Some stocks generate greater income streams, while others offer more reliability. If you’re looking for both, check out these three dividend-paying stocks.
You might just drool AbbViefrom (NYSE: ABBV) dividend yield close to 5.2%. You will also almost certainly like the drugmaker’s dividend track record. AbbVie is a dividend aristocrat – a term for S&P 500 members who have increased their dividends for at least 25 consecutive years.
Could the imminent entry of biosimilar competitors of AbbVie’s best-selling drug, Humira, into the US market threaten the company’s dividend? I do not think so. First, sales of Humira will not completely evaporate overnight when the biosimilars hit the US market in 2023. More importantly, AbbVie has plenty of other products to generate revenue.
Rinvoq and Skyrizi seem to be worthy successors of Humira. AbbVie’s blood cancer drugs Imbruvica and Venclexta will continue to be huge winners. The company’s acquisition of Allergan earlier this year has given it several successful franchises, most notably Botox. In addition, AbbVie’s pipeline includes several promising candidates who could increase his fortune in the future.
AbbVie is unlikely to provide breathtaking revenue and profit growth with the challenges ahead for Humira. However, investors should still be able to count on solid dividends from the company.
2. Brookfield Renewable Partners
Brookfield Renewable Partners (NYSE: BEP), on the other hand, is the type of stocks that should deliver great dividends with solid growth in income and earnings. The company’s dividend yield currently sits north of 3.4%. Brookfield Renewable has grown its distribution by an average of 6% per year over the past two decades.
Growth shouldn’t be a problem for the business. Brookfield Renewable Partners is one of the world’s leading providers of renewable energy. It has hydroelectric, solar and wind power plants on four continents. The company can currently generate 18 gigawatts of renewable energy, but has a development pipeline that could double its capacity.
Many countries have set ambitious carbon reduction targets, benefiting renewable energy companies like Brookfield Renewable. It also helps to ensure that wind and solar are now the cheapest sources of bulk electricity generation, with costs even lower than natural gas.
There is an alternative to Brookfield Renewable Partners that you may also want to consider. Brookfield Renewable Corporation (NYSE: BEPC)is the same underlying business but is organized as a traditional company rather than a limited partnership (LP). This corporate structure eliminates certain tax problems associated with investing in a limited partnership.
3. Innovative Industrial Properties
If you want a good dividend and fantastic growth, innovative industrial properties (NYSE: IIPR) could be just the ticket. The Medical Cannabis Real Estate Investment Trust (REIT) has a dividend yield of over 3%. Its stock has almost doubled so far in 2020.
IIP has a solid revenue stream generated from over 60 medicinal cannabis properties. He typically buys property from a medical cannabis operator and then leases it to the operator. As a REIT, IIP must remit at least 90% of its taxable income to shareholders in the form of dividends.
The company should be able to easily maintain its solid growth by completing more sale-leaseback transactions. Tenants of IIP include many of the largest US multi-state cannabis operators. It will not be surprising that the company will expand its relationships with some of these large clients in the near future.
IIP also has the potential to expand into other markets. The company currently has properties in 16 states, but with the recent US election, 35 states have now voted to legalize medical cannabis. IIP could be positioned to deliver even higher total returns than AbbVie and Brookfield Renewable over the next several years.