Cheap Dividend Stocks to Buy Under $20
The U.S. economy has started to cool in 2024, and while inflation has cooled considerably, it’s still higher than the Federal Reserve’s 2% target rate. One way for investors to offset the negative impact of inflation is to generate regular income via dividend stocks. In the past 90 years, dividends have accounted for about 40% of the total stock market return. The combination of a rising stock price and a regular dividend can work wonders for long-term returns.
Fortunately, there are plenty of dividend stocks out there that don’t cost an arm and a leg. Here are 10 of the best dividend stocks to buy for less than $20, according to CFRA:
| STOCK | IMPLIED UPSIDE OVER JULY 15 CLOSE | FORWARD DIVIDEND YIELD |
| Energy Transfer LP (ticker: ET) | 9.8% | 7.8% |
| Vale SA (VALE) | 21.6% | 15.2% |
| Kenvue Inc. (KVUE) | 27.0% | 4.4% |
| Barrick Gold Corp. (GOLD) | 3.5% | 2.2% |
| Orange SA (ORAN) | 19.6% | 7.2% |
| Telefonica SA (TEF) | 3.4% | 7.5% |
| Nokia Corp. (NOK) | 14.8% | 3.6% |
| Host Hotels & Resorts Inc. (HST) | 20.2% | 4.4% |
| Aegon Ltd. (AEG) | 18.7% | 5.5% |
| First Horizon Corp. (FHN) | 0.5% | 3.6% |
Energy Transfer LP (ET)
Energy Transfer is a midstream U.S. oil and gas infrastructure provider, focusing on pipelines, storage and terminals. The company also has an alternative energy group developing renewable energy technology. In addition to its attractive 7.8% dividend yield, Energy Transfer shares are up an impressive 23.9% through July 15 this year, including dividends. Analyst Stewart Glickman says Energy Transfer has an attractive positioning in the U.S. Gulf Coast region, particularly in Mont Belvieu, Texas. Glickman says that positioning will enable the company to take advantage of significant natural gas liquids export demand in 2024. CFRA has a “buy” rating and $18 price target for ET stock, which closed at $16.39 on July 15.
Vale SA (VALE)
Vale is a Brazilian miner and is one of the world’s largest iron ore and nickel producers. Vale shares have struggled in 2024 and are down 24.2% through July 15. The silver lining for investors is that the pullback has pushed Vale’s dividend yield way up to 15.2%. Analyst Matthew Miller says Vale will continue to face liability concerns and uncertainty related to the 2019 Brumadinho dam disaster in Brazil. However, he says Vale has taken meaningful actions to reduce risk of further incidents. CFRA has a “buy” rating and $14 price target for VALE stock, which closed at $11.51 on July 15.
Kenvue Inc. (KVUE)
Kenvue is the largest pure-play consumer health stock and is the owner of popular brands such as Band-Aid, Tylenol, Neutrogena, Aveeno, Johnson’s, Listerine and Nicorette. Kenvue was spun-off from parent company Johnson & Johnson (JNJ) and went public in May 2023. Analyst Ana Garcia says Kenvue has tapped into attractive markets and is uniquely positioned to capitalize on emerging trends and dynamic consumer preferences. Garcia says Kenvue is attempting to stimulate its underperforming Skin Health & Beauty and Essential Health segments by implementing new strategies. CFRA has a “buy” rating and $23 price target for KVUE stock, which closed at $18.11 on July 15.
Barrick Gold Corp. (GOLD)
Barrick Gold is one of the world’s largest gold mining companies. Miller says he is bullish on gold and copper prices, and higher prices will support Barrick’s earnings growth. In addition, he says the stock is trading at an attractive valuation discount relative to peers. Miller says Barrick’s quality portfolio of assets will create significant value for investors. The company is positioned to focus on its highest quality mines, which will increase free cash flow per share. Finally, Miller says the company’s Nevada joint venture will boost earnings. CFRA has a “buy” rating and $19 price target for GOLD stock, which closed at $18.36 on July 15.
Orange SA (ORAN)
Orange is a diversified French telecommunications company. Analyst Adrian Ng says telecommunications companies are facing a difficult regulatory and operational environment across Europe, but those headwinds have already been priced into Orange shares at their current levels. Ng says Orange has an opportunity to raise cash to invest in its business if it can successfully monetize its valuable tower assets. Cost cutting efforts will also help support margins. Ng says Orange management has committed to maintaining its dividend, which currently yields 7.2%. CFRA has a “buy” rating and $13 price target for ORAN stock, which closed at $10.87 on July 15.
Telefonica SA (TEF)
Spain’s Telefonica is another attractive international telecom dividend stock trading under $20. Ng says Telefonica has made several major restructuring moves to shore up its core business and reduce its debt load. The company has acquired E-Plus in Germany and GVT in Brazil. It has also combined its U.K. telecom assets in a joint venture deal with Liberty Global PLC (LBTYA, LBTYB) and exited the Central America market. Ng says Telefonica exceeded expectations in a difficult environment in 2023, and it has positive momentum in 2024. CFRA has a “buy” rating and $4.50 price target for TEF stock, which closed at $4.35 on July 15.
Nokia Corp. (NOK)
Nokia is a telecom equipment and digital map data vendor that also licenses intellectual property to third parties. Analyst Keith Snyder says the global 5G network investment cycle is gaining momentum, particularly in North America and China. Snyder says the 5G upgrade cycle will be larger and longer-lasting than previous cycles, supporting Nokia’s demand. Nokia is optimistic it can regain lost market share in its North America Mobile Networks business, and Snyder says the company’s impressive execution and improving earnings visibility make it an excellent investment. CFRA has a “buy” rating and $4.50 price target for NOK stock, which closed at $3.92 on July 15.
Host Hotels & Resorts Inc. (HST)
Host Hotels & Resorts is a hotel and resort real estate investment trust, or REIT, that owns luxury hotels in North and South America. Analyst Michael Elliott says lodging demand will likely remain slightly below 2019 pre-pandemic levels in 2024, but he says business and group demand continues to improve. Leisure demand has pulled back from post-pandemic highs, but Elliott says it remains strong thanks to a healthy U.S. consumer. Looking ahead, he says Host is the only lodging REIT with an investment-grade balance sheet, reducing risk for investors. CFRA has a “buy” rating and $22 price target for HST stock, which closed at $18.31 on July 15.
Aegon Ltd. (AEG)
Aegon is a Dutch insurance company that offers insurance, savings, pension, and investment products and services around the world. Analyst Jeff Lye says Aegon has set achievable financial targets in 2024 and the company has a long track record of strong execution. Lye is bullish on the company’s strategy of extracting capital from its non-core Financial Assets business and focusing on strategic assets that reduce capital ratio volatility and generate an attractive return on capital. He says Aegon’s capital return program will continue to reward investors. CFRA has a “buy” rating and $7.50 price target for AEG stock, which closed at $6.32 on July 15.
First Horizon Corp. (FHN)
First Horizon is a U.S. regional bank, providing retail and commercial banking, asset management services, and other banking services in Tennessee, Florida and the Carolinas. U.S. regional bank stocks have experienced extreme volatility in the past year as declining bond values shook investor confidence and led to concerns about liquidity and withdrawals. First Horizon shares were hit hard in 2023, but analyst Alexander Yokum says First Horizon’s net interest margin is improving, and the company is one of the best-capitalized regional banks. CFRA has a “buy” rating and $17 price target for FHN stock, which closed at $16.91 on July 15.
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