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3 Dividend Stocks That Could Soar 43% to 70%, According to Wall Street

The Motley Fool logo The Motley Fool 3/23/2023 Keith Speights
3 Dividend Stocks That Could Soar 43% to 70%, According to Wall Street © Provided by The Motley Fool 3 Dividend Stocks That Could Soar 43% to 70%, According to Wall Street

Attractive quarterly dividends, plus the potential for tremendous share-price growth? Many investors would quickly sign up for such a winning combination. 

To be sure, many dividend stocks aren't likely to deliver huge gains. But there are some notable exceptions. Here are three dividend stocks that could soar 43% to 70% over the next 12 months, according to Wall Street.

1. Devon Energy

Devon Energy's (NYSE: DVN) dividend yield currently stands at 10.5%. That ranks the oil and gas producer among the top five dividend stocks in the S&P 500, based on yield. Devon's fixed-plus-variable dividend more than doubled last year.

Part of the reason why Devon's dividend yield is so high right now, though, is that the stock has fallen quite a bit in recent months. Declining oil prices have taken their toll on the company's share price.

However, Wall Street analysts think that the stock should rebound over the next 12 months. The consensus price target reflects an upside potential of around 42%. Not everyone on Wall Street is that bullish, but 23 of the 32 analysts surveyed by Refinitiv in March rate Devon as a buy or strong buy.

Devon will need higher oil prices to achieve that price target. It could get them. There are several potential catalysts that could push oil prices to $100 per barrel this summer, including a production cut by Russia and a potential reduction by OPEC. 

2. CVS Health

CVS Health (NYSE: CVS) offers a more modest (yet still attractive) dividend yield of 3.2%. The healthcare giant didn't increase its dividend for several years following the 2018 acquisition of Aetna. That's changed since late 2021, though, with CVS boosting its dividend payout by 21%.

So far, 2023 isn't panning out to be a good year for CVS Health stock. Its shares have fallen nearly 20%. One culprit behind this decline is the company's weaker-than-expected earnings guidance for 2023.

Analysts, though, believe that a rebound could be in store for CVS. The consensus 12-month price target for the stock is close to 43% above the current share price. Even the lowest target for CVS represents an upside potential of 26%. 

CVS Health should enjoy a boost in 2024 from its acquisition of Oak Street Health. The deal will enable CVS to move into primary care with Oak Street's 169 medical clinics in 21 states. By 2026, Oak Street expects to have more than 300 clinics.

3. Medical Properties Trust

If you're seeking a truly mouthwatering dividend, Medical Properties Trust (NYSE: MPW) has it. The hospital-focused real estate investment trust (REIT) offers a dividend yield of 14.5%. 

The bad news is that Medical Properties Trust's yield is sky-high, in large part because of its dismal stock performance. The hospital REIT's shares plunged more than 50% in 2022 and are down nearly 30% so far this year.

Analysts appear to be divided about the REIT's near-term prospects. Only 6 of the 14 analysts surveyed by Refinitiv in March rate the stock as a buy or strong buy. Five analysts recommend holding the stock. One analyst thinks it will underperform, while another recommends selling. However, the average 12-month price target for Medical Properties Trust is still 70% higher than the current share price.

Some of Medical Properties Trust's tenants face financial challenges. The good news is that the overall outlook is improving for hospital operators. If Medical Properties Trust proves that it's able to weather the storm in the next few quarters, this beaten-down stock just might rebound as analysts predict with its ultra-high dividend intact.


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Keith Speights has positions in Devon Energy and Medical Properties Trust. The Motley Fool recommends CVS Health. The Motley Fool has a disclosure policy.


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