Dividend stocks I bought recently? Is no longer a secret to you. It was the shares in it Munich Re (WKN: 843002) and of WP Carey (WKN: A1J5SB). By the way: Two names that I’ve had in my portfolio for a while and where I just upped the ante.
Why did it hit these two dividend stocks? Again, we can sum it up with one statement: It’s a bit of a buy-the-dip with a value focus and solid return potential. Maybe let’s take a closer look.
Munich Re: A dividend stock that I bought last time!
Yes, Munich Re is the last dividend stock I bought. This is due, among other things, to the diving. With a yield of about 4.4%, I grabbed it again. But I also see the potential to grab it again if the valuation falls.
Ultimately, Munich Re shares are a solid value proposition for me. Not that a solid profit beckons every year. Due to individual natural disasters or more difficult years, things can sometimes be mixed. However, the trend is correct for me. The management of the DAX reinsurance company talks about pricing in the reinsurance segment, an insufficient insurance offer. As well as moderate growth until 2024 and an expected profit of EUR 3.3 billion in the financial year 2022 according to the current forecast.
With a price/earnings ratio of 11.8 currently, I am convinced that even solid earnings returns are possible over the long term. The dividend stock is therefore not only convincing with a historically strong dividend since 1969, but also with a solid value profile. The option to use share buybacks rounds off the profile for me.
WP Carey: Are we at the beginning of pricing power?
I also bought the dividend stock WP Carey. The dip is also a reason here. After all, the share certificates have recently fallen from 87 euros in August to below 70 euros. Here, too, the trigger may be the rising interest rates in the US, which are less flattering as a peer.
However, WP Carey has something definite. The property investment trust has contractually guaranteed pricing in times of inflation through correspondingly rising rents. At least in about 59% of cases. If the vacancy rate does not increase, I see a solid promise of value here too, with a price-FFO ratio now at 13 and a yield of over 6%. It’s also a pretty solid starting position for me.
WP Carey should therefore be able to offer a solid counterweight to inflation in the longer term, even though the valuation has now fallen more significantly again. To my taste, this quality REIT’s valuation metrics have returned to a more normal level that may also provide a value proposition.
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Vincent owns shares in Munich Re and WP Carey. The Motley Fool recommends WP Carey.