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2 Top Dividend Stocks Down More Than 12% That You'll Regret Not Buying
BIPBrookfield Infrastructure Partners(BIP) The Motley Fool·2025-03-19 08:26

Group 1: Market Overview - Stock market sell-offs present opportunities for dividend investors as falling stock prices lead to rising dividend yields [1] - Realty Income and Brookfield Infrastructure have both experienced significant declines, with Realty Income down over 12% and Brookfield Infrastructure down more than 21% from their 52-week highs [2][8] Group 2: Realty Income - Realty Income's stock price decline has increased its dividend yield to an attractive 5.7% [3] - The REIT generated 4.19pershareofadjustedfundsfromoperations(FFO)lastyear,tradingatapproximately13.5timesitsFFO,whichisconsideredlowcomparedtopeers[4]RealtyIncomehasastrongdividendhistory,havingincreaseditspayment130timesoverthreedecades,withacompoundannualgrowthrateof4.34.19 per share of adjusted funds from operations (FFO) last year, trading at approximately 13.5 times its FFO, which is considered low compared to peers [4] - Realty Income has a strong dividend history, having increased its payment 130 times over three decades, with a compound annual growth rate of 4.3% [5] - The company has a robust financial profile, evidenced by its high credit ratings, allowing access to low-cost capital for investments [6] - Realty Income has a significant growth opportunity with a total addressable market of 5.4 trillion in the U.S. and 8.5trillioninEurope[7]Group3:BrookfieldInfrastructureBrookfieldInfrastructuresstockpricedrophasraiseditsdividendyieldto4.98.5 trillion in Europe [7] Group 3: Brookfield Infrastructure - Brookfield Infrastructure's stock price drop has raised its dividend yield to 4.9% [8] - The company has consistently increased its dividend for 16 years, with a compound annual growth rate of 9% [8] - Brookfield anticipates a need for 100 trillion in global infrastructure investment over the next 15 years, providing ample growth opportunities [9] - The company has 8billioninexpansionprojectsunderwayandanadditional8 billion in expansion projects underway and an additional 4 billion in development [9] - Growth drivers include inflation-driven rate increases, volume growth, and accretive acquisitions, with expectations of over 10% annual growth in FFO per share [10] - Brookfield trades at a valuation of just over 11 times FFO, which is low compared to the S&P 500's more than 20 times earnings [11][12] Group 4: Investment Outlook - The sell-offs in Realty Income and Brookfield Infrastructure have created attractive investment opportunities due to lower valuations and higher dividend yields [13] - Both companies are well-positioned for continued dividend growth, which could lead to strong total returns over the long term [13]