Investing

7 Blue-Chip Bargains With 7% and Higher Dividends

Lee Jackson

Published: February 23, 2024 10:10 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 total return on an investment or a portfolio consists of income and stock appreciation.

At 247 Wall St., we always like to remind our readers about the impact total return has on portfolios because it is one of the best ways to help improve the chances for overall investing success. Again, total return is the combined increase in a stock’s value plus dividends.

Investors looking for solid passive income ideas with added dividends have come to the right place. We screened our 24/7 Wall St. blue-chip dividend stock research universe and found 7 top companies paying at least 7% dividends and are buy-rated at top Wall Street firms.

Altria

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This maker of tobacco products offers value investors a great entry point now and pays a rich 9.76% dividend. Altria Group Inc. (NYSE: MO) manufactures and sells smokable and oral tobacco products in the United States through its subsidiaries.

The company provides cigarettes primarily under the Marlboro brand;

• cigars and pipe tobacco principally under the Black & Mild brand
• moist smokeless tobacco products and snus products under the Copenhagen, Skoal, Red Seal, and Husky brands
• on! Oral nicotine pouches.

Altria also owns over 10% of Anheuser-Busch InBev (NYSE: BUD), the world’s largest brewer, which some feel is worth more than $10 billion and a segment of the company that could be sold. Given the public relations disaster the company has gone through over the last year, it could be on the chopping board.

In June of 2023, the company purchased NJOY Holdings, which makes electronic cigarettes and vaping products, for a consideration of $2.75 billion. The company has increased its dividend for 52 consecutive years.

Energy Transfer

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The top master limited partnership is a safe way for investors looking for energy exposure and income as the company pays a massive 8.66% distribution. Energy Transfer LP (NYSE: ET) owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with a strategic footprint in all of the major domestic production basins.

The company is a publicly traded limited partnership with core operations that include:

• Natural gas midstream
• Intrastate and interstate transportation and storage assets
• Crude oil, natural gas liquids (NGL)
• Refined product transportation and terminalling assets
• NGL fractionation
• Various acquisition and marketing assets

After the purchase of Enable Partners in December of 2021, Energy Transfer owns and operates more than 114,000 miles of pipelines and related assets in all of the major U.S. producing regions and markets across 41 states, further solidifying its leadership position in the midstream sector.

Through its ownership of Energy Transfer Operating, L.P., formerly known as Energy Transfer Partners, L.P., the company also owns Lake Charles LNG Company, as well as the general partner interests, the incentive distribution rights, and 28.5 million standard units of Sunoco LP (NYSE: SUN), and the general partner interests and 39.7 million standard units of USA Compression Partners, LP (NYSE: USAC).

Kohl’s

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This top retailer got struck in early October and still offers an excellent entry point, yielding 7.26%. Kohl’s Corp. (NYSE: KSS) operates department stores in the United States.

Kohls provides private label, exclusive, and national brand apparel, footwear, accessories, beauty, and home products to children, men, and women customers. The company also sells its products online at Kohls.com and through mobile devices.

The company provides its products primarily under the brand names of:

• Croft & Barrow
• Jumping Beans
• SO
• Sonoma Goods for Life
• Food Network,
• LC Lauren Conrad
• Nine West
• Simply Vera
• Vera Wang.

Kohl has a partnership where Amazon customers can return items through the retailer. Some feel the deal should be expanded with a full partnership or even Amazon buying Kohls.

MPLX

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This company is one of the top holdings in the Alerian MLP energy exchange-traded fund, paying shareholders a strong 8.71% dividend. MPLX LP. (NYSE: MPLX) is primarily engaged in transportation of crude oil and refined products and terminating in the US Midwest and Gulf Coast regions and natural gas gathering and processing in the northeast from its prior acquisition of MarkWest Energy in 2015. 

The company’s assets include a network of:

• Crude oil and refined product pipelines
• An inland marine business
• Light-product terminals
• Storage caverns
• Refinery tanks
• Docks
• Loading racks, and associated piping
• Crude and light-product marine terminals

MPLX also owns crude oil and natural gas gathering systems and pipelines and natural gas and NGL processing and fractionation facilities in key U.S. supply basins.

Sabra Healthcare

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This is one of the larger companies in their industry and pays a massive 8.73% distribution. Sabra Healthcare REIT, Inc. (NASDAQ: SBRA) is an internally managed healthcare REIT that invests in a skilled nursing (SNF) and senior housing.

As of September 30, 2023, Sabra’s investment portfolio included:

• 377 real estate properties held for investment 
• 240 Skilled Nursing/Transitional Care facilities
• 43 senior housing communities 
• 61 senior housing communities operated by third-party property managers under property management agreements
• 18 Behavioral Health facilities and (v)
• 15 Specialty Hospitals and Other facilities),
• 12 investments in loans receivable (consisting of two mortgage loans and ten other loans),
• Five preferred equity investments 
• Two investments in unconsolidated joint ventures.

As of September 30, 2023, Sabra’s real estate properties held for investment included 37,606 beds/units spread across the United States and Canada.

TC Energy

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While perhaps off-the-radar for many investors, yielding 7.18%, this dual-threat energy company is a steal at current levels. TC Energy Corporation (NYSE: TRP) is an energy infrastructure company in North America.

It operates through five segments:

• Canadian Natural Gas Pipelines
• U.S. Natural Gas Pipelines
• Mexico Natural Gas Pipelines
• Liquids Pipelines
• Power and Energy Solutions

The company builds and operates a network of:

• 93,600 natural gas pipelines and transports natural gas from supply basins to local distribution companies
• Power generation plants
• Industrial facilities
• Interconnecting pipelines
• LNG export terminals
• Other businesses

It also has regulated natural gas storage facilities with a total working gas capacity of 532 billion cubic feet.

In addition, it has approximately 4,900 kilometers of liquids pipeline system that connects Alberta crude oil pipeline to refining markets in Illinois, Oklahoma, Texas, and the United States Gulf Coast.

Finally, the company owns or has interests in power generation facilities with approximately 4,600 megawatts and owns and operates roughly 118 billion cubic feet of non-regulated natural gas storage facilities in Alberta, Ontario, Québec, and New Brunswick.

Western Union

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While the demand for telegrams is long gone, the demand to transfer money has not, and this famous company has grown as a result and pays a sweet 7.35% dividend. The Western Union Company (NYSE: WU) provides worldwide money movement and payment services.

The company operates in two segments:

• Consumer-to-Consumer 
• Business Solutions.

The Consumer-to-Consumer segment facilitates money transfers for international cross-border and intra-country transfers, primarily through a network of retail agent locations and through websites and mobile devices.

The Business Solutions segment provides payment and foreign exchange solutions, primarily cross-border and cross-currency transactions for small and medium-sized enterprises, other organizations, individuals, and foreign currency forward and option contracts.

It also offers bill payment services that facilitate payments from consumers to businesses and other organizations, as well as money orders and other services.