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Analysts say that these three dividend shares are top choices for 2021

The market pendulum has recently swung from one extreme to another, which has made it difficult for investors to track. Ups and downs in the rapidly changing situation are exactly the opposite of what investors want to see. What investors would naturally like to see is returns. And regardless of whether the markets are up or down, it is a profitable investment strategy to follow the analysts’ “top choice”. Wall Street professionals can do the footwork, and their published reports can inform our market decisions and serve as a set of investor guidelines. We have opened the TipRanks database to take a closer look at three of these ‘top picks’. These are all names that pay dividends, a sure way to ensure a stable income no matter in which direction the market goes. If that’s not enough, all three received enough support from Wall Street analysts to get a “Strong Buy” consensus assessment. . Ellington Financial (EFC) We start in the financial sector, where Ellington Financial lives in the niche of real estate investment. Ellington invests its energy in a wide range of real estate activities, including commercial and mortgage lending, equity investments and securities. The company uses a range of risk management tools to mitigate the natural risks of securities-based securities and ensure profit for investors. Ellington’s most recent quarterly report, for 4Q20, showed the third consecutive increase in EPS, which increased 38% from the third quarter to $ 1.44. For the full year 2020, the EPS was 39 cents per ordinary share, a decrease of 15% compared to the previous year, on net income of $ 17.2 million. Like most REITs, Ellington pays a regular dividend – and Ellington has been able to maintain regular dividends throughout the corona crisis year, despite a cut in the height of the panic. The most recent declaration, made in early February for a payout on March 25, was for 10 cents per ordinary share, the same as the last three payments. The company pays the dividend every month and has increased it gradually after last year’s cut. The current payment gives a return of 7.5%. In its coverage of Ellington, Maxim analyst Michael Diana writes, “EFC’s capital is allocated 85% to credit assets, and almost everyone has done well. Particularly noteworthy are non-QM loans and reverse mortgages. Not only has the demand for these credit classes been high, but EFC also has significant holdings in the companies that have these loans; thus, EFC wins twice. As smaller mortgage companies went bankrupt during the pandemic, competition has decreased, which has led to favorable pricing. “In the end, Diana simply says, ‘EFC remains our top choice under our mortgage REIT (mREIT) coverage.’ For this purpose, Diana EFC is considering a purchase and his $ 19 price target proposes an upward year of ~ 20%. (To see Diana’s track record, click here) There is agreement on Wall Street that EFC is a quality investment, and analysts’ consensus assessment shows that it is a unanimously strong buy based on 4 recent reviews. The stock is priced at $ 15.77, and their average target is $ 17.25, representing a 9% upward potential from current levels. (See EFC stock analysis on TipRanks) OneMain Holdings (OMF) Holds on to the financial sector, but when it comes to services rather than REIT, we look at OneMain Holdings. This company’s subsidiary offers a range of financial services, including consumer finance and insurance, to a customer base that is usually neglected by the regular financial industry: private customers who for some reason do not have access to the regular banking and credit financing industry. The importance of this market segment should not be ignored, and OneMain demonstrated this during the 2020 financial year by bringing in $ 4.4 billion in total revenue. By the end of the 2020 calendar year, OneMain reported $ 1.23 billion in peak revenue for the fourth quarter and $ 2.67 in earnings per share. While revenues were steady, EPS increased 43% from the previous quarter – and 39% compared to the previous year. Just like EFC, OneMain pays a dividend – but unlike REIT, OneMain uses a unique additional dividend policy. Every second and fourth quarter, the company pays its minimum dividend per ordinary share – but during the first and third quarters, it adds a one-time supplement to the payment. The minimum payment is currently set at 45 cents per ordinary share. the last allotted common stock on February 25 was for $ 3.95. Analyst Michael Kaye from Wells Fargo is impressed by OneMain and does not hold back in his comments about the company: “We believe that OMF is one of the best stories in consumer finance and that it is surprisingly still under the radar of many financial investors. In our opinion, covered bonds are a unique return on excess capital and we expect the dividend to be paid at USD 8.30 in 2021, which corresponds to a return of 14.5%. We also view the new credit card initiative positively as it aims to drive increasing growth, add value to their franchise, leverage their guarantees, distribution and service. Covered bonds are still our top choice in our coverage. Kaye values ​​the OMF shares an overweight (ie buy) and his price target of $ 65 means an upward trend of 34% next year. (To see Kaye’s track record, click here) It’s not often that analysts all agree on a stock, so when it does, take note. OMF’s consumer rating for strong purchases is based on unanimous 10 purchases. The stock’s average price target of $ 63.60 proposes an upward 31% compared to the current stock price of $ 94. (See OMF share analysis on TipRanks) Devon Energy (DVN) For the latest “top choice” stock we are looking at here, we are switching to the energy industry. Devon Energy, with a market value of $ 15 billion, owns mineral rights – that is, the right to explore and drill – on 1.8 million acres in Texas and in adjacent areas of Oklahoma and New Mexico. This is one of North America’s most productive oil regions, and in recent years, production here has helped make the United States a net exporter of fossil fuels. Devon also controls production areas in Wyoming. That said, Devon has over 10,000 wells in active use and an estimated 752 million barrels of oil equivalent proven reserves. During the fourth quarter of 2020, Devon showed a series of strong measures. Production averaged 333,000 barrels of oil equivalent daily, encouraged by a 7% increase in crude oil production during the quarter. The business generated a cash flow of $ 773 million for the quarter, of which $ 263 million was free cash flow. In connection with the earnings report, Devon announced a regular dividend of 11 cents per share, together with an additional variable dividend of 19 cents per share. Both will be paid out on March 31. Scotiabank’s Paul Cheng reiterates his decision to make Devon a top choice and writes: “We still see significant fundamentals upwards despite YTD outperformance and the stock now trading at> 4 times its trough by 2020 … expect relevance, size, liquidity etc . will prevent the stock from revaluing higher. As the company continues to deliver attractive core results and implement its shareholder – friendly strategy in the coming months and years, we expect DVN to surpass when the market receives further appreciation of history and begins to reflect these fundamental factors in the stock price. . “Cheng’s Outperform (ie Buy) class is supported by a $ 30 price target that has a 12-month upward potential of 31%. (To see Cheng’s track record, click here) In total, there have been 19 rounds of shares of Devon Energy recently, and they break down 17 to 2 in favor of Buys versus Holds, making the analyst’s consensus rating a clear strong buy. DVN is selling at $ 22.83 per share, and the average price target of $ 24.89 suggests ~ 9% upwards from that level. (See DVN stock analysis on TipRanks) To find great ideas for dividend stocks at attractive valuations, visit TipRanks’ Best Stocks to Buy, a recently launched tool that unites all of TipRanks stock insights. Disclaimer: The views expressed in this article are solely those of analysts. The content is intended for informational purposes only. It is very important to do your own analysis before making any investments.