Category Monthly Dividend

Dollar Tree may be a “dark horse” beneficiary of widespread tariffs, Citi analysts said Monday while upgrading the discount retailer’s stock.

With import taxes slated to affect nearly all U.S. trade partners, Dollar Tree (DLTR) will have cover to raise prices without deterring too many customers, the bank wrote in a research note. Dollar Tree performed well during prior downturns and has cultivated a reputation for offering value, which analysts said will serve the chain well.

Citi upgraded its rating to “buy” from “neutral” and gave Dollar Tree a target price of $103. That’s more than 52% above where shares closed Friday and about 25% higher than the consensus price target among analysts who follow the company and are polled by Visible Alpha.

“We believe this higher-tariff-across-the-board environment is going to be a positive for [Dollar Tree],” the note said. “We think that [Dollar Tree] has cover to increase their base price in this environment with everyone else also increasing prices.”

Citi Analysts Think Tariffs Will Hit Rivals Harder

About half of Dollar Tree’s products will be subject to import taxes under the “reciprocal” tariffs unveiled by the White House last week, Citi estimated. But the tariffs affect so many nations that many of the discount retailer’s rivals will also be paying—and charging—more for merchandise, the analysts said.

Customers accepted Dollar Tree moving away from a “base” item price point of $1 when freight costs shot up in 2022, Citi said. Current trade policies may get the chain to a $1.50 or $1.75 price point, analysts added.

“We believe the current environment is ideal for [Dollar Tree’s] value proposition to thrive,” the note said.

Dollar Tree shares rose nearly 8% in trading Monday. Still, the shares are more than 40% below their levels seen a year ago.

Shares of Tesla Inc. (TSLA) have long confounded Elon Musk’s critics: while sales have collapsed in some key markets, retail investors remain remarkably devoted to the firm.

For example, after news broke that Tesla’s European sales had plummeted 40% year-over-year in January 2025, even as the wider electric vehicle (EV) market grew 26%, retail investors poured $7.3 billion into Tesla stock over the next 12 days, the most of any “buying streak” over a decade, according to JPMorgan’s “Retail Radar.”

The report suggested this was more money chasing after bad: Noting that Tesla’s retail investors were down 7% in the year to date versus 3.3% for the broader S&P 500 index, JPMorgan analysts pointed out, “Most of the drawdown came…as they increased their holdings.”

What gives? “Core investors” have an “undying faith in and love of Elon Musk,” Steve Sosnick, chief strategist at Interactive Brokers, told Investopedia. “In fact, I’ve frequently referred to it as a ‘faith-based’ stock.” But, he added, “that faith is well-earned after making many long-term investors quite rich.”

It’s Not About Tesla’s Past or Present, But Its Future

“Tesla’s electric vehicle business is under pressure from pricing challenges and fierce competition, with 2024 marking its first-ever annual delivery decline,” John Blank, chief equity strategist at Zacks Investment Research, told Investopedia. “Musk’s divided attention and growing political controversies have investors questioning whether Tesla is still his top priority.”

However, it’s Tesla’s long-term prospects that count most. “Musk wants the company to be primarily viewed through the lens of AI and robotics rather than solely as an automotive company,” Blank said.

Among the CEOs of automakers, “only Musk is perceived as an avatar of the future,” Sosnick said.

Hence, investors’ “faith is based less on corporate fundamentals than futurism—robotaxis, etc.—which is why the stock’s valuation is way above that of a conventional auto company,” Sosnick said. “Thus, if you’ve already decided that the stock is all about the future, you can overlook some pesky details about the present.”

That’s borne out in interviews. “To be honest, I’m not a huge fan of Tesla’s EVs,” a retail investor who snapped up more shares of TSLA as its price fell in March 2025 told Business Insider. “My bullish outlook is more on the AI and autonomous side of the business.”

Tesla’s Next Chapter

Instead of the usual “dumb money” derision one might expect, analysts we spoke to don’t think these investors are irrationally following market sentiment.

For several years, Tesla has been making a strategic pivot beyond its core automotive business. “Tesla’s long-term growth prospects still remain strong, driven by its thriving energy generation and storage segment, expansive supercharger network, and AI advancements,” Blank said. The company is sitting on a massive cash pile to help make that happen—about $37 billion at year-end 2024.

“Pretty much all” of Tesla’s market cap is based upon future expectations, and that has always been the case, Sosnick said, noting that General Motors Company (GM), Ford Motor Co. (F), and other automakers all have single-digit price-to-earnings ratios, which means investors are valuing them based almost wholly on where they are now, not where they are likely to be in the future.

For core investors, the numbers are compelling: While automotive operations still accounted for 78.9% of Tesla’s total sales in 2024, its Energy Generation/Storage segment showed remarkable growth, with revenues rocketing 113% year over year in the fourth quarter and its energy storage deployment reaching 11 gigawatt-hours, Blank noted. In addition, “the charging business has the potential to evolve into a substantial revenue stream for the company,” he said, especially as major automakers are forced to adopt Tesla’s charging standard.

However, major challenges remain. Sales of the Cybertruck, launched in 2024, sputtered and the vehicles were recalled for significant problems. In addition, most investors surveyed think Musk’s political activities have damaged the company—they’ve sparked mass protests and acts of vandalism against the EVs and dealerships worldwide. Meanwhile, General Motors, Ford, emerging players like Rivian Automotive, Inc. (RIVN) and Lucid Group, Inc. (LCID), and Chinese competitors like BYD are gaining ground fast as Tesla’s overseas sales drop precipitously.

The Bottom Line

The question is whether Tesla’s ambitious expansion into energy, AI, and autonomous driving can offset the significant challenges in its automotive business. Given the headwinds the company faces, the execution of this transformation becomes all the more crucial if the faith of retail investors is to be justified.

Unlike in President Donald Trump’s first administration, manufacturers may have no place to hide as widespread tariffs could disrupt global supply chains.

Trump’s tariffs unveiled last week that will be levied against imports from a long list of countries, including 34% on goods from China, 26% on India, and 20% on the European Union. Trump has said the goal of the tariffs is to reorder global trade and bring more manufacturing back to the U.S. However, economists think that instead of relocating to the U.S., manufacturers may just get tangled up in supply chain challenges.

“Broad tariffs across global trading partners, unlike prior narrower bilateral ones, limit the ability of the global trading system to adapt,” wrote Deutsche Bank economists and researchers. “This comes at the cost of fundamentally undermining global supply chain models that have emerged over the past several decades.”

Wide Range of Tariff Targets Leaves Little Room for Supply Chains to Adapt

After Trump first introduced tariffs on China during his first term in 2018, supply chains reoriented through countries like Mexico and Vietnam. However, Vietnam is now facing a 46% tariff under the new policy, and Mexico has already been hit with a 25% tariff on all goods not covered by the USMCA trade agreement.

Many manufacturers are also reluctant to move their operations to the U.S., where labor is often more costly than where they are currently producing their products. According to an Apollo analysis, the typical U.S. manufacturing worker earns nearly $6,000 a month, while their counterpart in China makes just over $1,100, and an Indian manufacturing worker only makes around $195.

That means importers have few options to avoid the tax this time around.

“If the U.S. imposes high tariffs on Mexico, China, India and the European Union, and cuts off aid to major resource economies in Africa, there isn’t much room left for the global supply chain to move,” said Vidya Mani, University of Virginia associate professor of business administration, during an interview on the school’s website.

Supply Chain Changes Could Be Costly for Companies

Some industries will be impacted by supply chain disruptions more than others; apparel and automobiles are particularly susceptible to trade disputes. In some cases, it will be more cost-effective for companies to pay the tariffs than relocate their production, Mani said. 

“Changing the supply chain in response to high tariffs is a massive undertaking and lasts beyond any one administration,” Mani said.

And while some of the tariff costs will be passed onto consumers, it’s also likely that profit margins will drop for corporations that import into the U.S. 

“We will be paying close attention to where sales are generated and the level of cross-border trade within companies to establish how they might be affected,” wrote Janus Henderson fixed-income portfolio managers Brent Olson and Tim Winstone.

The major U.S. equity indexes were lower at midday Monday, extending last week’s losses as the Trump administration showed no signs of pulling back from sweeping reciprocal tariffs. The Dow Jones Industrial Average, S&P 500, and Nasdaq all lost ground.

Tesla (TSLA) shares tumbled as the tariff-fueled selloff continued, and Wedbush analysts led by bull Dan Ives cut their price target for the stock to $315 from $550 previously.

Nike (NKE) shares fell amid worries that its key manufacturing partners in Vietnam, Cambodia, China and Indonesia would face punishing tariffs. 

Goldman Sachs (GS) shares also dropped after Morgan Stanley analysts downgraded the bank to “equal-weight” from “overweight,” citing the Wall Street bank’s large exposure to investment bank revenues amid rising recession risks and “deteriorating market conditions.”

Dollar Tree (DLTR) shares soared as Citi analysts upgraded the stock to a “buy” on the discount-retail chain’s potential to raise prices in the new tariff environment.

Mesa Air Group (MESA) soared after the carrier agreed to merge with fellow regional carrier Republic Airways in an all-stock transaction.

U.S. Steel (X) shares jumped as President Trump announced his administration would undertake a new review of the company’s merger with Nippon Steel.

Oil and gold futures sank. The yield on the 10-year Treasury note edged higher. The U.S. dollar gained ground against the euro and yen but fell against the pound. Prices for most major cryptocurrencies fell.

Stocks have been hit hard. That’s cut into the wealth of a broad swath of Americans. 

More than 60% of Americans have money in the market, according to Gallup data from May, up from a bit above 50% in the middle of the last decade. That reflects comparatively large holdings among those with annual incomes at or above $100,000—but Gallup also found that about two-thirds of middle-income Americans, and a quarter of those with annual incomes below $40,000, were invested through some combination of stocks or funds. 

That tracked with data released in late 2023 by the Federal Reserve, which found that more than a third of families in the bottom half of the U.S. income distribution held stock—along with more than three-quarters of the upper-to-middle income group and 95% of the top decile.

Last’s week’s dramatic and downbeat market response to the Trump administration’s latest announcement on tariffs has led many investors, from Wall Street to Main Street, to wrestle with how to respond as they’ve seen their portfolios shrink.

A steep two-day drop-off left some waiting for the market to change direction and others who expect the drubbings to continue; Monday morning, stocks have whipsawed. (Follow Investopedia’s live coverage of today’s markets here.) 

About a fifth of Americans who invest in stocks believe they have a “high” risk tolerance, according to YouGov data released Friday, while about 40% said they generally maintain their investments amid economic or market uncertainty.

“Your brain has identified a risk and it’s screaming at you to run away. It’s working as intended. Otherwise, I’d recommend you get your head checked,” wrote Callie Cox, chief investment strategist at Ritholtz Wealth Management, in an emailed commentary. “Honor your natural tendencies, but don’t listen to them. In many situations, touching the hot stove isn’t the best solution.”

JPMorgan Chase (JPM) CEO Jamie Dimon wrote in his annual letter to shareholders Monday that the Trump administration’s newly announced tariffs are likely to slow growth and raise prices.

“For the short-term, we are likely to see inflationary outcomes, not only on imported goods but on domestic prices, as input costs rise and demand increases on domestic products,” Dimon wrote. “How this plays out on different products will partially depend on their substitutability and price elasticity. Whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth.”

Dimon said that President Trump’s policy platform of “America First is fine, as long as it doesn’t end up being America alone.”

Negative Tariff Effects ‘Would Be Hard to Reverse’

The CEO also said that once the currently proposed tariffs are negotiated, he hopes there are long-term positive impacts for the U.S., like increased manufacturing. However, Dimon stressed the need to resolve the tariff issue quickly, “because some of the negative effects increase cumulatively over time and would be hard to reverse.”

Dimon and other banking executives are likely to give their first extended thoughts on tariffs and the current state of the economy on their first-quarter earnings calls. JPMorgan is slated to report its results Friday.

For more of the market’s reaction to the latest tariff news, check out Investopedia’s daily live markets coverage.

Banks are scaling back their 2025 outlooks for U.S. stocks as uncertainty about the economy and markets escalates.

The benchmark S&P 500 could slump to 4,700, a further 7%-8% decline from Friday’s close, if President Donald Trump sticks with his tariff plans or the Federal Reserve doesn’t ease interest rates, Morgan Stanley analysts wrote.

The analysts said they had offered a 5,100-5,200 technical support level for the S&P 500 last Thursday but noted that “with the market quickly trading there on Friday and overnight futures down another 3-5% so far, our thoughts turn to the next area of support, which lies closer to the 200-week moving average, or 4700.”

Oppenheimer analysts on Monday cut their target to 5950, about a 17% premium to Friday’s close, from 7100. Read Investopedia’s live coverage of today’s trading here.

“The equity market appears oversold in our view,” Oppenheimer’s analysts wrote, “with uncertainty at levels investors find hard to embrace along with what we call ‘a negative pitch book’ that seemingly projects negative outcomes to infinity that’s taken hold in the near term of trader, investor, and consumer sentiment. 

The index closed at 5,074.08 Friday, having suffered the seventh-worst week in the last 25 years, a decline of more than 9%. S&P futures are down 2.7% early Monday.

“Valuations also offer better support at that price so investors should be prepared for another 7-8% potential downside from Friday’s close if there is no line of sight to a less severe trade environment and the Fed remains firmly on hold,” Morgan Stanley’s analysts wrote.

Trump so far has shown no signs of backing down from the tariffs, while Fed officials have elected to keep their key interest rate steady. Fed Chair Jerome Powell said Friday that Trump’s larger-than-expected tariffs could stoke inflation and slow economic growth. 

This article has been updated to add context and the new Oppenheimer estimate.

Goldman Sachs analysts told clients Sunday they are cutting their forecast for gross domestic product (GDP) growth in 2025, and raising their recession risk forecast in response to the Trump administration’s new tariffs.

The analysts now put a 45% chance on a recession coming in the next year, up from 35% previously, due to a “sharp tightening in financial conditions, foreign consumer boycotts, and a continued spike in policy uncertainty that is likely to depress capital spending by more than we had previously assumed.”

However, that 45% is predicated on the effective tariff rate rising by 15 points, less than it’s currently expected to rise if the Trump administration’s tariffs announced last week go into effect on Wednesday. If most or all of those tariffs are enacted and the effective tariff rate rises by roughly 20 points, the analysts said the likelihood of a recession could rise above 50%.

The Goldman analysts lowered their GDP growth forecasts to 0.5% for the fourth quarter and 1.3% for 2025, down from 1% and 1.5%, respectively.

The analysts said they now expect the Federal Reserve to make three consecutive quarter-point rate cuts starting in June, a month earlier than they previously expected cuts to start. In a recession, they expect about 2 points in total cuts over the next year.

Stock futures were down sharply Monday morning, extending last week’s tariff-fueled selloff after the stock market had one of its worst weeks in years. (Read Investopedia’s live coverage of today’s market action here.)

Global stocks are slumping Monday, extending their rout, as President Donald Trump’s sweeping reciprocal tariffs and China’s retaliatory duties sparked a flight into haven assets and raised fears of a U.S. recession.

The Stoxx Europe 600 index is about 6% lower, while Japan’s Nikkei closed down almost 8%, and Hong Kong’s Hang Seng, where the biggest Chinese companies are listed, cratered 13%. Meanwhile, U.S. stock futures are tumbling, with those associated with the Dow Jones Industrial Average down 1,300 points, or 3.6%, Nasdaq futures 3.7% lower, and S&P 500 futures down 4%.

The flight from risk is driving up bonds and sending the 10-year Treasury yield down to 3.95%. Wall Street’s “fear gauge,” the VIX index of implied stock market volatility, is surging to its highest levels since the early days of the pandemic, while oil prices—already dealing with the prospect of increased supply—are plunging, with West Texas Intermediate futures down 4% at around $59.

The sharp selloff comes as Trump doubled down on his tariffs Sunday night, saying, “I don’t want anything to go down, but sometimes you have to take medicine to fix something,” according to reports.

Goldman Sachs raised its odds of a U.S. recession to 45% in the next 12 months from 35%, “following a sharp tightening in financial conditions, foreign consumer boycotts, and a continued spike in policy uncertainty that is likely to depress capital spending by more than we had previously assumed.”

Updated on April 1st, 2025 by Felix Martinez

Extendicare (EXETF) has two appealing investment characteristics:

#1: It is a high-yield stock based on its 3.9% dividend yield.
Related: List of 5%+ yielding stocks.
#2: It pays dividends monthly instead of quarterly.
Related: List of monthly dividend stocks

You can download our full Excel spreadsheet of all 76 monthly dividend stocks (along with metrics that matter, like dividend yield and payout ratio) by clicking on the link below:

A high dividend yield and a monthly dividend make Extendicare appealing to income-oriented investors. The company is also ideally positioned to benefit from the secular growth of demand for healthcare services. In this article, we will discuss Extendicare’s prospects.

Business Overview

Through its subsidiaries, Extendicare provides care and services for seniors in Canada. The company offers long-term care (LTC) services; home health care services, such as nursing care, occupational, physical, and speech therapy, assistance with daily activities, and contract and consulting services to third parties. It operates LTC homes, retirement communities, and home healthcare operations under the Extendicare, ParaMed, Extendicare Assist, and SGP Partner Network brands. The company was incorporated in 1968 and is based in Markham, Canada.

Extendicare operates or provides contract services to a network of 103 long-term care homes and retirement communities, providing approximately 11 million hours of home health care services annually.

Source: Investor Presentation

Extendicare has been hurt by the coronavirus crisis, which has caused many problems in the company’s daily operations. COVID-19, influenza, and other viruses have resulted in abnormally high employee absenteeism, thus exacerbating an already tight labor market. As a result, Extendicare has seen its operating costs increase significantly since the onset of the coronavirus crisis.

Growth Prospects

Extendicare is ideally positioned to benefit from a strong secular trend, namely the growing demand for healthcare services. The demand for health care from seniors who are above 85 years old is growing at a 4% average annual rate.

Source: Investor Presentation

Moreover, there is an immense backlog of demand for long-term care beds, with more than 48,000 seniors waiting for a bed in Ontario alone. According to official estimates, there will be a need for more than 200,000 new long-term care beds in Canada by 2035. Thanks to its 55 years of experience in this business, Extendicare is ideally poised to benefit from the secular growth in the demand for health care services.

On the other hand, investors should be aware that Extendicare has exhibited a volatile performance record. Due to the aforementioned impact of the pandemic on its business, the company has not grown its earnings per share over the last decade. Therefore, the stock is suitable only for patient investors, who can endure extended periods of poor business performance and stock price volatility and remain focused in the long run. Given the low comparison base formed this year, we expect the company to grow its earnings per share by about 5.0% per year on average over the next five years.

Dividend & Valuation Analysis

Extendicare currently offers a 3.9% dividend yield. It is thus an interesting candidate for income-oriented investors, but the latter should be aware that the dividend may fluctuate significantly over time due to the fluctuation of the exchange rates between the Canadian dollar and the USD.

The company has a decent payout ratio of 68%. To cut a long story short, the 3.9% dividend will not likely be cut soon, but given the company’s material interest expense, it is not entirely safe in the long run.

Regarding the valuation, Extendicare is trading for 12.9 times its earnings per share in the last 12 months. We assume a fair price-to-earnings ratio of 10.0 for the stock. Therefore, the current earnings multiple is higher than our assumed fair price-to-earnings ratio. If the stock trades at its fair valuation level in five years, it will have a -2.2 % annualized compression for the next five years.

Taking into account the 5% annual growth of earnings per share, the 3.9% dividend, and a -3.5% annualized compression of valuation level, Extendicare could offer a 5.4% average annual total return over the next five years. This is certainly a fair expected return. Nevertheless, the stock is suitable only for patient investors who are comfortable with Extendicare’s volatile business performance and stock price.

Final Thoughts

Extendicare has a solid business model and greatly benefits from the growing demand for healthcare services. The stock offers an attractive dividend yield of 3.9% with a healthy payout ratio of 68%, making it an attractive candidate for income-oriented investors’ portfolios. The stock has an expected return of 5.4% per year over the next five years.

On the other hand, investors should be aware of the risk resulting from the company’s somewhat weak balance sheet and its choppy business performance. Therefore, the stock is suitable only for patient investors, who can ignore stock price volatility and remain focused in the long run.

Moreover, Extendicare is characterized by exceptionally low trading volume. This means that it is hard to establish or sell a large position in this stock.

Don’t miss the resources below for more monthly dividend stock investing research.

And see the resources below for more compelling investment ideas for dividend growth stocks and/or high-yield investment securities.