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After a hectic week filled with major earnings reports, an AI summit, robotaxis, and key inflation data, this coming week will be shorter but still significant.

Here’s what’s on the agenda for the week ahead.

Is the stock market closed on Columbus Day?

No, the New York Stock Exchange (ICE) and the Nasdaq (NDAQ) will remain open Monday during Columbus Day, also known as Indigenous Peoples’ Day.

But bond markets will be closed.

Big bank earnings

Several major banks and financial institutions are set to release their quarterly earnings, offering valuable insights into their performance and broader economic trends. Goldman Sachs (GS), Bank of America (BAC), and Citigroup (C) will kick off the week with their earnings reports Tuesday, shedding light on how well these financial giants have navigated recent market volatility.

Discover Financial Services (DFS) and Citizens Financial Group (CFG) will reveal their financial health Wednesday, providing a closer look at consumer credit trends and regional banking performance. On Thursday, earnings from Morgan Stanley (MS), Blackstone (BX), and M&T Bank Corporation (MTB) will follow, giving insight into investment banking, private equity, and regional banking sectors. Finally, the week closes Friday with American Express (AXP) reporting its earnings.

Netflix and other important earnings

On Tuesday, Johnson & Johnson (JNJ), UnitedHealth Group (UNH), and Walgreens (WBA) will release their earnings reports before the opening bell, offering a glimpse into the healthcare and insurance sectors. On Thursday, the spotlight shifts to technology and travel, as Taiwan Semiconductor Manufacturing Company (TSM), Netflix (NFLX), American Airlines (AAL), and Alaska Airlines (ALK) will release their financial report cards.

Macroeconomic data to watch

While this week won’t bring any blockbuster macroeconomic reports, several key indicators will still provide valuable insights into the health of the U.S. economy. On Wednesday, the Import Price Index for September will be released, offering a glimpse into inflationary pressures from imported goods.

On Thursday, initial jobless claims will provide an updated snapshot of the U.S. labor market. The release of U.S. retail sales data will shed light on consumer spending patterns, a key driver of economic growth. Industrial production data will offer insights into manufacturing output and factory activity nationwide. Additionally, homebuilder confidence for October will gauge the housing market’s health, providing an outlook on construction activity and the broader real estate sector.

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This year, some notable companies have cut or eliminated their dividends. For example, former stalwarts Walgreens and 3M ended decades-long streaks of dividend growth with deep cuts to their payouts. It’s a situation that can make some investors want to give up altogether on income investing.

However, while some formerly reliable companies have disappointed investors on the dividend front in recent years, others have continued to make their payments no matter what. Enterprise Products Partners (NYSE: EPD), Oneok (NYSE: OKE), and NextEra Energy (NYSE: NEE) stand out to a few Fool.com contributors for their dividend stability. Here’s why you should consider adding them to your portfolio.

Enterprise Products Partners is built to pay you well

Reuben Gregg Brewer (Enterprise Products Partners): For 26 consecutive years, midstream energy giant Enterprise Products Partners has increased its distributions. That’s a huge commitment to its unitholders, but there’s more for income investors to like here than just the distribution history. It all starts with its master limited partnership structure, which is designed to pass income on to investors in a tax-advantaged manner. (A portion of the distribution is usually return of capital.) So down to its foundation, Enterprise is about paying its investors well.

Then, factor in its business model. Enterprise owns energy infrastructure like pipelines, storage, refining, and transportation assets that are vital to the energy sector’s operation. However, unlike other segments of the industry, the midstream segment is largely fee driven. Enterprise generates reliable cash flows based on the use of its assets, so the often-volatile prices of oil and natural gas don’t really have that big an impact on its financial results. Demand for energy, which is usually strong even when oil prices are weak, is the key determinant of Enterprise’s success.

Then there’s the fact that Enterprise has an investment-grade rated balance sheet. Moreover, its leverage is normally toward the low end of its peer group, so it is conservative on both an absolute and relative basis. Lastly, the partnership’s distributable cash flow covers its distribution 1.7 times over.

All in all, a lot would have to go wrong before Enterprise Products Partners would need to cut its distribution. It is far more likely that it will continue to grow those disbursements, albeit slowly, as its capital investment plans pan out. But slow and steady distribution growth combined with a huge 7% yield will probably sound like music to most dividend investors’ ears.

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Over a quarter century of growth and stability (and more growth coming down the pipeline)

Matt DiLallo (Oneok): Pipeline giant Oneok has proven its dividend durability over the decades. It has achieved more than a quarter century of dividend stability. While it hasn’t increased its payment every year during that period, it has a strong track record on payout hikes. Since 2013, Oneok has produced peer-leading total dividend growth of more than 150%. That’s impressive, considering that the world experienced two notable periods of oil price volatility during that period.

Oneoke has delivered sustainable earnings growth over the years. Its portfolio of pipelines and related midstream infrastructure generates predictable fees backed by long-term contracts and government-regulated rate structures. Its earnings grow as the volumes flowing through that infrastructure increase due to production growth, organic expansion projects, and acquisitions.

The company has been on an acquisition-fueled expansion binge in recent years. Last year, it bought Magellan Midstream Partners in a transformational $18.8 billion deal that increased its diversification and cash flow. The highly accretive deal will add an average of more than 20% to its free cash flow per share through 2027. That supports management’s view that Oneok will be able to grow its dividend by 3% to 4% annually during that period while also repurchasing shares and reducing its leverage ratio.

Oneok followed that up with a $5.9 billion deal to buy Medallion Midstream and a meaningful interest in EnLink Midstream this August. The transaction will be immediately accretive to its free cash flow and capital allocation strategy. After closing that deal, Oneok plans to buy the rest of EnLink, further boosting its cash flow per share. The company also expects to complete additional organic expansion projects, further enhancing its growth rate.

The midstream giant’s investments will help fuel its dividend growth for the next several years, even if there’s another market downturn. Those features make Oneok a great stock to buy for those seeking reliable dividends.

A steady dividend grower

Neha Chamaria (NextEra Energy): NextEra Energy, which has a yield of 2.6% at its current stock price, has rewarded its shareholders through thick and thin, and management is determined to continue doing so. The utility and clean energy giant has paid regular dividends for decades, but more importantly, increased them steadily over time. Between 2003 and 2023, the compound annual growth rate (CAGR) of NextEra Energy’s dividend was nearly 10%, backed by a 9% CAGR in its adjusted earnings per share (EPS) and an 8% CAGR in operating cash flow during the period.

NextEra Energy operates two businesses — Florida Power & Light Company (the largest electric utility in Florida) and clean energy company NextEra Energy Resources (the world’s largest generator of wind and solar energy). So while its regulated utility business generates stable cash flows, clean energy is where its growth largely comes from.

NextEra Energy expects its adjusted EPS to grow at an annualized rate of 6% to 8% through 2027, and expects annual dividend hikes of around 10% through 2026 as it pumps billions of dollars into both businesses.

More specifically, NextEra Energy plans to spend over $34 billion on Florida Power & Light between 2024 and 2027 and more than $65 billion on renewable energy over the next four years. That’s massive, and if done right, should steadily boost NextEra Energy’s earnings and cash flows to support bigger dividends for years, regardless of how the economy fares.

Don’t miss this second chance at a potentially lucrative opportunity

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:

• Amazon: if you invested $1,000 when we doubled down in 2010, you’d have $21,022!*

• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $43,329!*

• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $393,839!*

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 October 7, 2024

Matt DiLallo has positions in 3M, Enterprise Products Partners, and NextEra Energy. Neha Chamaria has no position in any of the stocks mentioned. Reuben Gregg Brewer has positions in 3M. The Motley Fool has positions in and recommends NextEra Energy. The Motley Fool recommends 3M, Enterprise Products Partners, and Oneok. The Motley Fool has a disclosure policy.

Don’t Give Up on Dividends: 3 Dividend Stocks That Reward You Through Thick and Thin was originally published by The Motley Fool

Market News and Data brought to you by Benzinga APIs

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

The artificial intelligence chipmaker Nvidia (NASDAQ: NVDA) has amassed close to a $3.2 trillion market cap, making it one of the world’s largest chipmakers. It now consumes more than 6% of the broader benchmark S&P 500 index. Over the last five years, Nvidia has grown annual revenue by 458% and the stock is up an incredible 2,009%. Given the potential for AI to disrupt life as we know it, it’s understandable that investors are so excited about the stock.

But the lure of these kinds of gains is naturally going to attract competition. Now, one of Nvidia’s competitors is planning an initial public offering (IPO) and claiming to manufacture chips that can vastly outperform Nvidia at a fraction of the price. Let’s take a look.

20x better than Nvidia?

Last week, the AI chipmaker Cerebras filed its registration statement with the Securities and Exchange Commission (SEC) with the intent to go public. In a press release from 2021, Cerebras said it had a valuation of $4 billion after a $250 million series F financing round. The company is targeting a $1 billion IPO at a $7 billion to $8 billion valuation.

In its registration statement, Cerebras cites Nvidia as a competitor, as well as other large AI companies such as Advanced Micro Devices, Intel, Microsoft, and Alphabet. Here is a description of what Cerebras does:

Cerebras’ pitch is that bigger is better. That’s because the company has designed a chip that is the size of a full silicon wafer, and the largest ever sold. The company believes that the size advantage leads to less time moving data. Furthermore, Cerebras has a flexible business model in which clients can buy Cerebras products to have at their facilities or through a consumption-based subscription through the company’s cloud infrastructure.

Cerebras clearly wants investors to compare, or at least associate, the company with Nvidia. Nvidia is mentioned 12 times in the registration statement. Cerebras also provides a side-by-side comparison of its Wafer-Scale Engine-3 chip versus Nvidia’s H100 graphics processing unit (GPU), which is considered the most powerful GPU on the market.

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Cerebras CEO Andrew Feldman publicly said the company’s inference offering is 20 times faster than Nvidia’s at a fraction of the price. In 2023, Cerebras generated about $78.7 million of revenue, up 220% year over year. Through the first half of 2024, Cerebras has grown revenue to $136.4 million. The company still hasn’t earned a profit, having reported a nearly $67 million loss through the first half of 2024. These numbers also pale in comparison to Nvidia, which recently reported second-quarter revenue of $30 billion and a profit of roughly $16.6 billion.

Will Cerebras make a splash?

With big publicity from news publications and claims of being 20 times faster than Nvidia, I think it’s safe to say that Cerebras already has and will continue to make a splash.

Depending on the excitement investment bankers can drum up during the company’s road show and market conditions, I wouldn’t be surprised to see Cerebras go public at a higher valuation than expected. AI has been all the buzz and the IPO market has been flat for a few years now, so there could be pent-up demand on Wall Street.

Will Cerebras overtake Nvidia? Only time will tell. Its product offerings are impressive, but it still has a ways to go to get its financial profile in line with Nvidia. Furthermore, there may be some advantages to Nvidia having smaller chips and it remains to be seen whether Cerebras can compete with Nvidia’s software language CUDA — although the company does say that its software program “eliminates the need for low-level programming in CUDA.”

While everything sounds great, there is likely still a “show me” component to this story. After all, the bulk of Cerebras’ revenue comes from one customer. Nvidia also has a leading market share in the AI chip space and relationships with many large clients. Who’s to say Nvidia couldn’t use its size — and likely resource — advantage to develop a similar large wafer chip? There’s a lot left to play out, but this could be one of the more interesting developments for market watchers to pay attention to.

Don’t miss this second chance at a potentially lucrative opportunity

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:

• Amazon: if you invested $1,000 when we doubled down in 2010, you’d have $21,266!*

• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $43,047!*

• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $389,794!*

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 October 7, 2024

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Microsoft, and Nvidia. The Motley Fool recommends Intel and recommends the following options: long January 2026 $395 calls on Microsoft, short January 2026 $405 calls on Microsoft, and short November 2024 $24 calls on Intel. The Motley Fool has a disclosure policy.

The Newest Artificial Intelligence Stock Has Arrived — and It Claims to Make Chips That Are 20x Faster Than Nvidia was originally published by The Motley Fool

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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.