Bank of America: Dividend Stocks Poised to Outperform as Recovery Gains Steam
• Bank of America strategists believe the market recovery has staying power due to strengthening earnings, GDP forecasts, economic indicators, and Treasury yield stability.
• Value stocks, small caps, and dividend-paying stocks tend to perform best during recoveries. Firms with generous dividends lead the market higher in 88% of recoveries.
• Dividends will likely be a bigger driver of returns in coming years as cash yields have dropped and earnings multiples have expanded.
• High-yielding stocks are relatively cheap because they are being neglected by active managers.
• Bank of America shared a list of 134 stocks with solid, above-market dividend yields trading at a discount for investors to consider.