With the stock market's recent volatility, it's a good idea to build a shortlist of dividend-paying stocks to buy in the event of more sell-offs. In this context it makes sense to focus on companies with well-covered dividends and good growth prospects. Three such stocks are aerospace giant Raytheon Technologies (NYSE: RTX) and industrial conglomerates 3M (NYSE: MMM) and Emerson Electric (NYSE: EMR) . Here's why.
The commercial aviation market might not be the first place investors choose to look for reliable and growing dividends right now. However, I think that view might be a bit short-sighted when it comes to Raytheon. In reality, the company is generating the majority of its revenue from its defense-focused businesses right now.
Raytheon Missiles & Defense and Raytheon Intelligence & Space support the company with earnings and cash flow while the commercial aerospace businesses (Collins Aerospace and Pratt & Whitney) embark on a multi-year recovery. As such, management expects to generate free cash flow (FCF) of $4.5 billion in 2021, a figure that will easily cover the dividend payout of some $3 billion.
For further details see:
3 Top Dividend Stocks to Buy During the Sell-Off