When a stock’s 50-day moving average (MA) crosses above its 200-day MA, that’s considered a golden cross and is a bullish indicator. That can lead to more buying momentum and send shares of a company even higher as technical analysts jump onto the bandwagon.
One dividend stock that recently made that cross over was Philip Morris International (NYSE:PM). The tobacco giant’s shares are at a 50-day MA of just over 100, which is slightly above its 200-day MA, which is just under 99. The defensive stock has been one of the safer buys this year, as it is up around 13%, while the S&P 500 is down by about that amount.
Phillips Morris also pays an attractive dividend yield of 4.6%. The higher the price goes, the lower that yield gets, and so there’s definitely some incentive for investors who are bullish on the stock to buy it before it climbs much higher. Plus, the stock is still relatively cheap; Phillip Morris currently trades at 18.5 times its earnings, which is cheap compared to Altria Group (NYSE:MO) – its earnings multiple is at more than 33.
Over the years, Phillips Morris has been a fairly stable investment to hang on to, with its sales falling between $28 billion and $32 billion over the past five years. Even in 2020, during the pandemic, sales dropped by a modest 3.7%. The company’s profit margins are routinely above 24% of revenue.
As investors continue to flock to safe investments amid this downturn in the markets, Phillips Morris could rise higher and be one of the safer stocks to be holding right now.
