Corp. (FMNB): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).