The 40-year high inflation and the Fed’s aggressive rate hikes have led to heightened market volatility. The Fed announced a 75-basis-point rate increase earlier this month, marking its most aggressive hike since 1994. Another 75-basis-point hike might be undertaken by the central bank in the coming month, followed by a 50-basis-point increase in September.
The Fed’s hawkish stance raises the possibility of the economy tipping into a recession. However, Jack Ablin, chief investment officer at Cresset Capital, said, “We’re calling for a small ‘r’ recession. It means it’s not going to be protracted, and things aren’t going to fall apart.”
Given the market fluctuations, we think high-dividend stocks Sisecam Resources LP (SIRE), Grindrod Shipping Holdings Ltd. (GRIN), and Alliance Resource Partners, L.P. (ARLP), which are currently trading under $20, could be ideal additions to one’s portfolio to generate a steady income stream.
These stocks are rated Strong Buy or Buy in our proprietary POWR Ratings system.
Sisecam Resources LP (SIRE)
SIRE engages in the trona ore mining and soda ash production businesses in the United States and internationally.
The company’s $1.49 forward annual dividend yields 12.07% at its current share price. It paid its last quarterly dividend of $0.50 on May 18, 2022.
For the fiscal first-quarter ending March 31, 2022, SIRE’s total net sales increased 27.9% year-over-year to $163.40 million. Its adjusted EBITDA grew 151% from the year-ago value to $39.40 million. Net income attributable to SIRE for the quarter stood at $15.70 million, reflecting a 554.2% increase year-over-year. Moreover, the company’s net cash provided by operating activities was $7.70 million, up 220.3% from the prior-year quarter.
Street expects SIRE’s revenue for the ongoing fiscal year ending December 2022 to improve 352.3% year-over-year to $2.44 billion.
The stock has gained 29.5% over the past nine months and 18.3% over the past year to close the last trading session at $16.57.
SIRE’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of A, translating to Strong Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
SIRE also has an A grade in Growth and a B in Value, Stability, Sentiment, and Quality. It is ranked #2 of 92 stocks in the A-rated Chemicals industry.
In addition to the POWR Rating grades I’ve just highlighted, you can see the SIRE’s ratings for Momentum here.
Grindrod Shipping Holdings Ltd. (GRIN)
Based in Singapore, GRIN is an international shipping company that owns, charters-in, and operates a fleet of dry bulk carriers and tankers worldwide.
Its $1.19 forward annual dividend yields 10.06% at its current share price. The company paid its last quarterly dividend of $0.47 on June 20, 2022.
For the fiscal quarter ended March 31, 2022, GRIN’s revenue increased 61.2% year-over-year to $110.29 million. Its adjusted EBITDA from continuing operations grew 137.1% from the year-ago value to $50.16 million. Adjusted net income from continuing operations for the quarter stood at $29.83 million, reflecting a 1,119.3% increase year-over-year. Moreover, its adjusted EPS was $1.56, up 1,100% from the prior-year quarter.
Analysts expect GRIN’s revenue in the fiscal year ending December 2022 to come in at $508.40 million, indicating an increase of 11.5% year-over-year. Its EPS is expected to improve 12.6% year-over-year to $6.63. The company also surpassed the consensus EPS estimates in three of the four quarters.
GRIN’s shares have gained 68.7% over the past year to close the last trading session at $18.69.
GRIN’s sound fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, equating to Buy in our proprietary rating system.
The company also has a B grade in Growth, Momentum, Value, and Sentiment. Out of the 44 stocks in the A-rated Shipping industry, GRIN is ranked #5. To get GRIN’s ratings for Stability, and Quality, click here.
Alliance Resource Partners, L.P. (ARLP)
ARLP, a diversified natural resource company, produces and markets coal primarily to utilities and industrial users in the United States. The company operates through four segments: Illinois Basin Coal Operations; Appalachia Coal Operations; Oil & Gas Royalties; and Coal Royalties.
On May 2, ARLP announced an equity investment in Francis Energy, LLC, the owner and operator of the nation’s first comprehensive statewide network of electric vehicle fast-charging infrastructure.
“The growth of the electric vehicle market in the United States is undeniable, and the need to buildout EV charging infrastructure to support this growth is critical. We view our investment with Francis Energy as an important step in ARLP’s participation in this next-generation energy platform,” ARLP Chairman, President, and Chief Executive Officer Joseph W. Craft III said.
ARLP’s $0.90 forward annual dividend yields 8.15% at its current share price. It paid its last quarterly dividend of $0.35 on May 13.
ARLP’s total revenues increased 44.6% year-over-year to $460.86 million in the fiscal quarter ended March 31, 2022. Net income attributable to ARLP grew 48.1% from the year-ago value to $36.65 million. Also, its EPS came in at $0.28, up 47.4% from the prior-year quarter.
The consensus EPS estimate of $0.94 for the fiscal quarter ending June 2022 represents a 175.5% improvement year-over-year. The consensus revenue estimate of $568.71 billion for the same quarter represents a 56.9% increase from the same period last year.
ARLP’s shares have gained 140.3% over the past year to close the last trading session at $17.18. The stock has gained 36% year-to-date.
ARLP’s POWR Ratings reflect this promising outlook. The company has an overall rating of A, equating to Strong Buy in our POWR Ratings system.
ARLP also has an A grade in Quality and a B in Sentiment and Momentum. It is ranked #4 of 12 stocks in the A-rated MLPs - Other industry. To see additional POWR Ratings for Growth, Value, and Stability for ARLP, click here.
SIRE shares were trading at $17.05 per share on Friday afternoon, up $0.48 (+2.90%). Year-to-date, SIRE has gained 9.36%, versus a -17.29% rise in the benchmark S&P 500 index during the same period.
About the Author: Komal Bhattar
Komal's passion for the stock market and financial analysis led her to pursue investment research as a career. Her fundamental approach to analyzing stocks helps investors identify the best investment opportunities.
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