Investing in profitable companies when their stock prices provide high returns can be very rewarding in the long run. If you have a few hundred dollars that you don’t need to reduce debt or cover other living expenses, there are solid companies with attractive offers. Dividend returns now.
Real estate income (NYSE:O), goal (NYSE: TGT)and Philip Morris International (NYSE: M) It has much higher dividend yields Standard & Poor’s 500 Average 1.24%. That’s why three Fool.com contributors think they’re smart buys for 2025 and beyond.
Jennifer Seibel (real estate income): Realty Income is one of the best stocks to own at any time, but 2025 could be a big year for the real estate industry overall, and Realty Income’s business could be stronger than usual.
Realty Income is a real estate investment trust (REIT). This is a structure in which companies pay out 90% of their profits as dividends, which is why REITs are great dividend stocks. The typical situation is that they own properties and rent them out, usually to a specific sector. Realty Income is a retail real estate investment trust that leases properties to retail chains such as… Walmart and Home Depot.
Since it rents mostly to high-quality tenants selling necessities, it has shown resilience over the past five years, starting with the pandemic and ending with the recent poor real estate climate. The occupancy rate is 98.7%, and it rarely drops below that.
It has become one of the largest REITs in the world with more than 15,000 properties, and is growing through a combination of buying new properties and acquiring smaller REITs. It has a comfortable cash position to maintain and has set plenty of new goals to expand and fund its dividend.
There are several reasons why Realty Income is one of the best REITs out there. One is the strength of its actions. Great dividend stocks start with an established business. Other features to add on top of this are a long history of raises, reliable payouts and a high return.
Realty Income has paid a dividend for 654 consecutive months, and has raised it for 109 consecutive quarters. It’s one of the few companies that pays a monthly dividend, which is an added feature that makes it even more attractive. Dividend yields are 5.9% at the current price, which is well above the S&P 500 average, and higher than many REITs.
Often times, when a REIT’s dividend yield becomes too high, it is a red flag and comes with risks. Realty Income stock has fallen on consumer pessimism about the real estate industry, but it is managing effectively through the turmoil. The yield is usually high, but is higher than average due to short-term concerns. This is more of an opportunity to buy the dip, which investors should not miss. It’s an opportunity to buy premium all-weather stock that pays rain or shine with high yields, and every month to boot.
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