We recently published an article titled These Were Last Week’s 10 Best Dividend Stocks. In this article, we are going to take a look at where Phillips 66 (NYSE:PSX) stands against the other dividend stocks.
Investors focused on income have highly preferred dividend stocks for a long time because of their stability. However, these stocks have become more sensitive to the changes in the markets recently, impacting the value of the investments. Reviewing the performance of the companies now and then would allow the investors to make better investment decisions, thus protecting the investment value. Here, we have compiled a list of best performances from some of the high dividend-paying companies. Please stick with us as we count down these stocks from 10 to 1, as it may help you make informed investment decisions.
The second week of February 2025 proved favorable for multiple dividend stocks. Some companies are showing strong financial performance despite the unfavorable economic environment in the concerned industry. Many of our list’s stocks benefit from substantial earnings reports, favorable industry conditions, or market trends like easing inflation. This necessitates investors to select companies based on attractive yields and rely on the growth potential of their values in the long run.
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Many investors consider dividend stocks safe investments, mainly when the market is uncertain. Companies making consecutive dividend payments have stable cash flows. However, it is essential to remember that not all dividend stocks are created equal. Among these dividend stocks, some may perform better than others by leveraging their ability to generate sustainable earnings. These companies can maintain reasonable payout ratios, which later help them capitalize on market opportunities. Our list of last week’s top 10 dividend stocks exemplifies these traits. The list will exemplify what investors should look for when drafting their dividend-focused portfolio.
Before going through the list, it must be remembered that it is not just about celebrating the winners from last week. It also aims to create a learning opportunity for the investors. The characteristics of these high-performing dividend stocks must be studied alongside their strategies. This helps investors in gaining an understanding that enhances their portfolios. They can identify industries that are incurring high growth. They can recognize the importance of financial management in these companies. The experience obtained by investors regarding the influence of external factors on the stocks’ performances could also be invaluable.
While reviewing this list, it is crucial to remember that the stocks on the list are only one week’s performance. It does not reflect the prospects of the company. This performance could go high or low in the future, depending on the external market conditions, industry-specific challenges, and the company’s capabilities. Additional research and caution are advised before making investment decisions.
Our Methodology
We came up with our list of last week’s 10 best dividend stocks by analyzing the market performance from February 10 to February 14. Our focus was on companies meeting two key criteria: a minimum dividend yield of 2% and a share price increase of at least 3% during the period. With this, we selected the stocks combining substantial dividend payouts and short-term growth, offering our readers a curated list of high-performing investment opportunities. The stocks are ranked according to their dividend yields.
Also, at Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 363.5% since May 2014, beating its benchmark by 208 percentage points (see more details here).
A refinery manager walking through an array of pipes and pumping systems, recognizing the company’s vast refining power.
Phillips 66 (NYSE:PSX)
Dividend yield: 3.53%
Dividend payout ratio: 90.18%
Ex-Dividend Date: February 24, 2025
Number of Hedge Funds: 40
The stock price of Phillips 66 (NYSE:PSX) climbed by 5.32% over the last week from February 10 to February 14, 2025.
The company has been increasing its ownership of DCP midstream to achieve its EBITDA goal of $14 billion before the end of 2025. Additionally, the company’s advancement in low-carbon fuels also contributes to its market value growth. As part of the advancement, Phillips 66 (NYSE:PSX) signed an agreement to supply sustainable aviation fuel (SAF) to United Airlines at Chicago O’Hare International Airport (ORD) and Los Angeles International Airport (LAX). The agreement initially involved a supply of 3 million gallons of SAF for use at ORD. However, both parties expect an increase in the supply to 8 million gallons through the first half of 2025, creating value for the company.
Phillips 66 (NYSE:PSX) offers a dividend yield of 3.53%, with a dividend payout ratio of 90.18%. Though the company covers its dividend payments with earnings, the payout ratio suggests that it can retain less than 10% of its profits. With 40 hedge fund portfolios owning stakes in the company at the end of Q3 2024, as per Insider Monkey, institutional interest in the stock appears stronger than most companies on our list. Dividend-focused investors can purchase shares before February 24, 2025, the ex-dividend date.
Overall PSX ranks 7th on our list of last week’s best dividend stocks. While we acknowledge the potential for PSX as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PSX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.