Putting your money into dividend-paying stocks is a safe investment when the market takes a dip. People who buy dividend stocks can expect a steady, consistent stream of income that they can use to invest in more companies or cover those essential bills. At the same time, growth stocks, which provide much higher returns over time than most other investments, are trading at historical discounts.
Louis Navellier last week wrote that “safety and stability are cool again” and that pretty much sums up our choices today. They offer both solid income and capital gains growth, just what your portfolio needs in a market like we’re seeing these days.
Here are seven dividend stocks that are worth your investment capital as the long, hot summer sets in, inflation continues unabated and volatility seems to be a constant companion of retail investors:
Blackrock Municipal 2030 Target Term Trust
Main Street Capital Corporation
Pembina Pipeline Corporation
STAG Industrial, Inc.
LTC Properties, Inc.
Sabine Royalty Trust
Dynex Capital, Inc.
BlackRock Municipal 2030 Target Term Fund (BTT)
BlackRock Municipal 2030 Target Term Fund (NYSE:BTT) is designed to be liquidated in a few years. Investors who buy into this mutual fund early may get a good return on their money, such as municipal bonds trading at a discount to the net asset value. In the time between when you invest and when the mutual fund expires, a lot can happen with global economies. However, the stock price has shown remarkable stability across the worst of times.
BTT stock will invest at least 80% of its assets under management in municipal securities (635 as of March 31) that at the time of investment are investment grade quality. While those purchases are diversified, 25% or more could be in munis in the same state (or U.S. Territory) or in the same economic sector. Basically, the fund expects to $25 per common share to holders when the trust terminates, on Dec. 31, 2030, about the same time when the municipal obligations in the portfolio hit their final maturity.
It’s one of a myriad of funds marketed by BlackRock (NYSE:BLK), founded in 1988, is a leading investment firm and asset management company managing $10.01 trillion in assets. It has many institutional clients, including pension funds, governments, corporations, and insurance companies worldwide. BlackRock also offers its services to the retail market through its brokerage operation.
The monthly dividend is also a perk of owning shares of the company. The annual yield on the stock is 3.21%, and you can get it by buying shares at $23.17 per share.
Main Street Capital (MAIN)
Main Street Capital (NYSE:MAIN) offers a range of services for startups and midsize companies. They enable their clients to manage their portfolios, personal finance, payroll processing, etc.
Main Street Capital has been in the business since 2007. It provides loans, investments, capital, and other financial services to its clients.
They invest their time building partnerships with private capital sources before they put in money, which helps businesses grow or transition while also providing a good return on investment.
MAIN’s portfolio companies didn’t go well during the last two years. Many smaller firms were affected by pandemic-related lockdowns, minimizing their capacity. The company persevered, and by late 2021, its share price was back in full force.
As part of the dividend model, Main Street gives a modest monthly dividend to shareholders. It can issue special payouts twice per year. Keeping the dividend at a certain level is key to maintaining positive price momentum in a volatile stock market. Fighting risk and keeping your head above water are key aspects of this business.
Pembina Pipeline (PBA)
Pembina Pipeline (NYSE:PBA) is responsible for operating transportation and storage infrastructure for crude oil from the oil sands of northern Alberta, Canada, to the United States.
It is an example of how technology and innovation can change a country’s infrastructure. The company specializes in long-term, fixed-rate business contracts. In return, the company gets steady cash flow.
Pembina has a history of growing its dividend with steady dividends. It’s continued to expand its dividend as it completes more expansions on the level of infrastructure like new energy projects. Currently, Pembina is building on achievements, including a secure backlog of projects and creating more to fuel future growth.
While Pembina continues to contribute to fossil fuels, it invests in lower-carbon projects. It has been working with another company on a carbon dioxide transportation and sequestration system to help Canada become even more sustainable. Ford has been exploring cleaner alternatives, like hydrogen, to help maximize its dividends in the coming years
STAG Industrial (STAG)
The pandemic has led to an increased demand for online shopping. This is because people are more likely to shop online than in stores. The internet has made it easier and faster for consumers to buy products and brands, which means that e-commerce is booming.
STAG Industrial is positioned to do well as demand for its services increases in the e-commerce and logistics space. This year, STAG is targeting $1 billion to $1.2 billion of capital investments. With its current rental income on its existing properties, STAG should continue increasing its monthly dividend.
LTC Properties (LTC)
LTC Properties, Inc. (NYSE:LTC) is a healthcare REIT. It focuses on investing in high-quality senior housing and skilled nursing facilities (SNFs — also referred to as nursing homes) with triple-net leases secured by private mortgage loans.
Aging is an increasingly relevant topic in modern society. Present-day data suggests that the U.S. population will age more in the next decades. Hence, LTC is subject to secular trends, which helps provide a steady income so they can pay you dividends every month.
The pandemic hit the senior housing sector hard due to poor customer service and the inability of business owners to handle it. This led some tenants who were struggling financially to file for bankruptcy. But this REIT was able to keep its dividend out while losing some money on the sale of certain properties. This has allowed it to maintain its loyal shareholders and investors seeing monthly dividends.
With pandemic conditions gradually improving and the economy and industry, LTC Properties can realize high dividends soon. Investments, which the company made earlier on, will also help sustain the company’s growth.
Sabine Royalty Trust (SBR)
Let’s look at a stock specializing in royalty and mineral interests. Sabine Royalty Trust (NYSE:SBR) owns oil and gas properties across the U.S., enabling it to generate healthy income for shareholders.
For several reasons, Sabine Royalty is well-positioned to take advantage of the rapidly growing energy and inflation trends. Long-term oil prices are expected to remain high, which will lead to higher commodity demand and strong demand for metals and minerals.
In other words, the trust does not generate earnings specifically; rather, it is a way SBR stock investors to make money since its acts as a pass-through vehicle. When a unit holder of the trust decides to sell their shares, they essentially sell all the accrued cash flows (future royalties) and transfer those funds to the units.
The trust has produced stable and consistent annual distributions for investors. These are sensitive to the gyrations of oil and gas, but their expenses are typically lower than other commodity-focused companies.
Dynex Capital (DX)
Dynex Capital, Inc. (NYSE:DX) is a real estate investment trust that invests primarily in mortgage-backed securities (MBS) to create a high-quality dividend-producing stock. The company pays investors an attractive dividend yield of 9.66%.
Market volatility is a big issue for businesses looking to make investments. Business owners need to plan and know what they can expect from the markets in years to come.
Always looking for trustworthy, proven and prestigious companies? Dynex Capital is a company that is worth your attention. The company is structured so that all employees have some say in the decision-making process. In general, this is a good outcome because it leads to less conflict of interest among the various parts of the management team that has, over the years, built a track record of investing profitably. Therefore, it is a great stock to add to any portfolio.
On the publication date, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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