2 Dividend Stocks to Buy Now With Higher Yields Than the 30-Year U.S. Treasury Bond
Two high-yield consumer stocks offer more income than Treasuries, but are the risks crushing their valuations as bad as investors think?
Overview
The 30-year Treasury bond pays about 5.24% right now, which is a genuinely difficult number for dividend stocks to beat. It is also the highest that benchmark has been in years, well above its 10-year yield average of 4.74%, and it comes with a guarantee from the U.S. government that no company can match. Recently, the U.S. Treasury announced a larger-than-expected $6 billion buyback of longer-dated Treasuries, while Secretary Scott Bessent challenged this week's investors to bet against his yen strategy.
So when a consumer goods stock offers more, the honest question is not "Why is the yield so high?" but "What is the market afraid of, and is that fear correct?" Two consumer names clear the bar today. Each one is priced for something to go wrong. My read is that in two of the three cases, the market has the direction right and the magnitude wrong.
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Originally published at www.fool.com.