PepsiCo (NYSE:PEP) Tops List of Most Lucrative Stocks for the Month Of December

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By Martin Foley on December 6, 2014 Consumer Staples

As we reach the end of the year, the holiday season is bound to have its annual impact on the stock market. It is a great time for investors of a buy-hold nature, those who hold on to stocks for a long period of time to benefit from dividends, to invest in shares which will give out the maximum amount of dividends in the shortest amount of time. For such investors, lucrative stocks are great investments, because dividends generated from them can later be reinvested into stocks for further growth.

Three stocks have the eye of analysts in this regard, namely PepsiCo (NYSE:PEP), Domino’s Pizza (NYSE:DPZ), and National Oilwell Varco (NYSE:NOV). Two of these belong to the fast food industry, and it is perfectly understandable why. In the holiday season, where almost everyone in the US takes a break, fast food is the most demanded. Hence, both Domino’s Pizza (NYSE:DPZ) and PepsiCo (NYSE:PEP) are going to have a skyrocketing business this month, generating profits and, in turn, dividends for investors.

But why these particular businesses? Clearly there are many competitive pizza brands in the US, such as Pizza Hut and Papa Johns, and many competitive soft drink brands, such as Coca-Cola.

PepsiCo (NYSE:PEP) is perhaps the most lucrative stock to hold in the month of December, and credit for its glory goes ultimately to the company’s policies in this regard. PepsiCo (NYSE:PEP) has increased its dividend payout every year for the past 42 years. By the end of this year, it is being estimated that the Coca-Cola competitor will be disseminating over $8.7 billion in shareholder dividends to all stockholders, either in form of dividends or buying back of shares. Dividend per share currently stands at $2.62 annually, which is a value increased by 15% over last year’s figure.

However, PepsiCo (NYSE:PEP) is not the only fast food brand proving lucrative for shareholders. In the case of Domino’s Pizza (NYSE:DPZ), analysts are positive shares for the company will draw in positive results due to the excellent performance by Domino’s Pizza (NYSE:DPZ) in the US. Recent figures show Domino’s Pizza (NYSE:DPZ) has increased its sales by 17%, which is a better figure than its competitors in the same industry, namely Pizza Hut (2%) and Papa Johns (7%). Market share in pizza deliveries has also increased for dominos, going up from 19% five years ago to almost 24% in the year prior to the current. With increase in market share comes increase in profits, and increase in profits naturally results in dividend payout.

Apart from the fast food industry, a company in the oil and gas sector needs the utmost attention of investors all over the country. This company is National Oilwell Varco (NYSE:NOV). The company is famous, because it is an oil company giving out a very lucrative dividend, at 2.7%, a quality unbecoming of a company of its nature. Oil prices are bound to increase, considering the recent oil turbulence in the east. However, NOV, with its $14.3 billion worth of backlog, and 10 times more free cash flow than it needs, provides ample security to investors, as far as their investments are concerned, and ensures a dividend payout for years to come.