of S&P500 is at an all-time high, ushering in a new bull market. With stock prices rising, now is a great time to buy stocks, and a mix of high-dividend stocks is at the core of many good stock portfolios. real estate income (New York Stock Exchange: O), home depot (New York Stock Exchange: HD)and Starbucks (NASDAQ:SBUX) are three great options to consider now.
1. Real estate income: secure monthly income
Realty Income offers everything dividend investors want, including high yields and reliable dividend growth. It also has features that most dividend stocks don't have. It is paid monthly.
As a real estate investment trust (REIT), 90% of its profits are paid out as dividends. REITs rent out the real estate they own to tenants, usually for several years, providing a strong source of recurring income. Dividend investors should include some REITs in their portfolio, and real estate income is a sure bet.
However, not all REITs are the same. They work in a variety of industries, some with higher risks than others. Realty Income is a retail REIT, meaning it leases real estate to retailers. The top 20 tenants are names that are well known and likely to be used frequently. CVS, dollar generaland walmart. These are established and growing industry leaders and cash-rich. That means you can pay your rent.
Realty Income is in growth mode, acquiring other REITs to expand and diversify its property count. It nearly doubled when it acquired VEREIT in 2021, and just completed its acquisition of Spritit last week, adding another 2,000 properties. Today, that number totals over 13,000.
The company has paid a monthly dividend for more than 53 years and has provided investors with 105 consecutive quarterly increases. The dividend yield at the current price is 5.6%.
The company's stock price has fallen 19% over the past year. But once inflation stabilizes and interest rates are lowered, REITs should grow. Now might be the perfect time to buy.
2. Home Depot: Consistent leader in home improvement stores
Home Depot is North America's largest home improvement company with more than 2,300 stores. We also have the highest sales and net profits in the industry.
It has not been an easy time in the current economic climate. Over the subsequent 12 months, revenue fell by 2% and earnings per share (EPS) fell by almost 7%. That was in line with leadership guidance. For the full fiscal year 2023, management expects conditions to deteriorate slightly.
There are several factors contributing to this performance, all of which are short-term headwinds. Customers are refraining from making large discretionary purchases in an inflationary environment. It has faced staggering growth since the early days of the pandemic, weighed down by pressure on real estate from high mortgage rates.
Once those pressures ease, Home Depot should have no problem returning to its normal growth pattern. The company's stock price has already risen on the good news about a potential rate cut, and its dividend yields 2.3% at current prices.
3. Starbucks: The world's largest coffee chain
Starbucks is currently the world's largest coffee shop, with about 38,600 stores and trailing 12-month revenue of $36 billion, but the company is looking to expand even further. The company's stores are focused on coffee, but collectively they approach the world's largest restaurant chain.
In the first quarter of fiscal 2024 (ending December 31, 2023), Starbucks announced several unexpected faced obstacles. Despite this, the company saw an 8% increase in revenue and a 5% increase in profits over the previous year. Earnings per share (EPS) increased 22% to $0.90, and operating margin improved from 14.4% last year to 15.8% this year.
Management explains how it is countering slowing demand from transient U.S. consumers by offering targeted loyalty program incentives, with membership growth 13% year-over-year Increased. Loyalty programs are a strong growth driver, and converting more customers to the program should lead to increased sales.
Starbucks stock has fallen 13% over the past year, and at this price the dividend yield is 2.4%. As it gains loyal members and customers return to higher discretionary spending, Starbucks should enjoy years of growth and profits.
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Jennifer Cybill has no position in any stocks mentioned. The Motley Fool has positions in and recommends Home Depot, Realty Income, Starbucks, and Walmart. The Motley Fool recommends his CVS Health. The Motley Fool has a disclosure policy.
“3 Dividend Stocks to Double Up on Right Now” was originally published by The Motley Fool.
