Top High-Yield Dividend Stocks for Long-Term Investors: Affordable Options to Purchase and Keep Indefinitely

Table of contents

Top High-Yield Dividend Stocks for Long-Term Investors: Affordable Options to Purchase and Keep Indefinitely

Few things are more satisfying than seeing a growing stream of passive income flowing into your brokerage account. If you’ve been hesitant to invest because you think you can’t afford it, I have good news. Now that brokerages have waived trading fees, it takes less than $100 to benefit from quarterly payouts from two legendary dividend payers.

At recent prices, Altria Group (NYSE:MO)And Pfizer (NYSE:PFE) offer to investors dividend yields of 9.1% and 6.1% respectively. That’s significantly more than the 1.35% return you’d get from the average benchmark stock. S&P500 hint.

Top High-Yield Dividend Stocks for Long-Term Investors: Affordable Options to Purchase and Keep Indefinitely

Image source: Getty Images.

Unusually high dividend yields are usually a sign that the market doesn’t think a company has what it needs to increase its distributions further. These two stocks stand out because they offer huge dividend yields right out of the gate, and there’s a good chance their dividends will increase steadily throughout your retirement years.

Altria Group

Altria Group is the tobacco giant that markets the leading Marlboro brand in America. Last August, it increased its dividend for the 58th time in 54 years. The 4.3% payout increase was in line with the company’s established plan to increase its payouts by an average single-digit annual percentage.

Despite management’s plan to deliver consistent dividend growth, the stock offers a whopping 9.1% yield. The stock price is under pressure because investors are worried about a steady decline in sales of combustible cigarettes. They also worry about competitive pressure from an illicit vaping market that does not comply with the flavor ban established by the U.S. Food and Drug Administration (FDA).

Altria reported a drop in Marlboro shipments of 8.8% in 2023. The company was able to offset the decrease in cigarette volume with price increases on premium brands and increased sales of non-combustible products. Overall, the company reported net excise tax revenue down 0.9% last year.

Altria’s revenue has declined, but careful cost control and a reduction in the number of shares have allowed adjusted earnings per share to rise 2.3% last year and a further development in the good direction seems likely. Last year, Altria acquired NJOY, one of three e-cigarette products approved for sale by the FDA. Competitive pressure from the illicit e-vapor market may ease in 2024 with increasing enforcement of the FDA’s flavor ban on nicotine products.

Pfizer

Pfizer expanded its collection of established medicines in 2020. Today, it has the largest collection of innovative medicines in the pharmaceutical industry with patent-protected market exclusivity. At recent prices, the stock offers a yield of 6.1%.

Pfizer has increased its dividend payout every year since 2009. Unfortunately, its pace of dividend increases hasn’t been anything to write home about in recent years. The company’s payouts have only increased 16.7% since 2020.

The stock has fallen about 38% since the start of 2023, largely because sales of COVID-19-related products have evaporated much faster than expected. However, excluding COVID-19 product sales, revenue grew 7% in 2023 driven by new product launches and expansion of new indications for existing products.

Pharmaceutical companies are made up of many parts moving in opposite directions. For example, revenue from Xeljanz, an anti-inflammatory tablet approved by the FDA 12 years ago, fell 5% to $1.7 billion last year. Xeljanz’s losses were more than offset by rising sales of a rare heart disease drug launched in 2019, called Vyndaqel.

Vyndaqel sales soared 36% to $3.3 billion in 2023 and there could be a lot of new stuff. blockbuster drugs on my way. Pfizer received FDA approval for a record nine new drugs last year. Buying certain stocks now to hold them for an indefinite period seems like a smart move for investors who want to increase their passive income stream.

Should you invest $1,000 in Altria Group right now?

Before buying Altria Group stock, consider this:

THE Motley Fool Stock Advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now… and the Altria group was not one of them. The 10 selected stocks could produce monster returns in the years to come.

Equity Advisor provides investors with an easy-to-follow plan for success, including portfolio building advice, regular analyst updates, and two new stock picks each month. THE Equity Advisor The service has more than tripled the performance of the S&P 500 since 2002*.

See the 10 values

*Stock Advisor returns March 25, 2024

Cory Renauer has no position in any of the stocks mentioned. The Motley Fool holds positions at and recommends Pfizer. The Motley Fool has a disclosure policy.

2 High-Yielding Dividend Stocks You Can Buy with $100 Now and Hold Forever was originally published by The Motley Fool

Source Reference

Latest stories