Though it's not foolproof investing wisdom, and it is stock-specific, there is something to the "boring is beautiful" thesis. It's one reason that so many income investors and risk-averse market participants embrace consumer staples stocks. The other side of the boring coin is that mundane doesn't captivate hearts, minds, and investor capital when growth stocks are in vogue, and that's very much the case these days.
Many market participants are chasing tech stocks and pondering what's next in the world of artificial intelligence (AI). This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia.
For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue » Those trends don't necessarily mean that Wall Street is in the midst of another round of Dutch tulip mania, nor that a bubble will imminently burst, but investors' adulation for what they perceive as glitzy names helps explain how some defensive stocks can slip through the cracks, even when those companies are delivering solid showings. Such is life for Sysco (NYSE: SYY), the king of food distributors.
Considering that the stock is up 15% year to date and there's been ample talk of market-breadth widening, Sysco arguably isn't getting the respect it deserves. But to be fair, Wall Street isn't completely overlooking the stock: 15 analysts cover it. That's a decent amount, but that crowd has been relatively quiet on Sysco of late.
Still, the stock is a buy this month and for multiple reasons. One of the eye-catchers is Sysco's status as a Dividend King -- one of the few companies that has boosted its annual payouts for at least 50 consecutive years. To be precise, Sysco's dividend increase is at 58 years, a streak surpassed by just 17 other domestic companies.
This food stock's dividend yield is also part of the "buy now" case. At the current share price, the payout yields 2.6%, which isn't so high as to imply Sysco is a yield trap (it's not). Still, that yield is all the more meaningful at a time when the yield on the S&P 500 is barely above 1% and flirting with its all-time low.
Extract — continue reading at the source.
