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Stocks  | September 13, 2019

The longest bull market in history keeps charging. Stocks are near record highs, which sounds good, but it does create a problem for income investors. Specifically, where can they find dividend stocks poised for outperformance that still sport decent yields?

The idea, after all, is to buy stocks when they're low, then sell high. And they don't seem too low when they're only a couple of percentage points below record levels. Stocks' lofty prices have crushed their yields, too. The trailing 12-month dividend yield on the S&P 500 stands at a paltry 1.9%.

High-quality dividend stocks with better-than-average yields do exist, however. We're here to help you find them.

We scoured the S&P 500 for dividend stocks with yields of at least 3%. From that pool, we focused on stocks with an average broker recommendation of Buy or better. S&P Global Market Intelligence surveys analysts' stock ratings and scores them on a five-point scale, where 1.0 equals Strong Buy and 5.0 means Strong Sell. Any score of 2.0 or lower means that analysts, on average, rate the stock a Buy. The closer the score gets to 1.0, the stronger the Buy call.

Lastly, we dug into research and analysts' estimates on the top-scoring names. That led us to these 25 great blue-chip dividend stocks that have the highest analyst ratings.


Market value: $18.2 billion

Dividend yield: 4.1%

Analysts' average rating: 2.0

With more than 1,100 branches across 15 states and about $130 billion in assets, Cleveland-based KeyCorp (KEY, $18.12) is one of the largest regional banks in the nation. A hefty dividend yield north of 4% and solid growth prospects have analysts convinced that solid returns still lie ahead.

"KEY is not immune to the challenging rate environment, but the company has been more aggressive than many in protecting its position," note analysts at Sandler O'Neill & Partners, who rate shares at Buy.

Analysts forecast the bank to generate average annual earnings growth of 7.8% over the next three to five years, according to data from S&P Global Market Intelligence. Add in a yield of more than 4%, making KEY one of the higher-yielding dividend stocks in the financial sector, and its total-return potential is sweet enough to warrant an average analyst recommendation of Buy.

One note: You might've heard this banking stock called out in July after it disclosed fraudulent activity involving a business customer that could cost KeyCorp up to $90 million. However, Baird analyst David George told CNBC the situation is "manageable." He has an Outperform rating (equivalent of Buy) on the stock, and says, "While we acknowledge that this isn't a pretty headline, we believe any weakness beyond 1.5%-2% is an opportunity to add to positions."

Archer Daniels Midland

Market value: $22.4 billion

Dividend yield: 3.5%

Analysts' average rating: 2.0

Archer Daniels Midland (ADM, $40.29) is a global food processor that also transports and stores agricultural products and even trades commodities. And this ag giant has earned a consensus Buy rating from Wall Street pros thanks to a host of operational and industry-wide catalysts.

"Archer-Daniels-Midland remains a well-positioned industry leader in grain and oilseed processing," say Stifel analysts, who rate shares at Buy. Easy year-over-year weather comparisons and cost-saving efforts also help make ADM attractive at current levels.

The African Swine Fever, which has forced pork producers in China and Southeast Asia to dramatically cull their herds, should provide a long-term tailwind for ADM, Stifel adds.

Analysts expect Archer Daniels Midland to grow its profits by roughly 6% annually over the next three to five years, according to S&P Global Market Intelligence. Their average target price of $47.64 implies about 18% upside over the next 12 months.

Bristol-Myers Squibb

Market value: $79.4 billion

Dividend yield: 3.4%

Analysts' average rating: 2.0

Bristol-Myers Squibb (BMY, $48.56) fits an income investing mold. Big Pharma is known for its glut of (typically generous) dividend stocks. Think Pfizer (PFE), GlaxoSmithKline (GSK) and AstraZeneca (AZN).

Analysts are largely optimistic about Bristol-Myers as it works to close its $74 billion merger with fellow pharmaceutical giant Celgene (CELG). The path to approval seems clearer now that Celgene has sold psoriasis drug Otezla to Amgen (AMGN) - a Federal Trade Commission requirement for the deal to go forward.

Bulls also point to strength in Celgene's drug pipeline as a key reason to buy this cheap stock.

This strategy has served BMY well since Bristol-Myers merged with Squibb three decades ago. A long track record of successful acquisitions has kept the pharma company's pipeline primed with big-name drugs over the years. Among the better-known names today are Coumadin, a blood thinner, and Glucophage, for Type 2 diabetes.

"We continue to believe the near-term growth profile and current valuation are attractive," say analysts at William Blair, who rate shares at Outperform.

Past results aren't indicative of future returns - that's perhaps for the best, given that BMY is so inexpensive because of three years of underperformance. But it is interesting to note that Bristol-Myers is one of the best stocks of all time.

General Motors

Market value: $56.5 billion

Dividend yield: 3.8%

Analysts' average rating: 1.95

General Motors (GM, $39.58) looks like a buy on valuation.

The world's fourth-largest auto manufacturer by production trades at a mere 5.8 times expected earnings in 2020. Which means you're buying the nearly 4% yield on this dividend stock at dirt-cheap prices. At the same time, analysts' forecast average annual earnings growth of more than 15% over the next three to five years, according to S&P Global Market Intelligence.

Citigroup analysts rate shares at Buy in part because pickup trucks, which account for the majority of GM's earnings per share, have undergone "years of structural demand explosion."

Evercore ISI analysts echoed Citi's optimism on pickups in August when they reiterated their Outperform rating on General Motors. They also say they favor GM over rival Ford (F).

Here's another fact that should instill confidence in GM investors: Berkshire Hathaway (BRK.B) Chairman and CEO Warren Buffett is a fan. Berkshire owns more than 72 million shares in GM, making it the automaker's fifth-largest shareholder.


Market value: $47.0 billion

Dividend yield: 3.0%

Analysts' average rating: 1.95

Plunging longer-term interest rates are making sectors flush with higher-yielding dividend stocks (such as utilities) more attractive by the day. So says Bank of America Merrill Lynch Data Analytics, a division meant to leverage big data to complement its research arm.

With the yield on the 10-year Treasury note wallowing well below 2%, Exelon (EXC, $48.35) looks pretty attractive to analysts and income investors alike. The nation's largest utility company by revenue offers a comparatively generous 3% yield on its dividend.

The company also might be a bargain right now. Morgan Stanley's Stephen Byrd upgraded the stock to Overweight (equivalent of Buy) from Equal Weight (equivalent of Hold) in late August, writing that the company's year-to-date underperformance has created an entry point in EXC. He also thinks the market isn't properly pricing in factors such as its merchant generation units.

Of the 21 analysts covering Exelon tracked by S&P Global Market Intelligence, eight rate the stock at Strong Buy, six say it's a Buy and seven call EXC a Hold.

Philip Morris International

Market value: $115.9 billion

Dividend yield: 6.1%

Analysts' average rating: 1.95

Philip Morris International (PM, $74.50) and Altria (MO) are discussing the possibility of an all-stock merger that would create a tobacco giant with a market value of roughly $200 billion. The deal would reunite the companies more than a decade after they split.

Citigroup analysts are betting that the merger won't get government approval - and say that's a reason to be bullish on PM stock. Citigroup, which rates shares at Buy, writes that the market doesn't like the idea of the tie-up at all.

"There is a decent chance that it won't go ahead, unless the companies can present compelling new reasons for the merger to shareholders," Citigroup writes. "If it does fail, we would expect PM shares to bounce nicely."

Like utilities and telecoms, tobacco firms are notoriously generous dividend stocks. PM has hiked its annual dividend every year since becoming a public company in 2008. That includes a Sept. 11 announcement that it would hike its quarterly dole by 2.6% to $1.17 per share.

Federal Realty Investment Trust

Market value: $10.2 billion

Dividend yield: 3.1%

Analysts' average rating: 1.95

Real estate investment trusts (REITs) such as Federal Realty Investment Trust (FRT, $136.18) are required to pay out at least 90% of their taxable earnings as dividends in exchange for certain tax benefits. Thus, REITs typically are a go-to source for income.

Few have been steadier than Federal Realty. The company, which owns retail and mixed-use real estate across 12 states, as well as the District of Columbia, has now hiked its payout every year for half a century. Even better, it has done so at an annual growth rate of more than 7%.

"Federal owns a portfolio of best-in-class retail centers," say Stifel analysts, who rate shares at Buy. "While the portfolio is not immune to the challenges facing the retail sector, we believe the high quality portfolio is well positioned to weather a challenging retail environment."

Of the 19 analysts covering FRT tracked by S&P Global Market Intelligence, eight call it a Strong Buy, four have it at Buy and seven call it a Hold.

Nielsen Holdings

Market value: $8.0 billion

Dividend yield: 6.3%

Analysts' average rating: 1.94

Nielsen Holdings (NLSN, $22.39), the ubiquitous media-ratings firm, is in fact far more than just TV numbers. It's a global measurement and data analytics firm that helps retailers and packaged-goods companies in more than 100 countries better understand their consumers.

Analysts are encouraged of late that Nielsen is showing improvement in parts of the business that have been under pressure.

The company's retail measurement business in China is picking up, note William Blair analysts, who rate shares at Outperform. "And Nielsen continues to see growth in national TV measurement and digital measurement," they write.

Nielsen admittedly has been a dog over the past three years, losing more than half its value over that time. But that has driven its yield up to 6.3%, which should draw more attention from investors seeking out high-yield dividend stocks.

Encouragingly, the analyst community as a whole expects some sort of rebound out of Nielsen. They estimate the company will generate average annual earnings growth of 12% for the next three to five years, according to S&P Global Market Intelligence. They also have an average price target of $27.50, implying upside of about 23% over the next year.

Gilead Sciences

Market value: $85.0 billion

Dividend yield: 3.8%

Analysts' average rating: 1.93

Biotechnology giant Gilead Sciences (GILD, $67.08) is a rarity in that it's one of the industry's few dividend stocks, and it offers a high yield of nearly 4% to boot.

The bad news: Gilead is lagging the broader market by a wide margin so far in 2019. The good news (at least for new money): Analysts say that makes GILD a bargain.

Oppenheimer analysts reiterated their Outperform rating in August, noting that Gilead reported strong quarterly earnings and has delivered a steady stream of good news. GILD in early August received a positive recommendation for its Descovy HIV treatment from a Food and Drug Administration advisory panel. The biotech also attained Chinese approval of its Biktarvy HIV treatment in August.

Analysts are betting that it's only a matter of time until the market wakes up to Gilead's encouraging results and slew of good news. Of the 27 analysts covering the stock, 13 call it a Strong Buy, four have it at Buy, nine say its a Hold and just one rates GILD at Sell, according to S&P Global Market Intelligence.

CVS Health

Market value: $82.7 billion

Dividend yield: 3.1%

Analysts' average rating: 1.93

Analysts think CVS Health's (CVS, $63.60) roles as a pharmacy chain, pharmacy benefits manager and health insurance company give it a unique profile in the health-care sector.

CVS's $69 billion merger with Aetna in 2018, which only recently received a federal green light concerning antitrust issues, is delivering faster-than-expected cost savings, say analysts at Cowen & Co., who rate the stock at Outperform.

Morgan Stanley analysts, who rate shares at Overweight, write that CVS Health's same-store sales - a key retail industry metric - are improving. The analysts add that CVS's opportunity to gain market share in Medicare Advantage by cross-selling is "underestimated by the market."

As a group, analysts expect upside of about 11%, given their average price target of $70.68. Long-term earnings growth is pegged at almost 5% over the next three to five years, according to S&P Global Market Intelligence.

Dividend investors should just note that while CVS has a strong dividend payment history, it ended its 14-year streak of payout hikes in 2018. The company kept the dividend level, instead choosing to divert cash toward paying off its debt, which ballooned when it assumed the $8 billion that Aetna owed.


Market value: $20.4 billion

Dividend yield: 5.0%

Analysts' average rating: 1.92

Weyerhaeuser (WY, $27.34) is among the largest private owners of timberlands in the world. It's also a REIT, which means it's a dividend machine.

Stephens Equity Research upgraded Weyerhaeuser to Overweight from Equal Weight in the second quarter, citing the stock's solid dividend and suitability as an income play. The analysts also see upside in the share price.

So does the broader analyst community. The pros' average target price of $29.35 gives WY stock modest implied upside of around 7% over the next 12 months or so.

The total-return potential is even better when you consider Weyerhaeuser's 5% yield, which is one of the most generous among REITs in the S&P 500. That dividend is growing like a weed, too. Since 2010, when WY converted to the REIT structure, the company's quarterly dividend has exploded by 580%, from 5 cents per share to 34 cents currently.


Market value: $231.3 billion

Dividend yield: 3.9%

Analysts' average rating: 1.92

Many dividend stocks in the energy sector sport bloated yields right now thanks to considerable underperformance over the past few years. That's the case for integrated energy giant Chevron (CVX, $121.85), which has inched ahead just 3% since the start of 2017, versus 34% gains for the broader market.

Still, Wall Street's brightest minds seem to think Chevron will change that. Of the 26 analysts covering the Dow Jones Industrial Average component, 10 call it a Strong Buy, eight say it's a Buy and eight rate CVX at Hold.

Chevron is particularly well-liked by Jefferies analysts, who have it on their "Franchise Picks List," comprised of the "highest conviction, buy-rated stocks from the Jefferies U.S. Research Team."

Jefferies writes that Chevron is the "most strategically advantaged in the super-major sector." The company is poised to deliver higher free cash flow (FCF, which is the cash left over once expenses, interest debt and other investments are accounted for) thanks to the completion of major capital projects, lower capital expenditures, and production growth from high-margin products.


Market value: $25.2 billion

Dividend yield: 3.3%

Analysts' average rating: 1.90

FirstEnergy (FE, $46.74), an electric utility with 6 million customers in the Midwest and Mid-Atlantic regions, took a promising step this year. The company hiked its quarterly payout by 5.6% to 38 cents per share, up from 36 cents in 2018.

Why highlight such a modest dividend hike? Because that dividend had been stuck at 36 cents per share since 2014 - the year FirstEnergy clipped its payout by more than a third amid declining power prices. In late 2018, FirstEnergy management claimed that the company would be returning to growth, and implied that higher dividends were a goal going forward.

Barclays, which rates shares at Buy, believes the Akron, Ohio-based company does indeed have room to grow. Nine analysts call FE a Strong Buy, four say it's a Buy, five have it at Hold and one rates it at Sell.

Utilities aren't known for rapid growth, but analysts expect FE to generate a respectable 5.5% in average annual earnings growth over the next three to five years. They don't see much stock-price upside, as a collective target of $47.44 implies just 1% in future gains. But the 3.3% dividend yield makes the total return potential more palatable.

Citizens Financial Group

Market value: $16.2 billion

Dividend yield: 4.0%

Analysts' average rating: 1.86

Solid long-term earnings growth and a generous dividend yield have analysts plenty bullish on Citizens Financial Group (CFG, $36.28), the nation's 13th-largest bank by assets.

The regional financial company best known for Citizens Bank branches throughout New England, the Mid-Atlantic and Midwest is forecast to generate average annual earnings growth of almost 9% over the next five years. The top line is expected to be a bit more modest, but there's still upside, with analysts projecting 5.7% revenue growth this year, then another 2.5% in 2020.

CFG is among the sneakier dividend stocks out there, too. You don't hear much about it because it's a regional bank (albeit a large one). But its 4% yield is more than double the S&P 500's rate, and its payout has exploded by 260% over the past half-decade to its current 36 cents per share.

Analysts are modeling roughly 14% upside over the next 12 months or so, based on an average price target of $41.18, according to S&P Global Market Intelligence.


Market value: $51.8 billion

Dividend yield: 5.3%

Analysts' average rating: 1.82

Schlumberger (SLB, $37.46) - another high-yield dividend stock from the energy sector - is set to benefit from improving international market conditions, say analysts at Stifel, who rates shares at Buy.

The oilfield services giant is enjoying strong international revenue growth, Stifel notes. In the most recent quarter, the firm posted an 8.5% quarter-over-quarter increase in international sales. Year-over-year, revenue improved by 7.9%. And looking forward, SLB expects international revenue to rise 7% to 8% in 2019.

Strong operating free cash flow and anticipated divestitures led management to indicated that the current dividend will be maintained, Stifel says.

Analysts as a whole lean bullish on the stock. Of those tracked by S&P Global Market Intelligence, 17 call SLB a Strong Buy, six say Buy and 11 call it a Hold.

Morgan Stanley

Market value: $72.0 billion

Dividend yield: 3.2%

Analysts' average rating: 1.82

Morgan Stanley (MS, $43.58), Wall Street's second-largest investment bank after Goldman Sachs (GS), is set to benefit from lower interest rates, say analysts at Citigroup.

Citi, which rates MS at Buy, believes Federal Reserve rate cuts will "spur capital markets activity." More trading means more business for brokers such as Morgan Stanley.

"We see Morgan Stanley net income growth of 2% to 3% over the next two years by continuing to gain market share in both its institutional and retail franchises," Citi adds.

Longer-term, analysts see Morgan Stanley delivering average annual earnings growth of almost 10%. Their average target price of $52.08 gives MS implied upside of about 20%.


Market value: $117.2 billion

Dividend yield: 3.6%

Analysts' average rating: 1.79

Semiconductor manufacturer Broadcom's (AVGO, $294.44) recent payout growth has sizzled compared to most other dividend stocks. Since 2014, the payout has exploded by more than 800%, from 29 cents per share quarterly to its current $2.65.

And analysts are bullish about the stock ahead of its third-quarter earnings report, which is slated for release on Sept. 12.

Loop Capital, which rates the semiconductor manufacturer at Buy, expects AVGO to strike a cautious tone, partly because of macro-economic uncertainty. The U.S.-China trade war and slower global growth has cast a pall over chipmakers.

That said, Loop expects acceleration in the fourth quarter as mobile customers such as Samsung and Apple (AAPL) go through their usual seasonal ramp up in production.

Eighteen analysts rate AVGO at Strong Buy, four call it a Buy, and 11 say Hold, according to S&P Global Market Intelligence. Broadcom is forecast to deliver long-term earnings growth of almost 16% a year. That should help support Broadcom's ballooning dividend - albeit, probably not at the same 56% annualized clip it has been averaging over the past five years.


Market value: $66.5 billion

Dividend yield: 3.1%

Analysts' average rating: 1.77

Analysts see outsize upside in shares of BlackRock (BLK, $428.34) over the next 12 months or so. Wall Street's average price target stands at $517.63. That gives shares in the world's largest asset manager - responsible for BlackRock mutual and closed-end funds, as well as iShares exchange-traded funds - implied upside of more than 20%.

Meanwhile, earnings are forecast to grow at an average annual pace of almost 12%, and the stock trades at a forward-looking price-to-earnings ratio of roughly 15. It's clear Wall Street thinks BLK is a bargain at current levels; seven analysts rate BLK at Strong Buy, seven call it a Buy and three say it's a Hold.

In May, BlackRock closed on its $1.3 billion buyout of French tech company eFront. The firm provides alternative investment management software and solutions to customers in 48 countries, giving BlackRock more international clout.

BLK has hiked its dividend every year without interruption for a decade, including a 5.4% improvement announced back in January.

Valero Energy

Market value: $33.8 billion

Dividend yield: 4.4%

Analysts' average rating: 1.76

Shares in Valero Energy (VLO, $81.68) have lagged the S&P 500 in 2019, but analysts think they're poised for a rebound.

Oil refiners such as Valero have been under pressure on a number of fronts, but none is more salient than the U.S. trade war with China. Goldman Sachs says it's time to buy into higher-quality companies at a discount - and Valero fits the bill. GS analysts say the market is underappreciating the value in Valero's renewable diesel segment. They also point to increased flows of crude oil to the U.S. Gulf Coast, which is where much of Valero's refining capacity is situated.

And don't discount Valero's 4%-plus yield, which is considerably higher than what most blue-chip dividend stocks pay out.

Eight analysts call VLO a Strong Buy, while 10 have it at Buy. A mere three analysts call the stock a Hold. And the pros expect Valero to generate roughly 10% in average annual profit growth over the next three to five years.

Regency Centers

Market value: $11.4 billion

Dividend yield: 3.4%

Analysts' average rating: 1.76

Regency Centers (REG, $68.22) is another steady income play from the real estate space.

This REIT owns, operates and develops shopping centers located in affluent areas. Its 400-plus properties span from coast to coast, but are heavily clustered around places such as New York City, San Francisco, Chicago, Denver and the District of Columbia. Its tenants include grocers such as Publix or Safeway, restaurants, service providers and retailers.

Regency has upped its dividend for six consecutive years. Over that span the quarterly payout has increased 26%, from 46.25 cents per share to 58.5 cents currently.

Of the 21 analysts covering the stock tracked by S&P Global Market Intelligence, 10 say REG is a Strong Buy, six have it at Buy and five rate it at Hold. In mid-August, Scotiabank analysts joined the bull camp, upgrading Regency Centers to Outperform from Sector Perform (Hold).


Market value: $155.8 billion

Dividend yield: 3.0%

Analysts' average rating: 1.74

Analysts expect good things from Citigroup (C, $68.98), the nation's fourth-largest bank by assets, and the largest of the financial-sector dividend stocks on this list.

Sandler O'Neill & Partners, which rates C shares at Buy, notes that the money center bank is racking up one good quarter after another. Revenues are up, costs are down and credit metrics are solid, analysts say.

12 analysts rate Citigroup at Strong Buy and 11 say it's a Buy. Three analysts have shares at Hold and one calls it a Sell. All told, their collective price target of $80.08 implies about 16% upside.

S&P Global Market Intelligence data says Citigroup is forecast to deliver average annual earnings growth of almost 14% over the next three to five years.

Baker Hughes, a GE Company

Market value: $25.0 billion

Dividend yield: 3.0%

Analysts' average rating: 1.73

Baker Hughes, a GE Company (BHGE, $24.11) has a number of catalysts that should boost shares in the not-too-distant future, analysts say.

Stifel, which rates BHGE at Buy, says the oilfield services company should capture orders for liquid natural gas equipment over the next few quarters. The firm also is poised for margin expansion in both oilfield services and oilfield equipment amid rising international oilfield activity.

Of the 30 analysts covering BGHE, 14 have it at Strong Buy, 10 say it's a Buy and six call it a Hold. Analysts expect outsized profit growth over the next three to five years. BGHE has a long-term earnings-growth forecast of 36%. Net income is forecast to more than double to $852.2 million in 2020 from $419 million in 2019.

Meanwhile, shares trade for less than 20 times projected earnings over the next 12 months. That suggests the stock is a bargain at current levels.

General Electric (GE) recently announced it was selling roughly $3 billion worth of BGHE stock, which means it will lose majority control. For Baker Hughes, that's mostly noise; GE is selling part of its stake to help pay off debt.

Williams Cos.

Market value: $30.1 billion

Dividend yield: 6.1%

Analysts' average rating: 1.74

Energy-sector dividend stocks are a running theme on this list that continues with Williams Cos. (WMB, $24.85), which operates pipelines for natural gas, crude oil, petrochemicals and feedstock.

"With a diversified gathering footprint and the largest U.S. long-haul natural gas pipeline, Williams' footprint should continue to benefit from higher production and demand across the U.S. and remain insulated from commodity price swings," say Stifel analysts, who rate shares at Buy.

Of the 23 analysts covering WMB tracked by S&P Global Market Intelligence, 11 rate it at Strong Buy, seven say Buy and five call it a Hold.

One of those Hold opinions comes from Argus analyst Bill Selesky highlights the difficulty with holding energy stocks, regardless of their yield. He said in August that natural gas prices had already declined well below his target and expected more downward pressure on the commodity. He did, however, laud Williams' high yield and improved balance sheet.


Market value: $17.5 billion

Dividend yield: 3.6%

Analysts' average rating: 1.61

If analysts like Schlumberger and Baker Hughes, they're almost gushing over Halliburton (HAL, $20.03). Of the 33 analysts covering the oilfield services company, 18 call HAL a Strong Buy and 10 rate it at Buy, while just five say Hold.

Analysts aren't completely over the moon, however. The stock suffered a run of price-target downgrades in July - including Credit Suisse's Jacob Lundberg, citing a weaker North American outlook - because of a slowdown in U.S. shale oil production amid tepid prices for crude. But most analysts held still on their positions, satisfied with Halliburton's decision to cut 8% of its North American workforce.

And even with the PT cuts factored in, analysts still see mammoth upside in Halliburton shares. The average price target on HAL is $31, which implies almost 55% in upside over the next year. The earnings forecast is positive but not as jubilant: The pros believe profits will grow at a roughly 10% average annual clip over the next three to five years.

Marathon Petroleum

Market value: $35.9 billion

Dividend yield: 3.9%

Analysts' average rating: 1.55

Tops among S&P 500 dividend stocks is Marathon Petroleum (MPC, $54.48). The company, which refines and transports oil and gas, as well as markets it sports a generous dividend yield and has the potential for serious upside in the year ahead.

Jefferies resumed coverage of Marathon in early September. Analysts rate shares at Buy, calling the company a "diversified, vertically-integrated cash machine with premier assets." The solid balance sheet gives MPC "clear channels to funnel excess cash to shareholders," Jefferies adds.

Raymond James' Justin Jenkins (Strong Buy) has lowered his price target on Marathon more than once this year amid difficulties for refiners. However, in his April PT downgrade, he wrote that "we have long been fans of management's strategy of improving refining returns, growing the higher-multiple retail segment, and unlocking value" at spinoff MPLX LP (MPLX). An encouraging sign? In August, Jenkins lifted his price target on MPC from $72 per share to $75.

That's actually slightly lower than analysts' average target price of $76.45, which implies roughly 40% upside over the next 12 months. MPC is teeming with bulls, too. Of the 20 analysts covering Marathon, only a pair say to Hold - the rest are Strong Buys (11) and Buys (seven).

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