By: Dividend Sensei
The short “taper tantrum 2.0” lasted a few weeks and saw stocks fall just 5.2%. We’re now back to record highs and a 26% historically overvalued market.
Fortunately, it will always be a market of stocks and not a stock market. At any given time, 40% of blue-chips are trading at fair value or better.
Today these companies represent three of the most undervalued high-yield dividend aristocrats.
They are priced for little to no growth, while analysts, rating agencies, and the bond market expect modest growth that could deliver Buffett-like returns from aristocrat bargains hiding in plain sight.
Each of these high-yield aristocrats offers a 3.7% to 7.5% very safe yield, and 16% to 18% CAGR 5-year consensus return potential.
That means the potential to more than double in the next five years and beat the S&P 500 by 5X.