Are These The Best Dividend Stocks To Buy Right Now?
If there’s one thing investors want in the stock market, it’s high yield dividend stocks that can produce a steady income stream that can sustain them throughout their life. When you think about dividend stocks, what comes to mind? Most likely, you’re thinking of some old, boring blue-chip stocks that barely move all year. As a result, it is not surprising that younger investors tend to stay away from these investments. Admittedly, these may be low-risk, low-return investments. But if you allocate a portion of your investments into top dividend stocks, you may be surprised at the calming effect that it brings to your portfolio.
When looking for the best dividend stocks, the yield isn’t everything. If you are an income investor in it for the long run, you know that steadily rising payouts are crucially important, too. After all, you wouldn’t want the target company to pay a 10% yield today and then say for example 2% in the following year. Therefore, if you manage to find a dividend stock with growing yields, it can be a valuable addition to your portfolio.
No doubt, investing in dividend stocks when growth stocks remain hot isn’t necessarily a wise thing to do. Especially when most attention is on Big Tech earnings this week. Yet, if you can find dividend stocks that can deliver above-average income and steady stock price appreciation, that may present a more attractive investment to some. Some of the bigger names out there with solid dividend yields are AT&T (NYSE: T) and Verizon Communications (NYSE: VZ). While some dividend stocks were hard hit by the coronavirus pandemic, others continue to rise. And they could continue rising higher. With that in mind, let’s focus on four dividend stocks that could manifest this growth.
Top Dividend Yield Stocks To Watch Now
- Realty Income (NYSE: O)
- AbbVie Inc. (NYSE: ABBV)
- Chevron Corp. (NYSE: CVX)
- Exxon Mobil Corp. (NYSE: XOM)
It’s one thing to get paid a dividend, but getting paid every month is even better, particularly if they have a high yield. Realty Income is one company that yields a dividend of 4.2% as of this writing. To those unfamiliar, Realty Income operates as a real estate investment trust (REIT). It leases its portfolio of thousands of commercial properties to notable clients globally. The company boasts some pretty big names under its belt, and that includes Home Depot (NYSE: HD), Walmart (NYSE: WMT), and FedEx (NYSE: FDX), all of whom have high credit ratings.
The REIT has delivered more than 600 quarters of continuous dividend payouts and raised dividends for more than 90 consecutive quarters. Despite the devastating effect brought by the coronavirus pandemic, the company’s shares are up around 30% over the past 12 months and 13% year to date. Perhaps some of the clients may have faced financial headwinds because of the pandemic. But Realty Income continues to get paid. Considering most of its long-term leases and tenants are all major corporations with high credit ratings, it’s hard to go wrong with O stock in my opinion.
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AbbVie is a biotech company that operates as a research-based pharmaceutical manufacturer. With over 47,000 employees around the globe, it continues to come up with new approaches to address today’s health issues. The company has a broad portfolio of treatments in the field of oncology, immunology, and neuroscience to name a few. The company has recently announced its fourth-quarter profit and revenue that managed to beat expectations. And more importantly, the company pays you well to own its stock. Abbvie’s dividend yield stands at approximately 4.7%.
That’s quite attractive for obvious reasons. But if the stock gains some momentum, that dividend will just be a big bonus to investors. However, there are a couple of issues that are holding the stock from skyrocketing. For one, the company’s top-selling drug Humira loses U.S. patent exclusivity in 2023. That means the company has to find an alternative drug to offset the anticipated sales decline. The delayed reviews of Rinvoq from FDA may deter some investors from diving right in. But the company remains confident about the prospects of FDA approval in treating atopic dermatitis and psoriatic arthritis. With all these in mind, do you have ABBV stock on your watchlist?
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Chevron Corporation is one of the leading integrated oil and gas companies in the United States. Many investors, including Warren Buffett, love CVX stock because it has a strong balance sheet and good growth prospects. After all, we are talking about a company with a history of 140 years. And more importantly, it has an attractive dividend yield of more than 5%. Sure, oil and gas stocks ain’t exactly the best investment in the stock market right now. But the company is keeping up with the times through its initiatives in hydrogen to support the green economy.
Notably, its recent partnership with Toyota Motor Corporation (NYSE: TM) to explore the production and commercialization of hydrogen is getting investors all excited. Of course, commercializing the hydrogen economy is not something that could happen in the near term. Nevertheless, the company does have a few tricks up its sleeves. In early April, it announced a deal to supply Japan’s Hokkaido Gas Co., Ltd. with about a half-million tons of liquefied natural gas over a period of five years starting April 2022. With such exciting developments, is CVX stock a good dividend stock to buy now?
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When looking for top dividend stocks, Exxon Mobil usually comes to mind. It is one of the largest oil and gas companies by market cap. For an oil giant with upstream and downstream services in the energy market, the recovery in oil prices has certainly helped with reassuring investors. XOM stock currently has a dividend yield of around 6%. It fits the bill as a long-time dividend distributor. Exxon proved its resilience by being one of the few O&G companies that did not suspend payout in 2020.
Like most oil and gas companies, Exxon had a rough 2020 as well. But the oil market has started to stabilize and XOM stock has recovered some lost ground. The company initially had planned huge capital investments in 2019 but was majorly disrupted by the pandemic. Since then, Exxon has made significant adjustments to its planned capital spending in the next 5 years. Extra cash flow would go towards debt reduction and dividend payment. The company appears to be heading in the right direction. And this should give investors in XOM stock some peace of mind, especially those that stuck out during its steep price drop last year.