5 Dividend Growth Stocks With Upside To Analyst Targets

ETF Channel has identified five 'Dividend Aristocrat' stocks, including Albemarle (ALB), Lincoln Electric (LECO), Lancaster Colony (LANC), Target (TGT), and Eversource Energy (ES), that exhibit substantial upside to average analyst 12-month target prices. Despite their status as consistent dividend growers, these companies are not considered 'fully priced' and offer implied total return potentials ranging from 15.34% to 16.93% when combining analyst price targets with current dividend yields. This analysis suggests these specific dividend growth stocks could provide both capital appreciation and ongoing income for investors.

Analysis

An analysis of S&P High Yield Dividend Aristocrats has identified five companies—Albemarle (ALB), Lincoln Electric (LECO), Lancaster Colony (LANC), Target (TGT), and Eversource Energy (ES)—that appear undervalued relative to consensus analyst price targets. These firms, part of the SPDR S&P Dividend ETF, present potential capital appreciation ranging from 12.46% for Eversource to 15.16% for Albemarle. When combined with their respective dividend yields, the implied 12-month total return potential for each stock exceeds 15%, with Eversource and Albemarle showing the highest potential at 16.93% and 16.79%, respectively. However, a critical distinction lies in their recent dividend growth rates. Lincoln Electric stands out with a robust trailing-twelve-month (TTM) dividend growth of 10.94%, while Eversource and Lancaster Colony show moderate growth near 6%. In contrast, the dividend growth for Albemarle and Target has been minimal at 0.63% and 1.84%, a factor that may temper enthusiasm for investors focused on accelerating income streams despite their long-term dividend-paying history.

Key Decisions for Investors

• Investors seeking total return from established dividend payers should consider these five stocks, as analyst targets imply a combination of double-digit capital appreciation and dividend income.