Morgan Stanley's quant screen chooses dividend stocks to own and avoid
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Morgan Stanley ran a quantitative screen based on analyst research to identify best risk and reward among dividend-paying stocks.
"This methodology compares upside/downside to price target, projected dividend yields, and bull-bear spread, and 1-year volatility to optimize risk and return metrics," Nicholas Lentini and team wrote in a note. "We then ran the final 'To Own' and 'To Avoid' stocks by our coverage analysts as a fundamental overlay."
The lists "represent the top and bottom two deciles of total return (PT upside + dividend yield) stocks as ranked by our model," he said.
The systematic top dividend stocks to own are:

Eastman Chemical (EMN), dividend yield 3%, total expected return 77%
LyondellBasell (LYB), 9%, 41%
Linde (LIN), 2%, 29%
Air Products and Chemicals (APD), 3%, 30%
Public Service Enterprise (PEG), 3%, 25%
FirstEnergy (FE), 4%, 36%
Vistra (VST), 3%, 35%
AES (AES), 3%, 27%
Crown Holdings (CCK), 1%, 42%
Visa (V), 1%, 44%
MasterCard (MA), 1%, 38%
AT&T (T), 6%, 29%
AbbVie (ABBV), 4%, 42%
Royalty Pharma (RPRX), 2%, 20%
Yum! Brands (YUM), 2%, 29%
Wells Fargo (WFC), 3%, 44%
Citizens Financial Group (CFG), 5%, 41%
Regions Financial (RF), 4%, 31%
Ross Stores (ROST), 1%, 37%
TJX (TJX), 2%, 24%
Ferrari (RACE), 1%, 51%
Energy Transfer (ET), 11%, 34%
Western Midstream (WES), 8%, 31%
Plains All American (PAA), 8%, 30%
Philip Morris (PM), 5%, 21%
Invitation Homes (INVH), 2%, 23%
Raytheon (RTX), 2%, 35%
Diamondback Energy (FANG), 9%, 36%
Microchip Technology (MCHP), 3%, 27%
Primoris Services (PRIM), 1%, 55%
Nike (NKE), 1%, 39%
Comcast (CMCSA), 3%, 39%
Microsoft (MSFT), 1%, 33%
CDW (CDW), 1%, 28%
Zoetis (ZTS), 1%, 66%

The stocks to avoid are:

Consolidated Edison (ED), 3%, -11%
Southern (SO), 4%, -8%
Caterpillar (CAT), 3%, -23%
Lumen Technologies (LUMN), 2%, -9%
Lazard (LAZ), 5%, -13%
American Eagle (AEO), 4%, -28%
Kohl's (KSS), 5%, -30%
Urban Edge (UE), 4%, -9%
Lithia Motors (LAD), 1%, -20%
Penske Automotive (PAG), 2%, -22%
Group 1 Automotive (GPI), 1%, -23%
Sonic Automotive (SAH), 2%, -40%
FactSet (FDS), 1%, -23%
Brown-Forman (BF.B), 1%, -12%
Watsco (WSO), 3%, -26%
eBay (EBAY), 2%, -15%
UPS (UPS), 3%, -23%

See the Credit Suisse "Top of the Crop" list.