Passive Income
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If I Could Buy Only 1 High-Yield Dividend Stock for Passive Income in July, This Would Be It
The Motley Fool· 2025-07-03 10:10
Core Viewpoint - Realty Income is highlighted as a premier choice for high-yield dividend investment due to its consistent monthly dividends and strong financial foundation [1][11] Company Overview - Realty Income is known as "The Monthly Dividend Company," focusing on delivering dependable monthly dividends that increase over time [3] - The company has declared 660 consecutive monthly dividends since its inception and has raised its payment 131 times since going public in 1994 [4] Dividend Performance - Realty Income has increased its dividend for 111 consecutive quarters and 30 straight years, achieving a compound annual growth rate of 4.2% [4] - The REIT pays a high-yielding monthly dividend of 5.5%, backed by a robust portfolio and financial profile [11] Real Estate Portfolio - Realty Income owns 15,600 properties across various sectors, including retail, industrial, and gaming, leased to leading global companies [5] - 91% of its total rent comes from tenants in industries resilient to economic downturns and insulated from e-commerce pressures [5] Financial Profile - The company holds one of the top 10 highest credit ratings in the REIT sector, allowing for low borrowing costs and significant financial flexibility [6] - Realty Income maintains a conservative dividend payout ratio of about 75% of its adjusted funds from operations (FFO) [6] Growth Potential - The REIT has a history of durable earnings growth, with adjusted FFO per share rising at a 5% annual rate over the past three decades [8] - Realty Income has only experienced one year of negative adjusted FFO per share growth, which occurred during the financial crisis in 2009 [8] Investment Opportunities - Realty Income is positioned to continue expanding its portfolio, with a global net lease market opportunity estimated at $14 trillion across the U.S. and Europe [10] - The company is launching its U.S. Core Plus Fund to tap into the private capital market, providing additional capital for investment and management fee income [9] Conclusion - Realty Income's combination of payment frequency, yield, growth, and financial strength makes it a compelling choice for investors seeking reliable passive income [11]
3 Top High-Yield Dividend Stocks I Plan to Buy in July to Boost My Passive Income
The Motley Fool· 2025-07-02 09:03
Core Insights - The article discusses the importance of generating passive income through investments in high-yielding dividend stocks, highlighting three specific companies: Brookfield Infrastructure, Chevron, and W.P. Carey as attractive options for income generation [2][13]. Brookfield Infrastructure - Brookfield Infrastructure is a leading global infrastructure investor with a diversified portfolio that includes utilities, energy midstream, transportation, and data assets, generating stable cash flow and supporting a dividend yield of over 4% [4]. - The company derives 85% of its funds from operations (FFO) from contracted or regulated assets, which are indexed to inflation, potentially adding 3% to 4% to its FFO per share annually, alongside an expected 1% to 2% growth from global economic expansion [5]. - Brookfield pays out 60% to 70% of its stable cash flow in dividends, allowing for reinvestment in growth projects, which are anticipated to boost FFO per share by 2% to 3% annually, with an overall expectation of more than 10% annual FFO per share growth [6]. Chevron - Chevron's dividend yield is nearing 5%, supported by a strong foundation with the lowest breakeven levels in the sector at approximately $30 per barrel, significantly below recent price points [7]. - The company has maintained a robust balance sheet with a leverage level of 14%, well below its target range of 20%-25%, enabling consistent dividend increases for 38 consecutive years [8]. - Chevron expects its growth projects to contribute an additional $9 billion to free cash flow next year at a $60 oil price and is pursuing an acquisition of Hess to enhance its production and cash flow growth outlook [9]. W.P. Carey - W.P. Carey is a diversified real estate investment trust (REIT) that owns critical operational real estate, including warehouse and retail properties, with leases that feature rental escalations tied to inflation, supporting a dividend yield of 5.5% [10]. - The REIT pays out about 70% to 75% of its stable cash flow in dividends, allowing for reinvestment in additional income-generating properties, supported by a strong balance sheet [11]. - W.P. Carey has consistently raised its dividend every quarter since late 2023, following a strategic exit from the office sector, and had previously increased its dividend annually for 25 years [12].
3 Top High-Yield Stocks to Buy in July to Collect Passive Dividend Income Every Single Month
The Motley Fool· 2025-07-01 07:19
Group 1: EPR Properties - EPR Properties is a REIT focused on experiential real estate, owning properties like movie theaters and casinos, providing stable cash flow for dividends [3] - The REIT pays $0.295 per share monthly, equating to an annual dividend of $3.54, yielding over 6% [4] - EPR retains about 30% of its cash flow for investments, planning to invest $200 million to $300 million in new properties this year, aiming for 3% to 4% annual cash flow growth [5] Group 2: Realty Income - Realty Income, known as The Monthly Dividend Stock, has raised its dividend 131 times since 1994, focusing on dependable monthly dividends [6] - The next monthly dividend payment is $0.269 per share, a 0.2% increase from the previous month, resulting in an annualized rate of $3.228 and a yield of approximately 5.5% [7] - Realty Income pays out about 75% of its cash flow in dividends, allowing for significant reinvestment in new income-generating properties [8] Group 3: Main Street Capital - Main Street Capital is a BDC providing capital to lower middle market companies, generating recurring income through its capital solutions model [10] - The company will pay $0.255 per share on July 15, with an annualized rate of $3.06, yielding over 5% [11] - Main Street Capital has increased its monthly dividend by 2% from the previous quarter and 4.1% year-over-year, also paying supplemental dividends to meet IRS distribution requirements [12] Group 4: Investment Opportunity - EPR Properties, Realty Income, and Main Street Capital are highlighted as ideal dividend stocks for generating monthly passive income, with potential for steady growth [13]
Investing $25,000 in These 2 Warren Buffett Stocks Will Generate $1,200 in Annual Passive Income
The Motley Fool· 2025-06-29 16:04
Group 1: Market Overview - The market experienced significant volatility this year, falling into bear market territory from its highs in February, but has since recouped losses and is approaching near all-time highs [1] Group 2: Investment Opportunities - Investors may consider adding dividend stocks for reliable passive income, with Berkshire Hathaway's portfolio being a prime example [2] - Investing $25,000 in two selected Warren Buffett stocks could generate approximately $1,200 in annual passive income [2] Group 3: Chevron - Chevron has a dividend yield of 4.77% and is a significant position in Berkshire's $283 billion equities portfolio, making up 6% of it [3][7] - The company operates extensive oil operations, particularly in the Permian Basin, projecting 5% to 6% compound annual growth in oil production and $2 billion in free cash flow growth by 2026 [5] - Chevron expects to increase total free cash flow by $9 billion by 2026, assuming Brent Crude Oil prices remain around $60 per barrel [6] - The company has increased its dividend for 38 consecutive years and has a trailing free cash flow yield of nearly 5.3%, allowing it to cover its dividend [7] - Chevron is also repurchasing $10 billion to $20 billion in stock annually as a method to return capital to shareholders [7] Group 4: Sirius XM - Sirius XM has a dividend yield of 4.80% but has seen its stock decline by about 59% over the last five years due to subscriber growth challenges [8][9] - Berkshire Hathaway has acquired over 35% of Sirius' outstanding shares, betting on management's long-term plan to grow subscribers from 40 million to 50 million and increase free cash flow from $1.2 billion to $1.8 billion [10] - The company plans to enhance in-car technology, launch a new pricing structure, and grow its advertising business, which currently constitutes only 20% of its revenue [10][11] - Sirius XM has paid and increased its dividend every year since 2016, with a trailing-12-month free cash flow yield exceeding 12%, making the dividend sustainable [12] - The stock is currently trading at less than 8 times forward earnings, presenting a potentially attractive investment opportunity while management executes its turnaround plan [12]
