When stock market volatility drives me crazy, I find solace in dividend shares. Or instead, I take comfort in the top dividend shares that I know I will have to pay a decent amount of, no matter what the market. And while some of this is nothing like acquiring top-class dividend-paying stocks, they are still playing high yields and lagging ahead in the broader market despite visible growth catalysts. Here are three such stocks that have attracted my attention of late.
All retail is not down in the dump
Realty income (NYSE: O) The stock is down nearly 12% year to date. With a dividend yield of 4.3%, I find this an attractive entry point.
With the shuttering of retail businesses following the coronovirus disease (COVID-19) lockdown, the realty income business was bound to be a hit. Most of its tenants, after all, operate retail stores.
Yet the nature of these tenants, their sheer number and style of realty income have saved the company from bad shocks. Where is the proof? In August, Realty Income collected rent from 87.8% to 93.5% in June.
You see, the majority of realty income tenants are in nonfamily businesses that enjoy flexible demand. Think dollar stores, convenience stores and drug stores. Its five largest tenants are today Walgreens, 7 Eleven, Dollar General, Fedex, And dollar Tree. Realty Income has around 600 tenants in total, making it a high quality diversified portfolio.
Another important reason for realty income is that it is a real estate investment trust because of the storm, it means that it buys commercial properties and leases them. These are long-term leases, typically lasting 10 to 20 years. They are also all triple-net leases, meaning tenants cover costs such as maintenance and insurance, while realty income simply collects rent. They also have built-in annual rent escalators. Historically, the same shop rental income of realty income has increased from 1% to 1.5% every year.
It is a fixed business model to generate steady revenue, and realty income also promotes growth through new asset acquisitions. For 2020, management is targeting acquisitions of $ 1.25 billion to $ 1.75 billion.
Here’s what I like most: the fact that the anticipated monthly lease payment collects realty income can easily support monthly dividends. Yes, realty income cuts you monthly check and its dividend has increased every year since it went public in 1984. With the economy reopening, I like where realty income is placed today.
A 10%-Excellent Energy Stock? tell me
With oil and gas stocks declining this year in the oil market, it is no surprise Enterprise Product Partners (NYSE: EPD) The shares have shed nearly 39% year to date as of this writing, raising its dividend yield to 10.2%.
I can generally maintain my distance from an oil stock with a sky-high yield today, but enterprise product partners dividend looks safe, especially after the decision by Midstream Energy Company to cancel its M2E4 pipeline project The latter which do not warrant additional pipeline capacity under current circumstances.
With the project now canceled, the enterprise hopes to reduce its projected growth capital expenditure to $ 800 million through 2022. The company will use that money in the form of debt repurchases instead of debt and rewarding shareholders. The timing could not be better. Although management did not mention dividends, it is highly likely to offer shareholders an increase in dividends this year, even if it is only a small one, to maintain its annual dividend growth track record of more than 20 years .
The potential dividend growth, 10% -additional yield, strong financials, and a mostly fee-based business that largely protects the company from oil price fluctuations have really caught my attention on this energy dividend stock.
I see a low priced coronovirus stock here
Would you consider buying a healthcare stock that is already pushing its COVID-19 vaccine candidate for Phase 3 trials, but is barely green yet this year? What if I also tell you that this is not a run-of-the-mill company, but with a rich 130-year history and top brands in consumer health, pharmaceuticals, and medical devices under its belt? Oh, and there is also a dividend king of this stock, who has increased his dividend every year for more than 50 consecutive years?
Sounds seductive, doesn’t it? This is why Johnson and johnson (NYSE: JNJ) For you – a dividend stock I will now heap for years to come.
Under current circumstances, the speed with which Johnson & Johnson is in the race to produce the coronovirus vaccine would be reason enough for many to buy the stock. It is set to begin Phase 3 testing by the end of September. But there are many other compelling catalysts that make the company difficult to ignore.
Highly diversified portfolio with 26 products or brands that make at least $ 1 billion in annual sales, a formidable biotech pipeline, and an impeccable record of free cash flow and dividend growth over decades, topping Johnson & Johnson in earnings They deliver. Investors. And don’t forget the aggression with which the company is developing: it’s about to take over Momenta Pharmaceuticals (NASDAQ: MNTA) To take a major lead in immunology for $ 6.5 billion.
With 58 years of dividend increase and a 2.7% yield to boot, I think Johnson & Johnson’s stock will go places when bought today.