Are you looking for some dividend stocks you can comfortably hang onto forever, without feeling like you must start thinking defensively every time things get a little shaky? They’re out there. There aren’t a whole lot of these rock-solidly reliable income-generating names, but they’re out there.
Here’s a closer look at three of them, only one of which is likely to be a name you’re highly familiar with.
Tractor Supply
The prevailing narrative suggests the entire brick-and-mortar retailing business is on its deathbed. But that’s not quite the case. Most of the industry’s misery is limited to malls in general, and department stores in particular. Focused, specialized retailers like pet stores and sporting goods stores are still doing surprisingly well.
And there’s an often-overlooked player in the specialty retail space that’s latched onto a cultural shift that isn’t likely to unwind anytime soon. That shift is the growing preference for self-sufficiency and a greater awareness of how we live, and even what we eat. The company is home-farm supply outfit Tractor Supply (TSCO 2.58%). Most of the retailer’s 2,395 stores are located in suburbs and even in rural areas, where such a lifestyle shift is feasible, and where its goods, ranging from seeds to fencing to boots to tools, are most marketable to consumers.
This didn’t seem to be the case just a few days ago, when the retailer reported first-quarter results that missed expectations. Specifically, while revenue of $3.6 billion was in line with analysts’ estimates, per-share earnings of $0.31 fell short of the consensus of $0.34 per share. Same-store sales growth of only 0.5% also missed forecasts for year-over-year growth of 1.6%. Already on the defensive, the news upended TSCO stock, driving it well into multiyear territory.
Today’s Change
(-2.58%) $-0.92
Current Price
$34.67
Key Data Points
Market Cap
$19B
Day’s Range
$34.37 – $35.32
52wk Range
$34.37 – $63.99
Volume
211K
Avg Vol
7.4M
Gross Margin
33.23%
Dividend Yield
2.61%
In many ways, however, this sharp sell-off may also serve as the last frenzied leg of a sell-off that needed to run its full course before turning back into an uptrend.
The prospect of a recovery effort starting to take shape here is certainly high. Although last quarter’s earnings missed estimates, the company still contends that same-store sales will improve between 1% and 3% this year, lifted by overall revenue growth of between 4% and 6%. It’s also still looking for respectable earnings growth of around 6%, which, of course, will continue supporting a dividend payment that’s now been raised for 17 consecutive years.
Newcomers will be plugging in while TSCO’s forward-looking dividend yield stands at a decent 2.6%.
Realty Income
Speaking of retail, how would you like to be a landlord to some of the retail industry’s most resilient names like Walmart, Dollar General, Home Depot, and yes, even the aforementioned Tractor Supply? Well, you can. That’s what a stake in real estate investment trust (REIT) Realty Income (O 0.38%) does. The company owns 15,511 different retail properties offering a total of 355 million square feet of retail space that’s consistently more than 98% occupied.
Image source: Getty Images.
The real estate leasing business is obviously ideally suited for supporting recurring dividends, which Realty Income has proven in earnest for decades now. Not only has it paid a dividend like clockwork since it was founded in 1969, but it has also raised its quarterly per-share payout in each of the past 114 quarters. The stock’s forward-looking dividend yield at this time is a healthy 5.1%.
The kicker: Unlike most other dividend stocks, Realty Income dishes out its dividends on a monthly rather than on a quarterly basis. If you need investment income to help cover some of your monthly living expenses, this income name is a particularly convenient one to own.
Today’s Change
(-0.38%) $-0.24
Current Price
$63.31
Key Data Points
Market Cap
$59B
Day’s Range
$63.13 – $63.59
52wk Range
$54.38 – $67.94
Volume
76K
Avg Vol
6.2M
Gross Margin
48.73%
Dividend Yield
5.09%
Verizon
Finally, add wireless telecom giant Verizon Communications (VZ 1.76%) to your list of income stocks you can buy now and never sell, while its forward-looking dividend yield is just over 6%.
The thesis here is pretty obvious. Consumers may cut back on discretionary purchases when money is tight or postpone the purchase of a new automobile. They’re almost certainly going to maintain their mobile connection to the rest of the world, though. We’re arguably addicted to our smartphones, after all. A recent survey performed by Reviews.org indicates that Americans check their cellphones an average of 186 times per day just to make sure they’ve not missed anything, contributing to the five hours they’re typically looking at their device’s screen every day.
Today’s Change
(-1.76%) $-0.83
Current Price
$46.41
Key Data Points
Market Cap
$199B
Day’s Range
$46.38 – $47.53
52wk Range
$38.39 – $51.68
Volume
465K
Avg Vol
31M
Gross Margin
45.50%
Dividend Yield
5.85%
Mentally healthy or not, people aren’t likely to give up their wireless service now. Verizon simply needs to make sure it remains competitive with AT&T and T-Mobile US, which it is. The company added (net) 340,000 new postpaid wireless customers during the first quarter of this year, and expects to add as many as one million customers over the course of 2026.
Perhaps of more interest to income-minded investors, Verizon has upped its per-share dividend payment in each of the past 19 years, and by more than a little. The current quarterly payment is nearly 75% bigger than its payout was back at the beginning of 2006. You might not get a ton of capital appreciation from this stock, but you’ll certainly get plenty of ever-rising income.
Leave a comment