With 2019 wrapping up, it’s time to look at the Dogs of the Dow again.
With this strategy, investors buy 10 of the highest yielding stocks on the Dow that fell out of favor in the year prior. They hold for the year, collect dividends along the way, cash out by year end, and repeat the strategy in the New Year.
For 2020, one of our favorite stocks to watch is Pfizer (PFE).
It appears the worst has been priced into the stock. With a strong drug portfolio, and continued investments in acquisitions and partnerships investors are waking back up to the opportunity in undervalued shares.
Cantor Fitzgerald’s Louise Chen argues that revenue gains, “operating leverage, pipeline advancements, return of capital to shareholders, and M&A are all underappreciated.”
She has an overweight rating on PFE stock with a price target of $54.
PFE just raised its dividend from 36 to 38 cents a share, payable March 6, 2020 to shareholders of record on January 31, 2020. We’d like to see a near-term bearish gap refill around $41.
This is just one of the opportunities we find quite often inside Extreme Option Profits.