3 Dividend Stocks to Buy During the Coronavirus Sell-Off

Monday's 2,000-point pullback has fueled significant concerns about the stability of the U.S. economy and current valuations in the market.

The ongoing battle with COVID-19 has stopped cruise ships, airlines, and hotel companies in their tracks.

We've seen Italy effectively shut down its economy. Last night, the Prime Minister announced the country would begin quarantining its entire population of 16 million citizens.

And the spread continues across more U.S. states...

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The Trump administration has floated the idea of a possible cut to payroll taxes and other stimulus factors. But there is another shoe waiting to drop in this market: a restructuring of risk and potentially massive downgrades in corporate bonds.

Such news would rattle investors and lead many companies to reassess their cash flow due to ratings downgrades.

That said, the pullback has created a number of opportunities for investors to tap into companies with strong cash flows, low debt, and solid dividends.

Today, I'm highlighting three different dividend stocks to buy with the recent market pullback.

Dividend Stocks to Buy, No. 3

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T Rowe Price Group Inc. (NASDAQ: TROW) is a Baltimore-based financial giant. The company offers mutual funds, money advisory services, and retirement plans to individuals and institutions.

Shares have pulled back from their 52-week high as investors head for the exits after the recent decline in the market.

But this is one of the best-managed financial institutions in the world. It rarely makes mistakes with other people's money.

TROW stock pays a solid dividend and is well known for its ability to manage debt.

It currently has a debt-to-equity ratio of 0.02. This makes it one of the most secure investments when it comes to shareholder equity.

A dividend of 3.32% is attractive given the strength of the company's balance sheet and its limited exposure to debt.

Dividend Stocks to Buy, No. 2: Cato Corp.

The current market for retail companies is negative.

The ongoing retail apocalypse has battered brick-and-mortar operators and fueled a massive number of bankruptcies in the space.

Of course, the most important metric to keep an eye on in the retail space to get a sense of future survivors is the debt level.

Cato Corp. (NYSE: CATO) is a global retail name that has been around since 1946.

The firm operates more than 1,300 stores under the names of Cato, Cato Plus, It's Fashion, Versona, and It's Fashion Plus.

Cato has largely anchored itself to the footprint strategy of Walmart Inc. (NYSE: WMT) in highly trafficked strip malls.

It currently pays a dividend of 9.38%, and it has the cash on hand to cover this expense.

Cato's current ratio sat at 2.0 at the end of the October quarter. This signals solid short-term financial strength.

The company should be able to weather this storm and return back to solid levels once the current market storms pass.

Dividend Stocks to Buy, No. 1: VICI Properties Inc.

Finally, we conclude with one of the top real estate investment trusts (REITs) in the world.

Right now, we're seeing a number of REITs struggle due to the recent downturn in consumer traffic in malls, hotels, and other destinations.

VICI Properties Inc. (NASDAQ: VICI) is a casino-property manager that spun out of the bankruptcy of Caesars Entertainment.

VICI currently owns 27 casinos, hotels, and racetracks, and four golf courses. It makes money by collecting rent checks from operators who don't own the properties themselves.

The REIT currently pays a 5.49% dividend and will continue to benefit from lower interest rates in the future.

Its CFO recently purchased more than $227,000 in company shares. This the latest sign that leaders anticipate a rebound in prices in the near future.

Action to Take: Buy TROW, CATO, and VICI for their solid balance sheets and reliable dividend yields. Each company should be able to weather the coronavirus volatility relatively easily. In the long run, you will be thanking yourself you bought these stocks and didn't panic-sell like many investors are doing now.

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About the Author

Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.

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