As tumultuous markets continue to create uncertainty for investors, seeking out dividend-paying stocks can provide stability and reliable income. One such stock that stands out among Wall Street analysts is tech giant IBM. Despite announcing mixed first-quarter results, IBM's earnings surpassed expectations, while revenue fell short due to macroeconomic challenges. In addition, the company recently acquired cloud software maker HashiCorp for $6.4 billion. IBM paid dividends of $1.5 billion in the first quarter and generated free cash flow of $1.9 billion in Q1 2024. The company is expected to deliver free cash flow of about $12 billion for the full year, with a dividend yield of approximately 4%.
Evercore analyst Amit Daryanani remains bullish on IBM, reiterating a buy rating with a price target of $215. Daryanani highlights IBM's growth levers and its potential to benefit from various tailwinds, such as generative artificial intelligence and the acceleration of consulting revenue. While the consulting business faced challenges in Q1 2024, Daryanani is optimistic about future growth fueled by generative AI ramps, backlog conversion, and M&A contributions in the second half of 2024. Notably, Daryanani ranks among the top analysts on TipRanks, with profitable ratings 59% of the time and an average return of 13.2%.
Another dividend stock worth considering is toymaker Hasbro, which reported better-than-expected first-quarter earnings following its turnaround initiatives. Hasbro paid dividends totaling $97.2 million in Q1 2024, offering a dividend yield of 4.7%. JPM analyst Christopher Horvers upgraded Hasbro to a buy rating with a price target of $74, citing the company's cost efficiency efforts and digital gaming prospects that are likely to drive growth in the coming months. As industry outlook improves and Hasbro's strategic initiatives align, Horvers anticipates a positive trajectory for the stock.
Despite facing challenges like a shortened holiday season, Hasbro appears well-positioned for growth in 2024, particularly due to the shift of Transformers and enhanced merchandising strategies. Horvers, a respected analyst on TipRanks, has delivered successful ratings 60% of the time, with an average return of 7.2%.
Lastly, big-box retailer Target presents another attractive dividend opportunity. In the first quarter of 2024, Target distributed $508 million in dividends to shareholders, offering a dividend yield of 2.8%. Despite slightly missing analysts' EPS expectations, Baird analyst Peter Benedict remains optimistic about Target's prospects. He believes that the post-earnings selloff in TGT stock is unwarranted and attributes it to higher operating expenses and price adjustments. Benedict commends Target's strategic focus on value and affordability, emphasizing its prudent planning and commitment to restoring positive comparable sales growth.
Looking ahead, Benedict is confident that Target's risk/reward profile remains compelling. He reaffirmed a buy rating on the stock with a price target of $190. With a track record of profitable ratings 68% of the time and an average return of 15.1%, Benedict stands out as a top analyst on TipRanks.
Dividend stocks like IBM, Hasbro, and Target offer investors an opportunity to navigate volatile markets while ensuring a steady income stream. By leveraging the insights and recommendations of seasoned Wall Street analysts, investors can make informed decisions to build a resilient and profitable portfolio.