Two Ironclad Dividend Stocks On my Radar Right Now
In today’s episode of the 24/7 Wall St Podcast Lee Jackson and Doug McIntyre look at two ironclad dividend stocks with monster yields that could be worth investing in today. With yields well north of treasury rates, both stocks have…
In today’s episode of the 24/7 Wall St Podcast Lee Jackson and Doug McIntyre look at two ironclad dividend stocks with monster yields that could be worth investing in today. With yields well north of treasury rates, both stocks have a decades long history of paying investors handsome income.
Transcript:
One of the things that I’ve been looking at is Verizon and Altria. For people who don’t know, because they did a very good job of it, Philip Morris is now Altria. They didn’t want people to know they were a cigarette company. They eventually bought Kraft Foods, which they spun out in 2007. But to me, leaving aside whether there’s a national ethical issue here, you do have a yield north of 9% in a sort of normal range public equity. You have cash flow every single quarter, positive. In Marlboro, you’ve got one of the great brands of the last 50, 60 years. And you’ve got cash on the balance sheet for which you don’t have any use other than buying back your own shares.
If I look at Verizon, it’s a little bit more of a growth story, but not much. It’s the largest of what I call the big three wireless guys—AT&T and T-Mobile are a little bit smaller, not much. But that’s a business where nobody’s market share ever moves a lot. Someone might pick up a point from someone else, a little turn here and there, but yeah, they stay pretty consistent. You’re right.
Same thing, though. I think a 6.33% yield, great cash flow, great brand, not going anywhere. Just so you know, if oil hits 110, 120, I’m starting to look at some equities, but I’m looking at equities that trade in a narrow range, have tremendous cash flow, an ironclad balance sheet, and guys who can buy back stock and pay out big dividends between now and eternity.
Right. And you’re exactly right. Those are two solid companies that are going nowhere. Would they get hit in a stock market crash? Sure. But they’d come right back because demand won’t go anywhere.
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Austin Smith is a financial publisher with over two decades of experience as an investor, analyst, and advisor. He covers stocks, ETFs, Artificial intelligence and personal finance for 24/7 Wall St. Previously, he spent over a decade at The Motley Fool as a senior editor for Fool.com, portfolio advisor for Millionacres, and launched The Ascent to help reader take control of their personal finances.
His work has been featured on Fool.com, NPR, CNBC, USA Today, Yahoo Finance, MSN, AOL, Marketwatch, and many other publications. He is as an advisor to private companies, and co-hosts The AI Investor Podcast with Eric Bleeker.
When not looking for investment opportunities, he can be found skiing, running, or playing soccer with his children. Learn more about Austin's investment approach here.
