The year 2025 has seen a shaky start. Although stocks closed higher on Friday, all three major indexes ended in negative territory in the first week of the year. Wall Street had a stellar 2024 but markets cooled off in the final weeks, with the Santa Claus Rally failing to materialize.
Volatility cropped up as concerns over the Federal Reserve’s rate cut plans for 2025 grew. Also, investors are not too optimistic about the fourth-quarter earnings season, with several companies issuing poor guidance.
Given this situation, cautious investors looking for a steady income and ways to protecting their capital may want to hold or buy dividend-paying stocks. Three such stocks are Bank OZK OZK, Preferred Bank PFBC and The Mosaic Company MOS.
Volatility Returns to Markets
Markets turned volatile in the final days of December after fresh data showed that inflation rose slightly in November. Although the Federal Reserve’s monetary tightening policy helped curb sky-high inflation to a great extent, it remains high and above the central bank’s 2% target. Also, inflation has been moving sideways over the past few months.
A strong labor market added to the worries of the Federal Reserve, which believes that the economy is still on solid ground. The Federal Reserve has cut interest rates by a total of 100 basis points since September, taking its benchmark policy rate to the range of 4.25-4.5%.
Concerns grew in December after the Federal Reserve gave a hawkish outlook for its rate cuts in 2025 given that the economy has more strength than it believed when it started its rate cut cycle in September. The Federal Reserve said that it now sees just two rate cuts in 2025 if inflation remains elevated.
Higher interest rates mean higher borrowing costs, which could keep markets volatile for a longer period.
3 Stocks that Recently Announced Dividend Hikes
Considering the current situation, investing in dividend-paying stocks would be a wise choice. These companies have stable operations and regularly pay dividends, maintaining profitability through their dependable business models. In a fluctuating market, companies with high dividend payouts typically perform better than those that do not offer dividends.
Bank OZK conducts operations through approximately 240 offices in nine states, including Arkansas, Georgia, Florida, North Carolina, Texas, Tennessee, California, New York and Mississippi. OZK offers a wide range of retail and commercial banking services to businesses, individuals, and non-profit and governmental entities. Bank OZK presently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
On Jan. 3, Bank OZK announced that its shareholders would receive a dividend of $0.42 a share on Jan. 21, 2025. OZK has a dividend yield of 3.73%. Over the past five years, Bank OZK has increased its dividend 21 times, and its payout ratio at present sits at 26% of earnings.Check Bank OZK’s dividend history here.
Bank OZK Dividend Yield (TTM)
Bank OZK dividend-yield-ttm | Bank OZK Quote
Preferred Bank is one of the largest independent commercial banks in California, focusing on the Chinese-American market. PFBC is chartered by the State of California, and its deposits are insured by the Federal Deposit Insurance Corporation, or FDIC, to the maximum extent permitted by law. Preferred Bank presently has a Zacks Rank #3.
On Dec. 26, Preferred Bank declared that its shareholders would receive a dividend of $0.75 a share on Jan. 23, 2025. PFBC has a dividend yield of 3.25%. Over the past five years, Preferred Bank has increased its dividend five times, and its payout ratio at present sits at 28% of earnings.Check Preferred Bank’s dividend history here.
Preferred Bank Dividend Yield (TTM)
Preferred Bank dividend-yield-ttm | Preferred Bank Quote
The Mosaic Company is a leading producer and marketer of concentrated phosphate and potash for the global agriculture industry. MOS is the biggest integrated phosphate producer globally and is also among the four largest potash producers in the world. The Mosaic Company has a Zacks Rank #3.
On Dec. 23, The Mosaic Company announced that its shareholders would receive a dividend of $0.22 a share on Mar. 20, 2025. MOS has a dividend yield of 3.34%. Over the past five years, The Mosaic Company has increased its dividend six times, and its payout ratio at present sits at 38% of earnings.Check The Mosaic Company’s dividend history here.
The Mosaic Company Dividend Yield (TTM)
The Mosaic Company dividend-yield-ttm | The Mosaic Company Quote
Zacks' Research Chief Names "Stock Most Likely to Double"
Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.
This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners UpThe Mosaic Company (MOS) : Free Stock Analysis Report
Preferred Bank (PFBC) : Free Stock Analysis Report
Bank OZK (OZK) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
