Yields on cash are going to tumble as interest rates drop. Dividend-paying stocks provide an opportunity for income, the firm said.
The Federal Reserve could begin cutting rates as early as September — and income investors would do well to snap up dividend-paying stocks that offer solid yields. Fed funds futures pricing suggests a 100% likelihood that the central bank will ease on interest rates at next month's meeting, according to CME FedWatch . Economists at Bank of America see the Fed dialing back its target rate – currently at a range of 5.25%-5.5% – to 3.25%-3.5% in mid-2026.
Bank of America analyst Wamsi Mohan reiterated his buy rating on the stock at the end of July following meetings with Seagate's management. "We walked away bullish on the potential for this cycle to shape out with lower peaks and lower troughs ," Mohan wrote in a July 31 report. The analyst called out the potential for "slow and steady pricing increases" and gross margins that are above previous peaks in the meantime.
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