January 2023 Dividend Stock Watch List

As I'm writing this blog post on Saturday, December 10th, it's currently 32 degrees Fahrenheit here in Central Wisconsin. With the official start of winter less than two weeks away, that's a pretty decent temperature for this area.

With that aside, it's never too early to look ahead to next month. Here are three dividend stocks that I plan on buying, unless they experience massive rallies between now and then.

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Dividend Stock #1: Dollar General (DG)

The first dividend stock on my watch list in January is Dollar General (DG). Interested readers can check out my Motley Fool article on the stock from September for my investment thesis. 

As massive as DG is, there's still plenty of room for future earnings growth. And on top of that earnings growth, the payout ratio is quite low. This makes up for the stock's starting yield of 0.9%. Topping it all off, DG is a decent value at the current $243 share price (as of December 10, 2022).

Dividend Stock #2: American Electric Power (AEP)

The next dividend stock on my watch list next month is American Electric Power (AEP). Readers looking for my investment thesis on the stock (and on Philip Morris International and Enterprise Products Partners) can take a look at my Motley Fool article from June.

Basically, everybody needs electricity. And AEP is one of the most dominant electric utilities in the industry. The stock offers a compelling 3.4% dividend yield that is also well-covered. And AEP isn't unreasonably valued at the current $97 share price (as of December 10, 2022).

Dividend Stock #3: Main Street Capital (MAIN)

The third dividend stock on my watch list for January is Main Street Capital (MAIN). Readers inquiring for my investment thesis on the stock (and for Prudential Financial) can find it in this recent Motley Fool article.

Essentially, MAIN provides capital to underserved businesses in exchange for debt and/or equity. Due to the lack of competition in its space, MAIN does quite well for itself. The business is well-diversified and steadily growing over time. And the 7.4% dividend yield is quite safe by business development company standards. The cherry on top is that MAIN is also somewhat cheap at the current $37 share price (as of December 10, 2022).

Concluding Thoughts:

In just three weeks, December and the year of 2022 will be in the books! I'm looking forward to adding yet another high-quality stock in DG to my dividend growth stock portfolio to start off 2023. And I'm just as excited to be adding to positions that are already well-established in my portfolio.

Discussion:

Are any of DG, AEP, or MAIN on your watch list for January 2023?

If not, what stocks are you thinking about buying next month?

As usual, thanks for reading. Please feel free to comment below!