"When Stock Prices Drop, It's an Opportunity"...Stocks Recommended by Analysts Amid Market Plunge [Weekend Money]

"5% Dividend Yields Stand Out Against Market Interest Rates"

In light of the current semiconductor-centered market adjustment phase, securities analysts are advising investors to seize the opportunity to invest in exchange-traded funds (ETFs) and stocks with attractive dividend yields.

Kang Songcheol, a researcher at Eugene Investment & Securities, noted, "Over the past month, 3.5 trillion won has flowed into semiconductor ETFs, and nearly 7 trillion won has been directed toward leveraged products focused on single stocks like Samsung Electronics and SK hynix." He suggested, "While this concentration signals heavy crowding, it also means that there are plenty of quality stocks that have fallen out of the spotlight, presenting opportunities to buy them at bargain prices."

He explained that there are products currently offering dividend yields that are attractive compared to prevailing market interest rates. Kang stated, "In the case of high-dividend stocks, during periods in the past when dividend yields exceeded 6%, stock prices generally rose even excluding dividends. Most periods when high-dividend stocks saw yields above 6% were from 2022 to 2023, when bank deposit rates hovered around 4%." He added, "Now that market interest rates are around 3%, we judge that even a dividend yield in the mid-5% range is attractive when compared to interest rates."

Three standards for investing in dividend stocks and high-dividend ETFs were presented: ▲ Those that increased dividends for two consecutive years through last year ▲ Those with robust earnings trends through the most recent quarter and reasonable valuations ▲ Stocks with a current dividend yield above 4% or a high proportion of treasury shares.

Dividend stocks that satisfy all three criteria in the non-financial sector include SL, POSCO International, SNT Energy, and Hi-Lok Corporation. In the financial sector, NH Investment & Securities, Korea Financial Group, and BNK Financial Group were selected.

As of the closing price on the 10th, leading ETFs based on dividend yield in the real estate sector included 'TIGER REITs Real Estate Infrastructure' with a yield of 9.8%. In the stock sector, 'TIME Korea Plus Dividend Active' recorded a 6.3% yield, and 'KoAct Dividend Growth Active' achieved 5.8%. Among dividend ETFs, 'TIME US Dividend Dow Jones Active' posted a yield of 5.0%, while 'TIGER Korea Dividend Dow Jones' recorded 4.0%.

There are also ETFs with dividend yields in the 3% to 4% range but with rapid dividend growth compared to previous years. KODEX High Dividend posted a dividend growth rate of 18% compared to a year earlier. PLUS High Dividend achieved a 24% increase over the same period, TIGER KOSPI High Dividend was up 45%, and KODEX Bank's dividends grew by 49%.

This content was produced with the assistance of AI translation services.