Seize the Opportunity: 2 High-Yield Stocks for Your Portfolio

Core Viewpoint - Following the Federal Reserve's 50-basis-point rate cut, markets have reached new all-time highs, prompting investors to consider rebalancing their portfolios towards dividend-paying stocks, particularly Kraft Heinz and AT&T, which offer high yields and potential upside [1]. Group 1: Kraft Heinz - Kraft Heinz has a dividend yield of 4.52% with an annual payout of $1.60, making it attractive for income-seeking investors despite a year-to-date decline of 4% [1][2]. - The stock's technical indicators show signs of recovery, having reclaimed its 20- and 50-day simple moving averages and nearing the critical 200-day SMA, which could signal a bullish trend if surpassed [1]. - Kraft Heinz has a forward price-to-earnings (P/E) ratio of 11.19, with six out of eleven analysts rating it as a Buy, projecting a potential upside of 6.18% [2]. - Upcoming earnings on October 30 are crucial, as the company previously reported earnings per share of $0.78, beating estimates by $0.05 [3]. - Warren Buffett's Berkshire Hathaway holds a 26.9% stake in Kraft Heinz, indicating long-term confidence, and the company is focusing on innovation with new product introductions [4]. Group 2: AT&T - AT&T offers a high dividend yield of 5.22% with an annual dividend of $1.11, and the next payment is scheduled for November 1 [5][6]. - The stock has increased nearly 27% year-to-date, outperforming the S&P 500, but recently pulled back about 5% from its 52-week highs, presenting a potential buying opportunity [5]. - Analysts have assigned a Moderate Buy rating to AT&T, with a nearly 7% forecasted upside, and Wells Fargo raised its price target from $22 to $25, implying a 17% potential upside [6]. - The company is set to release its next earnings report on October 23, having met expectations with earnings of $0.57 per share on $29.8 billion in revenue in the last quarter [7]. - AT&T's strong dividend and financial performance make it an attractive defensive play in a declining rate environment, providing both stability and growth potential [8]. Group 3: Portfolio Strategy - Both Kraft Heinz and AT&T present compelling opportunities for investors looking to diversify into high-yield stocks as interest rates decline, with Kraft Heinz showing value play potential and AT&T demonstrating solid momentum [9].