Investing

7 Safe Stocks That Pay You Serious Dividends

Lee Jackson

Published: December 30, 2023 9:10 am

Investors love dividend stocks because they provide dependable income and give investors a great opportunity for solid total return. Total return includes interest, capital gains, dividends, and distributions realized over time. In other words, the actual investment or portfolio return consists of dividend income and stock appreciation.

We screened our 24/7 Wall St. dividend stock database, looking for solid companies in the S&P 500 that were rated Buy at major Wall Street firms that also paid among the highest and safest dividends. Seven top companies hit our screens, and all of them make sense for investors looking for total return and dependable passive income.

Best Buy

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The need for the electronics and gear to set up a “work from home” office has been a massive tailwind for this leading retailer, which pays a rich 4.72% dividend. Best Buy Inc. (NYSE: BBY) retails technology products in the United States and Canada. The company operates in two segments, Domestic and International.

Best Buy stores provide computing products, such as:

• Desktops
• Notebooks, and peripherals
• Mobile phones comprising related mobile network carrier commissions
• Networking products
• Tablets covering e-readers; smartwatches
• Consumer electronics consisting of digital imaging, health and fitness
• Home theater
• Portable audio comprising headphones and portable speakers
• Smart home products

The company’s stores also offer:

• Appliances, such as dishwashers, laundry, ovens, refrigerators, blenders, coffee makers, and vacuums
• Entertainment products consisting of drones, peripherals, movies, music, and toys, as well as gaming hardware and software, and virtual reality and other software products
• Baby, food and beverage
• Luggage
• Outdoor living
• Sporting goods

In addition, it provides consultation, delivery, design, health-related, installation, memberships, repair, set-up, technical support, and warranty-related services.

Crown Castle International

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This top cell tower company offers incredible growth and income possibilities with a big 5.39% dividend. Crown Castle International Corp. (NYSE: CCI) is one of the largest U.S. wireless tower companies, with over 40,000 towers and approximately 85,000 route miles of fiber supporting small cells and fiber solutions across every primary U.S. market.

The company’s core business is primarily leasing space on its wireless towers to wireless carriers, government agencies, and broadband data providers.

Crown Castle is one of the best stocks in the group for more conservative investors as the high yield distribution and low volatility make it a good holding for accounts seeking growth and income and less risk.

Dow

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This company was spun out from Dupont in 2019 and offers investors growth, income potential, and a hefty 5.03% dividend. Dow Inc. (NYSE: DOW) is a leading materials science company formed due to the merger of Dow and DuPont in 2017 and the subsequent spin in 2019.

The company is organized into three principal divisions:

• Performance Materials and coatings
• Industrial Intermediates and infrastructure
• Packaging and specialty Plastics

The Company’s segments include Agricultural Sciences, which provides crop protection, seed/plant biotechnology products and technologies, urban pest management solutions, and healthy oils.

Consumer Solutions, which consists of:

• Consumer Care
• Dow Automotive Systems
• Dow Electronic Materials
• Consumer Solutions-Silicones businesses

Infrastructure Solutions, which consists of:

• Dow Building & Construction
• Dow Coating Materials
• Energy & Water Solutions
• Performance Monomers and Infrastructure Solutions-Silicones businesses
• Performance Materials & Chemicals, which consists of Chlor-Alkali and Vinyl, Industrial Solutions and Polyurethanes businesses
• Performance Plastics, which consists of Dow Elastomers, Dow Electrical and Telecommunications, Dow Packaging and Specialty Plastics, Energy and Hydrocarbons businesses

Enterprise Products Partners

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This company is the most significant publicly traded energy partnership and a leading North American provider of midstream energy services to producers and consumers, delivering a strong 7.63% dividend.

Enterprise Products Partners L.P. (NYSE: EPD) provides various midstream energy services, including:

• Gathering
• Processing
• Transporting
• Storing natural gas
• Natural gas liquids (NGL) fractionation
• Import and export terminalling
• Offshore production platform services.

The company has four reportable business segments:

• Natural Gas Pipelines and Services
• NGL Pipelines and Services
• Petrochemical Services
• Crude Oil Pipelines and Services

One of the reasons many analysts may like the stock might be its distribution coverage ratio. The company’s distribution coverage ratio is well above 1x, making it relatively less risky in the MLP sector.

Philip Morris International

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This company has continued to grow its global market share and pays a fat 5.54% divided. Philip Morris International Inc. (NYSE: PM) is one of the largest international cigarette producers, with a share of 28% of the global cigarette/heated tobacco market.

Key combustible brands include:

• Marlboro,
• Parliament
• L&M

The company is commercializing IQOS, a heat-not-burn product, in over 40 markets, which could drive earnings in the future. Most on Wall Street believe Philip Morris International offers superior underlying growth prospects, both near-term and long-term.

The shares have traded sideways over the last year as investors have questioned the growth potential of its reduced-risk products. 100% of the sales are outside of the United States.

Verizon Communications

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This top telecommunications company offers tremendous value at current levels and pays investors a stellar 7.13% dividend. Verizon Communications, Inc (NYSE: VZ) is one of the largest US telecom companies. It provides wireless and wireline services to retail, enterprise, and wholesale customers.

The company’s wireless network serves approximately 120 million mobile connections with 115 million postpaid subscribers. Verizon’s wireline business has undergone a period of secular decline due to wireless substitution and cable competition.

Verizon also provides

• Converged communications
• Information, and entertainment services over America’s most advanced fiber-optic network
• Delivers integrated business solutions to customers worldwide

Whirlpool

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The potential for continued new home sales to increase is a big positive for this company, which pays a dependable 5.71% dividend. Whirlpool Corporation (NYSE: WHR) manufactures and markets home appliances and related products.

It operates through four segments:

• North America
• Europe, the Middle East and Africa
• Latin America
• Asia

The company’s principal products include

• Refrigerators
• Freezers
• Ice makers
• Refrigerator water filters
• Laundry appliances and related laundry accessories
• Cooking and other small domestic appliances
• Dishwasher-associated appliances and accessories
• Mixers

Whirlpool markets and distributes its products primarily under these brands:

• Whirlpool
• Maytag
• KitchenAid
• JennAir
• Amana
• Roper
• Admiral
• Affresh,
• Gladiator
• Speed Queen
• Hotpoint
• Bauknecht
• Indesit
• Ignis
• Laden
• Privileg
• KIC
• Consul
• Brastemp
• Acros
• Ariston
• Diqua
• Royalstar