News Classic

Dividend yields have been falling over the past year because of the nearly unabated rally in the stock market. The S&P 500‘s dividend yield is down to about 1.2%, near its lowest level in about 20 years. That’s down from 1.6% at this time last year, following a more than 30% rally in the broad market index.

While dividend yields are generally lower these days, there are still some compelling income opportunities. Here are four top dividend stocks yielding more than 4% to scoop up this December.

Are You Missing The Morning Scoop?  Breakfast News delivers it all in a quick, Foolish, and free daily newsletter. Sign Up For Free »

Brookfield Renewable (NYSE: BEPC)(NYSE: BEP) currently yields over 4.5%. The leading global renewable-energy producer has grown its payout at a 6% compound annual rate over the past 20 years. It expects to deliver 5% to 9% annual growth in the future.

Four catalysts power that plan. The company expects a combination of inflation-linked rate increases on its existing power purchase agreements, margin enhancement activities like capturing higher market prices as legacy contracts expire, development projects, and M&A activities to grow its funds from operations (FFO) per share by more than 10% annually over the next decade. That growth is highly visible and secured through 2029 and increasingly visible and secured beyond that timeframe. A big factor is the company’s massive backlog of development projects, which alone should add 4% to 6% to its FFO per share each year through the end of the decade.

Chevron (NYSE: CVX) currently yields just over 4%. The oil giant has increased its dividend annually for 37 straight years. It has grown its payout at a peer-leading pace over the past five years, including by 8% earlier this year.

The company currently expects to deliver more than 10% annual free cash flow growth through 2027, assuming oil averages $60 a barrel. Fueling that forecast is its high-return capital program focused on investing in growing its lowest-cost and highest-margin assets. Meanwhile, the plan has ample upside from higher oil prices and the company’s strategy to acquire Hess, with the latter having the potential to more than double its free cash flow by 2027. Chevron also has a well-protected downside thanks to its strong balance sheet. It has the capacity to continue investing in its business, growing its dividend, and repurchasing shares at the low end of its $10 billion-$20 billion annual target range, even if oil prices average $50 a barrel over the next couple of years.

Story Continues

By Lawrence White

LONDON (Reuters) – Standard Chartered will target $200 billion in new assets and double digit growth in income from its wealth business over the next five years, it said on Tuesday, as part of a wider strategy to shift to higher fee-earning businesses.

The statement from the bank expands on ambitions it unveiled in October to trim back its retail banking business in some markets in order to fund a $1.5 billion pound investment in its wealth unit, particularly targeting mass affluent customers.

The bank will also aim to double the size of its relationship manager team by 2028, it said, as well as upgrading branches and investing in technology to win new clients.

The shift in focus from ordinary retail banking to target more affluent clients mirrors a shift at rival HSBC, which has in recent years slashed its retail presence in markets such as the U.S. and France while investing in wealth management.

“As we continue to focus on our competitive strengths, a significant portion of our investment will enhance those capabilities that support our clients’ international banking needs,” said Judy Hsu, CEO, Wealth and Retail Banking at Standard Chartered.

Standard Chartered said last month it is exploring a potential divestment of its wealth and retail banking operations in Botswana, Uganda and Zambia, as part of the shift in investment.

(Reporting by Lawrence White; editing by Sinead Cruise and Jason Neely)

Morgan Stanley estimates that just four companies — Microsoft, Amazon, Alphabet, and Meta Platforms (NASDAQ: META) — will spend a combined $300 billion on data center infrastructure and chips during 2025 alone, to support their ambitions in the artificial intelligence (AI) space.

Cathie Wood is the founder of Ark Investment Management, which operates several exchange-traded funds (ETFs) focused on innovative technology stocks. She believes software companies will be the next big opportunity in AI, predicting they could generate $8 in revenue for every $1 they invest in chips from suppliers like Nvidia.

Start Your Mornings Smarter! Wake up with Breakfast news in your inbox every market day. Sign Up For Free »

Those four tech giants could earn a mind-boggling payoff from their AI infrastructure spending if she’s right, but here’s why investors might regret not buying Meta Platforms stock, in particular, in 2025.

Meta is the parent company of social networks Facebook, Instagram, WhatsApp, and Messenger. Together, those apps serve almost 3.3 billion people around the world every day, and AI is playing an important role in shaping their experience.

Meta developed an AI-powered content recommendation engine that learns what each user likes to see, and uses that information to curate their Facebook and Instagram feeds. CEO Mark Zuckerberg says this strategy drove an 8% increase in the amount of time users spend on Facebook this year, and a 6% increase for Instagram. That means each user sees more ads, which translates into more revenue for Meta.

Meta is also launching new AI-powered features like Meta AI, a virtual assistant accessible through its apps. It can generate images and text, and even join group chats to settle debates or offer recommendations for fun activities. The quality of an AI assistant depends on the large language model (LLM) upon which it is built, and since Meta has an enormous pool of data from billions of posts on its social networks, it was able to create an advanced family of LLMs called Llama.

Most popular LLMs (like those developed by OpenAI and Anthropic) are closed source, whereas Llama is open source. That means millions of developers are regularly digging through the code, which helps Meta rapidly identify bugs and improve its functionality.

Llama 3.2 is the latest version of Meta’s flagship LLM, but Zuckerberg says the company is on track to launch Llama 4 in 2025. It’s improving so quickly that he believes it will be the most advanced in the entire industry. That would be an impressive accomplishment, considering start-ups like OpenAI were initially several years ahead.

Story Continues

Meta generated a record $40.6 billion in total revenue during the recent third quarter of 2024 (ended Sept. 30). Most of that revenue comes from selling advertising slots to businesses, and the company has an incredible track record of launching new features and monetizing them in that way.

Meta originally placed ads in its content feeds to catch users’ attention while they were scrolling through posts from friends and family members. But video content formats like Stories and Reels became significant contributors to the company’s revenue, even though rival platforms like Snap‘s Snapchat and TikTok were first to market with similar features.

Meta AI already has over 500 million monthly active users, and while it’s free to use, the company says there will be opportunities to monetize it in the future. Personally, I think advertisers would pay money to link their websites or products within Meta AI’s responses when a user asks a relevant question.

But Meta AI also paves the way for new features like Business AI. Zuckerberg believes every business using Meta’s apps will eventually have its own AI-powered virtual agent, which can handle incoming inquiries from customers, and potentially even process sales. Businesses could customize their agent to suit their own needs by training it on their product inventory, or by teaching it to respond to customers in a way that fits their brand.

Meta will almost certainly charge money for a tool like Business AI, potentially on a per-message basis or even on a subscription basis, which would unlock entirely new revenue streams.

Meta stock soared 532% from its 2022 low point of around $90. However, based on its trailing 12-month earnings per share (EPS) of $21.23, it trades at a price-to-earnings (P/E) ratio of just 27.2, which is still cheap.

It’s a 15% discount to the Nasdaq 100, which trades at a P/E ratio of 32.2. It also makes Meta cheaper than every other AI stock with a valuation of $1 trillion or more, except for Alphabet, which is currently fighting several regulatory battles against the U.S. government:

Meta stock looks even cheaper on a forward basis. Wall Street’s consensus estimate (according to Yahoo!) suggests the company will generate $25.33 in EPS during 2025, placing its stock at a forward P/E ratio of 22.7. In other words, Meta stock will have to soar by 42% next year just to trade in line with the P/E ratio of the Nasdaq 100.

Llama will be the key to Meta’s success in the AI race from here, because as mentioned, quality AI software starts with a quality LLM — but developing LLMs is not cheap. It took around 16,000 of Nvidia’s H100 graphics processors (GPUs) to train Llama 3, but Llama 4 is going to need over 100,000.

That’s why Meta is on track to spend up to $40 billion on AI infrastructure in 2024, and it plans to spend even more in 2025. In fact, Morgan Stanley thinks the company could spend a whopping $52 billion next year.

If Wood is right, Meta could eventually reap hundreds of billions of dollars in revenue from that AI spending, which will translate into spectacular returns for investors. Given its attractive valuation, Meta stock might be the best pick out of the AI giants to buy next year.

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $358,460!*

• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $44,946!*

• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $478,249!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

See 3 “Double Down” stocks »

*Stock Advisor returns as of December 2, 2024

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Cathie Wood Says Software Is the Next Big AI Opportunity — 1 Super Stock You’ll Regret Not Buying in 2025 If She’s Right was originally published by The Motley Fool

TOKYO (AP) — Asian shares were mostly higher on Tuesday after technology stocks pulled Wall Street to another record finish.

Japan’s benchmark Nikkei 225 jumped 1.7% to 39,183.12 in afternoon trading. Shares in Tokyo Electron surged 4.2% after the U.S. Commerce Department expanded the list of Chinese computer chip-related companies subject to export controls.

Some analysts think Japanese stocks could end up benefiting from President-elect Donald Trump’s latest threats to raise tariffs on China and other countries. During the weekend, Trump threatened 100% tariffs against a group of developing economies, including China and Brazil, if they act to undermine the U.S. dollar.

Taiwan’s Taiex gained 1.3% and the Sensex in India was up 0.6%.

Australia’s S&P/ASX 200 gained 0.6% to 8,495.20. South Korea’s Kospi jumped 1.8% to 2,497.36, after inflation data showed a rebound but remained low enough to keep rate-cut thoughts alive for early 2025.

Hong Kong’s Hang Seng added 0.8% to 19,708.01, while the Shanghai Composite edged up 0.5% to 3,381.05. Reports said Chinese leaders would meet next week to discuss planning for the coming year, an annual economic work meeting that investors are hoping to bring fresh stimulus to help spur growth in the world’s second-largest economy.

On Monday, the S&P 500 rose 0.2% from the previous session’s all-time high to post a record for the 54th time this year, closing at 6,047.15. The Dow Jones Industrial Average fell 0.3% to 44,782.00, while the Nasdaq composite gained 1% to 19,403.95.

Super Micro Computer, a stock that’s been on an AI-driven roller coaster, soared 28.7% to lead the market after it said an investigation into allegations of misconduct and the resignation of its public auditor found no evidence of misconduct by its management or by the company’s board.

Big Tech stocks also helped prop up the market. Gains of 1.8% for Microsoft and 3.2% for Meta Platforms were the two strongest forces pushing upward on the S&P 500.

Intel was another propellant during the morning, but it lost an early gain to fall 0.5% after the chip company said CEO Pat Gelsinger has retired and stepped down from the board. Intel is looking for Gelsinger’s replacement, and its chair said it’s “committed to restoring investor confidence.”

Intel recently lost its spot in the Dow Jones Industrial Average to Nvidia, which has skyrocketed in Wall Street’s frenzy around AI.

Stellantis, meanwhile, skidded following the announcement of its CEO’s departure. Carlos Tavares steps down after nearly four years in the top spot of the automaker, which owns car brands like Jeep, Citroën and Ram, amid an ongoing struggle with slumping sales and an inventory backlog at dealerships. The world’s fourth-largest automaker’s stock fell 6.3% in Milan.

Story Continues

By Amanda Cooper

LONDON (Reuters) -The euro edged up on Tuesday, regaining some poise after political turmoil in France sent traders scrambling for hedging protection against further price swings, while the yuan hit a 13-month low on tariff risks and weakness in China’s economy.

The yen, which has gained nearly 4.5% in the last two weeks, retreated slightly against the dollar, but remained near six-week highs, as traders are growing increasingly confident that Japan may hike rates this month.

The euro, which had been the weakest G10 currency through November, began this month with a 0.7% fall on Monday and was last hovering at $1.0487, as France’s government heads for collapse over a budget impasse. [EUR/GVD]

French Prime Minister Michel Barnier faces a vote of no confidence on Wednesday after fierce opposition from across the political spectrum to his budget, which contains painful tax rises and spending cuts aimed at repairing the country’s precarious finances.

Demand for hedges, as reflected by euro options volatility, has hit its highest since March 2023 this week and, with the combination of a string of weak data, political uncertainty in major euro zone economies and the seemingly unstoppable dollar, the single European currency could struggle.

“There is just so much going against the euro at the moment…the list of headwinds is just growing longer by the day,” City Index market strategist Fiona Cincotta said.

“Today, you’ve got political instability in France, obviously and even in Germany, it’s rumbling and there’s sort of a sense of unease in that you’ve got the weak economic outlook,” she said.

In the last month, the euro has lost 3% against the dollar and more than 1% against both the pound and the Swiss franc.

DOLLAR RESTING, FOR NOW

The dollar typically suffers seasonal weakness in December as companies tend to buy foreign currencies. However, traders are keeping a wary eye this year on President-elect Donald Trump’s incoming administration and supporting the greenback.

Over the weekend, Trump threatened punitive tariffs unless BRICS member countries committed to the dollar as a reserve currency.

“The remarks strengthen the view that Trump may not look to weaken the dollar during his presidential term and will instead be relying on tariffs to tackle the U.S.’s large goods trade imbalance,” Rabobank strategist Jane Foley said in a note.

“We maintain the view that euro/dollar could drop to parity around the middle of next year. The timing may coincide with the introduction of new tariffs by Trump.”

Story Continues

(Reuters) – Honeywell on Monday cut its profit and sales forecasts for the fourth quarter and the full year to take into account investments associated with an agreement to provide aviation-related technology for Bombardier’s aircraft.

Honeywell’s shares fell about 2% to $226 after the bell.

The agreement will provide Honeywell’s avionics, propulsion and satellite communication technologies for Bombardier’s aircraft.

Honeywell said it expects the agreement to have a near-term impact on its financials, given the investments for research and development. The company added that it estimates revenue potential of up to $17 billion over the duration of the agreement.

Honeywell lowered its fourth-quarter sales forecast to between $9.8 billion and $10.0 billion, from its prior forecast range of $10.2 billion to $10.4 billion.

It also cut its adjusted earnings per share outlook to between $2.26 and $2.36, compare with its previous forecast range of $2.73 to $2.83.

Honeywell and Bombardier also said that all pending litigation between the companies has been resolved.

Bombardier had previously alleged Honeywell of selling propulsion systems to its rivals on more favorable terms, despite guarantees that the Canadian planemaker would get the best price.

(Reporting by Abhinav Parmar in Bengaluru; Editing by Shounak Dasgupta)