If you are looking for a steady income, you will not gain much by putting your cash in a money market fund. Lower interest rates have also kept bond yields much lower.
There is an option that can give you more attractive yields – dividend stocks. Of course, not every share that pays dividends is a smart pick. Here are three dividend stocks with yields of over 3% that seem great candidates to buy right now.
1. Brookfield Infrastructure Partners
Brookfield Infrastructure Partners (NYSE: BIP) Offers a juicy dividend yield of 3.8%. Its yield has not decreased below 3.5%.
One important reason why Brookfield Infrastructure Partners’ dividend track record is so impressive is: its business is remarkably stable. The company, as its name indicates, owns infrastructure assets. These assets – including cell towers, data centers, pipelines, ports, railroads, and toll roads – generate consistent cash flow month in and month out.
This stable business model gives Brookfield Infrastructure a good safety cushion during challenging economic periods. During the COVID-19 epidemic, the company’s financial performance was not affected at all. Brookfield Infrastructure Partners also holds tremendous growth potential, which the company calls the “Infrastructure Investment Super Cycle”.
Brookfield Infrastructure Partners is a limited partnership (LP), which can complicate your taxes somewhat. Can also invest in Brookfield Infrastructure Corporation (NYSE: BIPC), Which is the same underlying business but is organized as a traditional corporation to avoid any tax issues. Although the related stock pays the same dividend as LP, its yield is less than 3% due to the lower share price.
2. Brookfield Renewable Partners
There is another stock related to Brookfield Infrastructure Partners that income-seeking investors might like: Brookfield Renewable Partners (NYSE: BEP). Its dividend yield is currently close to 3.3% and has never gone below 3%.
Brookfield Renewable and Brookfield Infrastructure are both managed by the same general partner, hence their similar name. However, Brookfield Renewable Partners focuses on renewable energy. It operates hydroelectric, solar and wind power generation facilities around the world.
Renewable energy is enjoying more demand than ever before. Major countries have set ambitious targets for carbon reduction. President-Elect Joe Biden wants to put the American economy on a path to reach 100% clean energy use by 2050. Brookfield is in a position to benefit from renewable partner green wave.
As you can guess from its name, Brookfield Renewable Partners is also an LP. Can also buy shares of Brookfield Renewable Corporation (NYSE: BEPC), But its yield is less than 3%.
3. Innovative Industrial Properties
Innovative Industrial Properties (NYSE: IIPR) Provides a way to obtain a steady income from another type of green wave. It is a real estate investment trust (REIT) focused on the US medical cannabis industry. The dividend of IIP is currently slightly over 3%.
If you don’t know it, the medical cannabis market in the US is booming. IIP’s Q3 results show: The company posted revenue that is nearly three times higher in the year. Its adjusted funding from operations (a peak profitability metric for REITs) is also nearly three times that.
The business model of IIP is straightforward. The company buys assets from medical cannabis operators. It then returns those assets to the operators. Both sides win, with IIP receiving solid recurring revenue and its tenants receiving much-needed capital.
You probably won’t have to worry too much about the IIP dividend falling; It has increased 680% since 2017. IIP owns property in 16 states, but medical cannabis is legal in another 19 states where the company does not have a presence. This gives cannabis-focused REITs ample opportunities to move forward for a long time to come.