8 Undervalued Stocks That Just Increased Their Dividends

Plus: Why yields are so high for covered-call funds, portfolio moves to make now, what to watch for in the CPI. [Morningstar](?utm_source=eloqua&utm_medium=email&utm_campaign=newsletter_smartinvestor&utm_content=49585&elqTrackId=18a4049f788047588b5659354af00b9e&elq=188ddb069db3479da33410dad387f437&elqaid=49585&elqat=1&elqCampaignId=24740) [Smart Investor] Smart Investor [Tom Lauricella, chief markets editor]( Connect with Tom on [LinkedIn]( [Tom Lauricella] In this week's newsletter: - [8 Undervalued Stocks That Just Increased Their Dividends]( - [These Funds Fared the Worst In the Bond Market Selloff]( - [October CPI Report Forecast to Show Overall Inflation Moderating]( - [What to Do With Your Stock and Bond Investments Now]( - [Why Intermediate Bonds Offer a Cushion for Your Portfolio]( Somebody better keep an eye on the punch bowl! I’m referring, of course, to the famous speech (famous in economist circles, anyway) given way back in 1955 by Federal Reserve chair William McChesney Martin. He [described the Fed]( as a “chaperone who has ordered the punch bowl removed just when the party was really warming up.” Today investors have been wondering instead when the Fed is going to bring the punchbowl back to the party—if not by cutting rates, then at least by no longer raising them. Over the last two weeks, investors have been growing more certain that interest rate hikes are history, prompting a bond market bounce after a steep two-and-half-month selloff. While the bounce has reduced the damage, some bond funds are still threatening investors with an unprecedented third year in a row of losses. Which bond funds took a hit? How are the bond funds that are most likely in your 401(k) doing? [Katherine Lynch takes a look](. On this front, there’s a big test for the markets coming up this week: the October Consumer Price Index report. A hotter-than-expected inflation reading could set stock and bond markets back again, while good news could mean both markets are off to the races. Sarah Hansen has a preview of [what to watch for in the CPI report](. There’s been one important difference for bond investors this year versus last year: higher yields. As [Madeline Hume explains]( this means bond investors have more of a cushion in their portfolios against losing money when yields rise. That’s especially the case for intermediate bonds—and whether you realize it or not, those are probably a good chunk of your target-date fund portfolio. Of course, the question comes back to how to navigate these markets. Check out [this short video]( interview with Morningstar chief U.S. market strategist Dave Sekera about how he thinks investors should position stock and bond portfolios right now. Many investors seem to be deciding that now is a good time to load up on high-yielding covered-call funds. But do they really understand how these popular funds work? We took a look at [why their yields are so high](. And speaking of yields, our last piece is a screen for undervalued stocks that have just raised their dividends. We found [eight cheap stocks that met our criteria]( including one company that claims to have served “billions and billions.” That’s it for this week! As always, check out our [Markets page]( for our latest coverage and live stock market updates along with our [weekly calendar]( of key upcoming data and events. Did a friend forward this email? [Sign up here](. [8 Undervalued Stocks That Just Increased Their Dividends]( [8 Undervalued Stocks That Just Increased Their Dividends]( McDonald’s, Sirius XM, and Microchip Technology are among the stocks with higher payouts. Tom Lauricella [Read More]( Share: [facebook]( [twitter]( [linkedin]( ADVERTISEMENT [media]( [media] Markets and the Economy [Weekly Markets Planner: Economics Calendar, Company Earnings, Investor Relations Events]( [Weekly Markets Planner: Economics Calendar, Company Earnings, Investor Relations Events]( CPI and Housing Starts reports, earnings from Home Depot, Walmart, and Alibaba on deck. Tom Lauricella [Not All Total Returns Are Created Equal]( [Not All Total Returns Are Created Equal]( Return sequences can help performance as well as hinder it. John Rekenthaler [October CPI Report Forecast to Show Overall Inflation Moderating]( [October CPI Report Forecast to Show Overall Inflation Moderating]( Core inflation seen remaining sticky, but the Fed to hold rates steady in December. Sarah Hansen [Higher Bond Yields and Interest Rates Are Here to Stay]( [Higher Bond Yields and Interest Rates Are Here to Stay]( Also, the sales outlook for the blockbuster diabetes drug Mounjaro and the debate on whether unions are bad for investors. Ivanna Hampton, Sarah Hansen, Adam Fleck [Why Are Covered-Call Fund Yields So High?]( [Why Are Covered-Call Fund Yields So High?]( These are the factors influencing big payouts on JEPI and other popular covered-call ETFs and funds. Katherine Lynch [With Yields Above 4.6%, Intermediate Bonds Have Passed a Tipping Point]( [With Yields Above 4.6%, Intermediate Bonds Have Passed a Tipping Point]( Intermediate-term government-bond funds have reached escape velocity, providing a cushion against potential price declines. Madeline Hume [5 Charts on the Current Market]( [5 Charts on the Current Market]( What to know about global uncertainties, market corrections, and the opportunity cost of sitting in cash. Danny Noonan [How Value ETFs Still Benefit From Meme-Stock Mania]( [How Value ETFs Still Benefit From Meme-Stock Mania]( Analyzing the performance of meme-stock winners over the past three years. Mo'ath Almahasneh [3 Great Dividend-Growth Funds]( [3 Great Dividend-Growth Funds]( These highly rated ETFs and mutual funds buy stocks with a history of growing their dividends. Susan Dziubinski [Staying Invested Beats Timing the Market—Here’s the Proof]( [Staying Invested Beats Timing the Market—Here’s the Proof]( A buy-and-hold approach won out in our head-to-head model. Adam Fleck [10% Stock Weights Are No Longer Shocking for Funds. Should They Be?]( [10% Stock Weights Are No Longer Shocking for Funds. Should They Be?]( More funds are making major commitments to the behemoths. Gregg Wolper [More Than 20% Undervalued, This Cheap Stock With a 4% Dividend Yield Is a Buy]( [More Than 20% Undervalued, This Cheap Stock With a 4% Dividend Yield Is a Buy]( We think this company has some of the best long-term growth prospects in its sector. Travis Miller [What to Do With Your Stock and Bond Investments Now]( [What to Do With Your Stock and Bond Investments Now]( How to position your investment portfolio today based on market valuations and interest-rate expectations. David Sekera, Susan Dziubinski [3 Best New ETFs of 2023]( [3 Best New ETFs of 2023]( As the ETF market continues to expand, investors should consider these three new funds. Bryan Armour [5 Ultracheap Stocks Undervalued by More Than 50% to Buy]( [5 Ultracheap Stocks Undervalued by More Than 50% to Buy]( These stocks may appeal to investors with long time horizons and an appetite for risk. Susan Dziubinski [Lithium: Stocks Are a Buy After Latest Selloff]( [Lithium: Stocks Are a Buy After Latest Selloff]( We’re bullish on lithium prices despite forecasts for continued price declines. Seth Goldstein [After Earnings, Is Palantir Stock a Buy, a Sell, or Fairly Valued?]( [After Earnings, Is Palantir Stock a Buy, a Sell, or Fairly Valued?]( With upside to profitability but a big rally in 2023, here’s what we think of Palantir stock. Malik Ahmed Khan [Is Eli Lilly Stock a Buy or Sell After Earnings and a Big 2023 Rally?]( [Is Eli Lilly Stock a Buy or Sell After Earnings and a Big 2023 Rally?]( With strong results and well-positioned for future growth, here’s what we think of Eli Lilly’s stock. Damien Conover [Is Ford Stock a Buy, a Sell, or Fairly Valued After Earnings?]( [Is Ford Stock a Buy, a Sell, or Fairly Valued After Earnings?]( With the UAW strike behind the firm but a big warranty loss in Q3, here’s what we think of Ford stock. David Whiston [After Earnings, Is Albemarle Stock a Buy, a Sell, or Fairly Valued?]( [After Earnings, Is Albemarle Stock a Buy, a Sell, or Fairly Valued?]( With low lithium prices impacting profits, here’s what we think of Albemarle stock. Seth Goldstein [After Earnings, Is Apple Stock a Buy, a Sell, or Fairly Valued?]( [After Earnings, Is Apple Stock a Buy, a Sell, or Fairly Valued?]( With steady iPhone sales, here’s what we think of Apple stock. Brian Colello [After Earnings, Is Berkshire Hathaway Stock a Buy, a Sell, or Fairly Valued?]( [After Earnings, Is Berkshire Hathaway Stock a Buy, a Sell, or Fairly Valued?]( With solid performance in insurance but softness in rails and energy, here’s our outlook for Warren Buffett’s Berkshire Hathaway. Greggory Warren Chart of the Week [When Will the Fed Start Cutting Interest Rates?]( [When Will the Fed Start Cutting Interest Rates?]( Our latest economic forecast for interest rates, inflation, and GDP growth. Preston Caldwell [Read More]( Share: [facebook]( [twitter]( [linkedin]( Recent Earnings [Groupon: Decline In Gross Billings Slowing, but Focus Is Now on Financial Flexibility]( [Uber: The Platform Is More Easily Attracting Demand and Supply]( [Roblox: Strong User Growth and Cost Leverage Bode Well for 2024]( [Disney: Profits Soar but Key Underlying Metrics Stay Muted; Long-Term Questions Remain]( [Occidental: Higher-Than-Expected Uptime In Gulf of Mexico Drives Elevated Production]( Future-Proof Your Strategy With Morningstar Investor Build a portfolio that's durable, no matter what the market throws your way. Subscribe to Morningstar Investor and get unlimited access to our powerful ratings and performance data, unbiased analysis on thousands of stocks, funds, and ETFs, and portfolio management tools that give you a deep understanding of your investments so you know when to make changes to keep your strategy strong. [Start your free trial today](. 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