When it comes to stock investing while in retirement, dividend stocks tend to be some of best investments you can make. Not only do they tend to be less volatile stocks that help you preserve your nest egg, but they also throw off cash you can use to supplement your income without having to draw down on your principal.
So we asked three of our contributors to each highlight a dividend stock they think are great investments in a retirement portfolio. Here's why they picked Verizon Communications (NYSE:VZ), STAG Industrial (NYSE:STAG), and NextEra Energy (NYSE:NEE).
Source: Motley Fool
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Having a few trusty dividend stocks that you can approach with a "set it and forget it" mindset takes a lot of the stress out of investing, and such investments can play a key role in your efforts to craft a portfolio that delivers market-beating returns. Find out which companies could power your portfolio's returns for years to come...
For this dive into promising income-generating stocks, I'll be looking at three companies that have recently been making headlines for their strong performances. Two are technology giants that are benefiting from the growth of recurring revenue streams -- Cisco Systems (NASDAQ:CSCO) and Microsoft (NASDAQ:MSFT) -- and the other is an apparel stalwart on the rebound as one of its key lines is heating up -- Hanesbrands (NYSE:HBI).
Source: Motley Fool
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This company remains a top-notch income vehicle for DGI investors. The healthcare REIT has strong distribution coverage stats, and out-earned its dividend with AFFO in the last quarter. Industry fundamentals are intact. Shares are not cheap, but the valuation proposition is strong. An investment in the stock yields 4.9 percent.
Ventas Inc. (VTR) makes a compelling value proposition for investors that seek high-quality and recurring dividend income from one of the country's largest healthcare REITs. It has a diversified facility portfolio, very good distribution coverage, and the fundamentals in the healthcare sector (population growth, rising healthcare expenditures) remain intact. Shares are not a bargain anymore, but the risk/reward is still favorable, in my opinion.
Source: Seeking Alpha
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This company released fourth-quarter earnings recently. The mortgage REIT once again covered its dividend payout with core earnings. Shares remain reasonably valued based on run-rate core earnings and accounting book value. An investment in the stock yields 10.8 percent.
Chimera Investment Corporation (CIM) released fourth-quarter results last week that continue to support the investment thesis for high-yield investors that seek to capture high, recurring dividend income from this mortgage REIT. Chimera Investment Corp. continued to outearn its going dividend rate with core earnings in the fourth quarter, and shares remain moderately valued on a run-rate core earnings and book value basis.
Source: Seeking Alpha
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A sizeable part of portfolio returns can be produced by dividend stocks due to their contribution to compounding returns in the long run. Baker Hughes, a GE company (NYSE:BHGE) has started paying a dividend to shareholders. It currently trades on a yield of 2.7%. Let’s dig deeper into whether Baker Hughes a GE should have a place in your portfolio.
Baker Hughes a GE has a trailing twelve-month payout ratio of 158%, meaning the dividend is not sufficiently covered by its earnings. However, going forward, analysts expect BHGE’s payout to fall into a more sustainable range of 29% of its earnings. Assuming a constant share price, this equates to a dividend yield of 2.8%. Furthermore, EPS should increase to $1.1, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.
Source: Simply Wall St.
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