Three Dividend-Malgingering Equities That Retirees Can Bank on for Consistent Revenue Income
If you're a senior citizen searching for reliable sources of income, high-dividend stocks might be your ticket to maximizing your funds. Although the typical S&P 500 stock offers an average return of 1.2%, there are numerous options with significantly higher yields and minimal risk to include in your portfolio.
For retirees, three well-established stocks that could be beneficial additions to your portfolio are Bristol Myers Squibb (BMY, 0.51%), Enbridge (ENB, 0.80%), and Coca-Cola (KO, -0.65%). These dividend stocks will also contribute to diversifying your portfolio, providing exposure to various sectors of the economy.
1. Bristol Myers Squibb
With a current yield of 4.5%, drugmaker Bristol Myers offers an appealing dividend. Its stability as an investment makes this a low-risk addition to any portfolio. Over the past five years, the stock's volatility, as indicated by its beta, has averaged 0.44. Although it may not result in rapid gains, it's an excellent approach to generating constant income while safeguarding your capital.
Despite losing patent protection for several drugs this decade, investor enthusiasm for Bristol Myers has waned. On a positive note, the company has been developing new drugs. The U.S. regulatory authorities recently approved the schizophrenia drug, Cobenfy, which has the potential to become a blockbuster, with some analysts estimating sales could peak at $7.5 billion. The company also boasts an impressive pipeline, with 51 compounds in development and studies into more than 50 disease areas.
Bristol Myers' dividend is robust, given that the company generated $13.8 billion in free cash flow during the preceding 12 months, of which $4.8 billion was paid out as dividends. Recently, the company increased its dividend by 3%, extending its dividend growth streak to 16 consecutive years.
The company's financials are strong, its dividend is appealing, and its continued innovation make Bristol Myers a compelling stock to purchase at present.
2. Enbridge
A prominent oil and gas stock to consider for your retirement portfolio is Enbridge. The Canadian pipeline company's current dividend yield is 6.4%, the highest among the listed stocks. Early this month, the company announced a 3% dividend increase, marking the 30th consecutive year Enbridge has boosted its payout.
The company benefits from long-term contracts, ensuring predictability in its earnings. Additionally, management expects solid single-digit growth (between 7% and 9%) in earnings before interest, taxes, depreciation, and amortization (EBITDA) until 2026. This year, Enbridge acquired several U.S. gas utilities, which can further drive efficiency and growth.
As a prominent player in North America's oil and gas industry, Enbridge can be a secure stock for seniors to maintain as part of their portfolios.
3. Coca-Cola
The safest stock on this list might be Coca-Cola. The iconic beverage company boasts a diverse portfolio of renowned brands, such as Coca-Cola, Sprite, and Fanta, among others. The company's profit margins of over 20% put it in an advantageous position to invest and grow for the long term, while simultaneously allocating funds to dividends — a practice it has been consistently engaged in for decades.
The stock's dividend growth streak spans 62 consecutive years, and its latest increase was an attractive 5.4%. The company boasts a current yield of 3.1%, making it a viable option for retirees seeking reliable recurring income.
Coca-Cola has managed to adapt to fluctuating economic circumstances and has exhibited strong pricing power due to its strong brand portfolio. This adaptability and power make it an ideal long-term investment for retirees, making it an excellent buy-and-hold choice.
- For those interested in investing, Coca-Cola's high dividend yield of 3.1% makes it an attractive option. This reliable income source, coupled with the company's brand strength and adaptability, makes Coca-Cola a solid choice for long-term finance planning.
- Enbridge's 6.4% dividend yield is not the only appeal of this oil and gas stock. Its long-term contracts provide predictable earnings and management's expectation of solid single-digit EBITDA growth until 2026, along with its consistent dividend increases, make Enbridge a secure and profitable investment for individuals focusing on finance and money management.
