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Why Plains All American Pipeline Jumped Nearly 11% in June
The Motley Fool· 2025-07-03 14:42
Core Viewpoint - Plains All American Pipeline's stock surged 10.8% in June following the announcement of the sale of its Canadian NGL business to Keyera for $3.75 billion in cash, which is expected to close in the first quarter of 2026 [1][2]. Group 1: Transaction Details - The sale of the Canadian NGL business will transform Plains All American into a premier midstream pure-play company focused on crude oil [2][4]. - The company anticipates receiving approximately $3 billion in net proceeds from the sale after accounting for taxes and transaction costs [5]. Group 2: Financial Implications - The transaction is expected to enhance cash flows and reduce exposure to commodity price volatility, leading to more durable cash flows and greater financial flexibility [4][6]. - Plains All American's leverage ratio is projected to be at or below the low end of its target range of 3.25-3.75 times, providing flexibility for capital allocation [6]. Group 3: Growth and Investment Strategy - The company plans to utilize its financial flexibility for bolt-on acquisitions to strengthen its crude oil portfolio and optimize its capital structure [5]. - Plains has a history of enhancing shareholder value through strategic acquisitions and repurchases, as demonstrated by its recent $670 million in acquisitions and $330 million in preferred unit repurchases [7]. Group 4: Investment Appeal - Despite the recent stock surge, Plains All American continues to trade at an attractive value with a high yield of over 8%, making it a viable option for investors seeking sustainable passive income [8]. - The company offers two investment options: units of Plains All American Pipeline for tax benefits and shares of Plains GP Holdings for those preferring simpler tax reporting [9].
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
I'm on a mission to reach financial independence through passive income. Investing in high-yielding dividend stocks is a core piece of my strategy, so I tend to buy several dividend stocks each month as I have cash to invest. However, if I had to limit myself to just one high-yield dividend stock this July, Realty Income (O -0.07%) would be it. Here's why I think it's the quintessential income investment. Built to deliver dependable monthly dividendsRealty Income isn't like other real estate investment trus ...
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]
Why I Can't Stop Buying These 2 Top High-Yield Dividend Stocks
The Motley Fool· 2025-06-26 10:12
Group 1: PepsiCo - PepsiCo's dividend yield is approaching 4.5%, significantly higher than the S&P 500's yield of less than 1.5%, marking its highest level this decade [4] - The company has a strong history of dividend payments, recently increasing its dividend by 5%, extending its growth streak to 53 consecutive years, with a 7.5% compound annual growth rate over the past 15 years [5] - PepsiCo's robust portfolio generates substantial cash flow, allowing for investments in product innovation and capacity expansions, with expected revenue growth of 4%-6% annually and high-single-digit earnings per share growth [6] - The company has made strategic acquisitions to enhance its portfolio, focusing on healthier options, which positions it for long-term growth and continued dividend increases [7] Group 2: Vici Properties - Vici Properties offers a dividend yield over 5%, supported by a stable and growing rental income stream from its extensive portfolio of gaming and entertainment properties [8] - The REIT owns 54 gaming properties and has a significant number of long-term triple net leases, with 42% of leases tied to inflation, expected to rise to 90% by 2035, ensuring stable rental income [9][10] - Vici pays out approximately 75% of its cash flow in dividends while maintaining an investment-grade balance sheet, allowing for further investments in income-generating real estate [11] - The company has consistently raised its dividend since its formation, achieving a 7.4% compound annual growth rate, outperforming its peers in the NNN REIT sector [12] Group 3: Investment Outlook - Both PepsiCo and Vici Properties are identified as strong candidates for passive income investments due to their high-yielding dividends and solid financial profiles, with a track record of consistent dividend growth [13]
