Dividend champ Dover Corp. ( DOV ) will look to extend its lengthy 62-year streak of dividend increase when it announces its next dividend this week. The stock currently offers a 2.35% yield, with shares falling 19.6% on the year.
DOV was recently trading at $81.77 down $27.29 from its 12-month high and $10.06 above its 12-month low. InvestorsObserver's Stock Score Report gives DOV a 92 long-term technical score and a 77 short-term technical score. The stock has recent support above $80 and recent resistance below $83. Of the 16 analysts who cover the stock 4 rate it Strong Buy, 1 rate it Buy, and 11 rate it Hold. DOV gets a score of 80 from InvestorsObserver's Stock Score Report.
DOV has a very impressive streak of dividend increases, and with a payout ratio of just 39.8% the company can easily afford to extend its streak of increases when it announces its next dividend, which could happen as early as this week. Last year the company boosted its dividend by 6.8%, and in the previous year the payout was lifted by 4.7%. I would expect a similar increase this year, with the quarterly payment rising from $0.47 to $0.50 per share, for a 6.4% increase. Look for the news this week, with the stock trading ex-dividend during the final week of August.
Stock Only Trade
If you want a bullish hedged trade on the stock, consider a 12/21 65/70 bull-put credit spread for a $0.40 credit. That's a potential 8.7% return (22.7% annualized*) and the stock would have to fall 15.0% to cause a problem.
If you want to take a bearish stance on the stock at this time, consider an 10/19/18 95/100 bear-call credit spread for a $0.25 credit. That's a potential 5.3% return (25.0% annualized*) and the stock would have to rise 16.4% to cause a problem.
Covered Call Trade
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Originally published on InvestorsObserver.com