As the aging bull market presses ahead, it is pretty easy to see there has been a big rotation out of growth and momentum stocks and into value and cyclical companies. That rotation could be reverting back to the mean. Given the massive move since the market lows of March 2020, many investors sense that it is time to move to stocks that still have growth potential but also pay a solid dividend. Despite some hand wringing over the potential for higher interest rates, they remain near generational lows across the board.
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We decided to screen the Goldman Sachs Americas Conviction List, which is a collection of the top equity ideas that pay a solid and dependable dividend higher than the S&P 500 yield of 1.31% and the 30-year U.S. Treasury bond of 1.91%.

We found six that look like outstanding total return ideas now. All are positioned well for the rest of 2021 and beyond. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Bristol-Myers Squibb

This remains a solid pharmaceutical stock to own long term and offers among the best values now for investors. Bristol Myers Squibb Co. (NYSE: BMY) is a global pharmaceutical company focused on discovering, developing, licensing and marketing chemically synthesized drugs or small molecules and biologics in various therapeutic areas, including virology comprising human immunodeficiency virus infection (HIV), oncology, neuroscience, immunoscience and cardiovascular.

The company’s products include the following:

• Opdivo for anti-cancer indications
• Eliquis, an oral inhibitor targeted at stroke prevention in adult patients with non-valvular atrial fibrillation, and the prevention and treatment of venous thromboembolic disorders
• Orencia for adult patients with active RA and prostate-specific antigen, as well as reducing signs and symptoms in pediatric patients with active polyarticular juvenile idiopathic arthritis.

Shareholders receive a 2.88% dividend. Goldman Sachs has a massive $94 price target, while the Wall Street consensus target is $75.37. Bristol-Myers Squibb stock closed trading at $68.15 on Thursday.

Citizens Financial

This stock remains a top financial pick across Wall Street. Citizens Financial Group Inc. (NYSE: CFG) operates approximately 2,700 ATMs and 1,000 branches in 11 states in the New England, Mid-Atlantic and Midwest regions, as well as through online, telephone and mobile banking services, and it maintains approximately 130 retail and commercial non-branch offices.
Citizens Financial operates in two segments. The Consumer Banking segment offers traditional banking products and services, including checking and savings accounts, home and education loans, credit cards, business loans, mortgage and home equity lending and unsecured product finance and personal loans, as well as wealth management and investment services to retail customers and small businesses. This segment also provides indirect auto finance for new and used vehicles through auto dealerships.
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The Commercial Banking segment offers various financial products and solutions, such as loans and leasing, trade finance, deposit and treasury management, cash management, and foreign exchange and interest rate risk management solutions. It also provides loan syndications, corporate finance, merger and acquisition, and debt and equity capital markets capabilities.

Holders of Citizens Financial Group stock receive a 3.65% dividend. The Goldman Sachs price target of $51 target is just below the $52.00 consensus estimate. The stock closed on Thursday at $42.85.

Marathon Petroleum

This is a solid way for investors who are more conservative to play the energy sector, and it resides in the U.S. Conviction list. Marathon Petroleum Corp. (NYSE: MPC) is one of the largest independent petroleum refining and marketing companies in the United States.

Until just recently, the company operated approximately 2,750 retail sites under the Marathon and Speedway brands. In addition, it operates a logistics network of pipelines, barges, trucks and terminals that store and transport crude and products.

Last year, the company announced it would sell Speedway to 7-11 in an all-cash deal valued at $21 billion, or $16.5 billion after-tax. The sale transforms the company’s balance sheet and creates options to revisit the corporate structure of MPLX. Many on Wall Street feel that with Speedway removed, the dislocation in refining value becomes even more transparent as the company trades much cheaper than its industry peers do. The deal now is expected to close before the end of the year.

Shareholders receive a 4.15% dividend. The $65 Goldman Sachs price target is less than the $70.93 consensus target. Marathon Petroleum stock closed on Thursday at $55.93.

PepsiCo

This top consumer staples stock fits the bill for nervous investors, and the company posted strong second-quarter results. PepsiCo Inc. (NYSE: PEP) operates as a food and beverage company worldwide. Its Frito-Lay North America segment offers Lay’s and Ruffles potato chips; Doritos, Tostitos and Santitas tortilla chips; and Cheetos cheese-flavored snacks, branded dips and Fritos corn chips.

The Quaker Foods North America segment provides Quaker oatmeal, grits, rice cakes, natural granola and oat squares, as well as the recently name changed Aunt Jemima mixes and syrups, and Quaker Chewy granola bars, Cap’n Crunch cereal, Life cereal and Rice-A-Roni side dishes.
Pepsi’s North America Beverages segment offers beverage concentrates, fountain syrups and finished goods under the Pepsi, Gatorade, Mountain Dew, Diet Pepsi, Aquafina, Tropicana Pure Premium, Sierra Mist and Mug brands, as well as ready-to-drink tea and coffee, and juices.

Shareholders receive a 2.74% dividend. Goldman Sachs has set a $170 price target on PepsiCo stock. The consensus target of $156.65 is close to the most recent close at $156.81.
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Raytheon Technologies

This stock has rallied smartly off its 52-week low but still offers perhaps the best value in the defense and aerospace sector. Raytheon Technologies Corp. (NYSE: RTX) is an industry leader in defense, government electronics, space, information technology and technical services.

With a history of innovation spanning 97 years, Raytheon provides state-of-the-art electronics, mission systems integration, C5I products and services, sensing, effects and mission support for customers in more than 80 countries.

In 2019, United Technologies and Raytheon agreed to merge their businesses to create a new aerospace and defense powerhouse. The two companies received unanimous approval from their respective boards, and the merger is finally complete, with the new company now called Raytheon Technologies.

Shareholders receive a 2.33% dividend. The Goldman Sachs price objective is $104. The consensus for Raytheon Technologies stock is $98.59. The shares closed at $87.65 apiece on Thursday.

Realty Income

This is an ideal stock for growth and income investors looking for a safer idea for the rest of 2021. Realty Income Corp. (NYSE: O) is an S&P 500 company dedicated to providing stockholders with dependable monthly income.

The company is structured as a real estate investment trust, and its monthly dividends are supported by the cash flow from over 6,500 real estate properties owned under long-term lease agreements with commercial tenants.

To date, the company has declared 604 consecutive common stock monthly dividends throughout its 51-year operating history and increased the dividend 108 times since its public listing in 1994.

Realty Income stock investors receive a 4.02% distribution. The $84 Goldman Sachs price objective compares with a $75.17 consensus figure and with the $70.22 close on Thursday.

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These six top stock picks on Goldman Sachs Americas Conviction List all pay dividends that are much higher than the 30-year U.S. Treasury bond. While not guaranteed as the bond is, they probably offer more safety in a rising interest rate environment. All offer great total return potential and less potential volatility in a very overbought stock market that may be poised for a long-needed correction.

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