BofA Securities U.S. quantitative strategist Savita Subramanian listed five reasons that U.S. high-paying dividend stocks are set to outperform in 2024. I’ll describe the five reasons first and at the end discuss the potential applicability to Canadian equity markets.
BofA’s “global wave indicator” tracks industrial and consumer confidence, capacity utilization, unemployment, producer prices, credit spreads and earnings revisions to assess the investing backdrop for global stocks. The global wave has troughed, which has historically indicated a recovery stage for global equities during which high dividend stocks have previously led. This is reason one.
Reason two is that high dividend stocks form an effective investment solution for periods when economic indicators are mixed and higher-risk, earlier recovery asset classes like small caps are not yet outperforming. Dividends generate returns while investors wait for growth-led…
