With the start of a new trading month, it is time, once again, for me to highlight some of my potential stock buys for May. With all the recent market volatility there is no shortage of stocks that are looking seemingly cheaper when compared to the closing months of 2022. This month I have my eye on four potential buys but as we all know Mr. Market can give us fresh buying opportunities at any time and those four potential buys can become five or six. With that being said, let’s take a look at my May stock considerations which are similar to recent considerations from one to four months ago.
No surprise here, I am looking at Verizon Communications Inc. (VZ) once again. I nibbled here a bit for the last four or five months and prices are still looking attractive to me. This stock is trading with a low forward PE of just around 8 and sports a very juicy yield getting close to 7% and a moderate payout ratio of around 51% making this dividend appear to be very safe going forward. I realize that this company may not be a growth machine going forward but what it lacks in growth the current yield makes up for.
And just like last month, I am taking a look at another large telco AT&T Inc. (T). While I have been nibbling on VZ a lot over the past several months T has largely remained off my buy list. However, that juicy yield approaching 6% is enticing me once again. With a reasonably low forward PE around 7 the stock is looking fairly valued in the high teens.
Next, I am considering adding to my small position of UGI Corporation (UGI). With a forward PE around 11 and a yield north of 4%, this stock, like VZ and T, might not deliver amazing capital appreciation but can bolster your passive income stream with relatively high yield.
Finally, I’m taking a look at a name that I haven’t touched for several years, Leggett & Platt, Incorporated (LEG). This is another stock that had a rough start to 2023 and is now sporting a yield just under 5.5% as a result of share price decline. With a comfortable payout ratio of about 76% the dividend still appears to be safe going forward.
What do you think about my stock considerations for May? Clearly, I’m sticking with a lot of similar names for several months in a row now. What are you looking to buy this month? Please let me know below.
Disclosure: Long VZ, T, UGI, LEG
Hi! I looked at 5,10,20 years return on VZ and T. And those were not encouraging.
I would like to see your view point on why you have it in your portfolio?
Thanks In advance!!
Hi Vip,
Purely for current income and not for growth. I mention in the post that it’s for current yield and not growth. Thanks for commenting.