The Motley Foolยท2025-06-20 08:25Core Viewpoint - Generating high dividend income requires careful selection of stocks to avoid potential cuts or suspensions in dividend payments, emphasizing the importance of analyzing a company's financial health and future prospects. Group 1: Verizon Communications - Verizon offers a dividend yield of 6.4%, which is considered safe despite a modest share price increase of around 7% over the past year [4][5] - The company's payout ratio stands at a sustainable 64% of its earnings, and it has increased its dividend for 18 consecutive years, with a 23% increase in its quarterly dividend over the past decade [5] - Verizon is projected to generate free cash flow of at least $17.5 billion this year, exceeding its annual dividend payout of approximately $11.3 billion, making it an attractive dividend stock [6] Group 2: United Parcel Service (UPS) - UPS provides a slightly higher dividend yield of 6.5%, with an expected annual dividend income of $715 from an $11,000 investment [8] - The stock has seen a 20% decline in share price since the beginning of the year, which has increased its yield, presenting a favorable buying opportunity [9] - UPS's payout ratio is around 100%, and it generated $5.4 billion in free cash flow over the past year, indicating tight margins but ongoing efforts to cut costs, including a layoff of 20,000 workers [9][11] Group 3: Vici Properties - Vici Properties, a REIT, has a dividend yield of 5.4%, with an annual dividend income of approximately $594 from an $11,000 investment [12] - The company's funds from operations (FFO) per share for the first three months of 2025 was $0.51, which exceeds its current quarterly dividend of $0.4325, indicating a safe payout [13] - Vici's portfolio includes major gaming destinations, providing a stable income stream, and it trades at 13 times its trailing earnings, making it a modestly priced investment [14]