Investing

7 Blue Chip Sin Stocks Can Deliver Huge Passive Income

Lee Jackson

Published: April 27, 2024 7:36 am

Almost regardless of what happens these days, the market pushes higher. Interest rates will stay higher for longer; no problems. Energy and other prices are skyrocketing. Buy the dips and forge ahead. The Southern border is open, and the administration is allowing unvetted illegals into the country no sweat. 

The gains have continued almost unabated thanks to 15 years of excess central bank-provided liquidity, a massive increase in retail trading volume, and the constant flow of money into passive index and exchange-traded funds. The top stocks that influence the indices keep pushing everything higher.

One of the categories of Wall Street that some portfolio managers don’t want to discuss in their portfolios is the so-called “Sin Stocks.” These are companies that sell tobacco and alcohol products, run gambling casinos, sex-related industries, weapons manufacturers, and now even marijuana producers. While they don’t all seem sinful at the margin, some money management companies refuse to own them.

Investors should realize that many of these companies pay significant and dependable dividends, which can translate into solid, reliable passive income. Most dividend investors seek solid passive income streams of quality dividend stocks. Passive income is a steady stream of unearned income that doesn’t require active traditional work. Shared ideas for earning passive income include investments, real estate, or side hustles.

We screened our 24/7 Wall St. dividend stock research database looking for reliable dividend-paying stocks and found seven that meet the criteria. 

Altria

Source: Mario Tama / Getty Images

This maker of tobacco products offers value investors a great entry point now and a rich 9.54% 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 and snus products under the Copenhagen, Skoal, Red Seal, and Husky brands
• on! Oral nicotine pouches.

It sells its tobacco products primarily to wholesalers, including distributors and large retail organizations, such as chain stores.

Altria owns over 10% of Anheuser-Busch InBev (NYSE: BUD), the world’s largest brewer. Last week, the company announced it would sell 35 million of its 197 million shares through a global secondary offering. 

British American Tobacco

Source: Getty Images/Justin Sullivan

This European giant continues to print money and pays a massive 10.54% dividend.

British American Tobacco plc (NYSE: BTI) offers:

• Vapor
• Tobacco heating
• Modern oral nicotine products
• Combustible cigarettes
• Traditional oral products, such as snus and moist snuff

The company offers its products under:

• Vuse,
• Glo
• Velo
• Grizzly
• Kodiak
• Dunhill
• Kent
• Lucky Strike
• Pall Mall
• Rothmans
• Camel
• Natural American Spirit
• Newport
• Vogue
• Viceroy
• Kool
• Peter Stuyvesant
• Craven A
• State Express 555 
• Shuang Xi brands

Constellation Brands

Source: monticelllo / Getty Images

If there is any company whose products stay in style, it’s this one, which pays a 1.67% dividend. Constellation Brands Inc. (NYSE: STZ), together with its subsidiaries, produces, imports, markets, and sells beer, wine, and spirits in the United States, Canada, Mexico, New Zealand, and Italy.

The company provides beer primarily under these popular brands:

• Corona Extra
• Corona Premier
• Corona Familiar
• Corona Light
• Corona Refresca
• Corona Hard Seltzer
• Modelo Especial
• Modelo Negra
• Modelo Chelada
• Victoria
• Vicky Chamoy
• Pacifico

It also offers wine under:

• Cook’s California Champagne
• Kim Crawford
• Meiomi
• Mount Veeder
• Ruffino
• SIMI
• My Favorite Neighbor
• Robert Mondavi Winery
• Schrader
• The Prisoner Wine Company

Spirits are sold under the Casa Noble, Copper & Kings, High West, Mi CAMPO, Nelson’s Green Brier, and SVEDKA brands.

Diageo plc

Source: Anton_Ivanov / Shutterstock.com

Diageo plc (NYSE: DEO) is one of the largest producers of alcoholic beverages in the world and pays a solid 2.86% dividend. It produces, markets, and sells alcoholic beverages worldwide.

It offers:

• Scotch whiskey
• Gin,
• Vodka
• Rum
• Beer and spirits
• Irish cream liqueurs
• Wine
• Raki
• Tequila,
• Canadian and American whiskey
• Cachaça, and brandy, as well as adult beverages and ready-to-drink products

The company’s premium brands comprise Johnnie Walker, Smirnoff, Captain Morgan, Baileys, Tanqueray, and Guinness.

Its reserve brands include:

• Johnnie Walker Blue Label
• Johnnie Walker Green Label
• Johnnie Walker Gold Label 18-year-old
• Johnnie Walker Gold Label Reserve
• Johnnie Walker Platinum Label 18-year-old
• John Walker & Sons Collection
• Johnnie Walker The Gold Route
• Johnnie Walker The Royal Route
• Johnnie Walker super premium brands; The Singleton, Cardhu, Talisker, Lagavulin, and other malt brands

L3 Harris Technologies

Source: JHVEPhoto / iStock Editorial via Getty Images

This off-the-radar giant may be the best total return candidate of all and pays a 2.30% dividend. L3 Harris Technologies (NYSE: LHX) provides mission-critical solutions worldwide for government and commercial customers.

The company’s Integrated Mission Systems segment provides intelligence, surveillance, and reconnaissance (ISR) systems, passive sensing and targeting, electronic attack, autonomy, power and communications, networks and sensors, and advanced combat systems for air, land, and sea sectors.

Its Space and Airborne Systems segment offers space payloads, sensors, and full-mission solutions; classified intelligence and cyber; mission avionics; electronic warfare systems; and mission networks systems for air traffic management operations.

The company’s Communication Systems segment provides:

• Broadband communications
• Tactical radios
• Software
• Satellite terminals
• End-to-end battlefield systems for the U.S. Department of Defense, international, federal, and state agency customers
• Integrated vision solutions, including helmet-mounted integrated night vision goggles with leading-edge image intensifier tubes and weapon-mounted sights, aiming lasers, and range finders; and public safety radios, and system applications and equipment

Its Aerojet Rocketdyne segment provides propulsion technologies and armament systems for strategic defense, missile defense, hypersonic and tactical systems, and space propulsion and power systems for national security and space and exploration missions.

Lockheed Martin

Source: y / iStock Editorial via Getty Images

This company is one of the top aerospace and defense stocks to buy, has backed up nicely from the highs, and pays a dependable 2.76% dividend. Lockheed Martin Corporation (NYSE: LMT) researches, designs, develops, manufactures, integrates, operates, and sustains advanced technology systems, products and services.

The Company operates in five principal business segments:

• Aeronautics
• Missiles and Fire Control
• Mission Systems and Training
• Space Systems
• Information Systems and global Solutions (IS&GS).

It also provides a wide range of defense electronics products and IT services.

As the Pentagon’s prime contractor, Lockheed Martin plays a crucial role in national defense, offering a diverse portfolio of global aerospace, defense, security and advanced technologies. Its leveraged presence in the Army, Air Force, Navy and IT programs guarantees a steady inflow of follow-on orders, not only from the U.S. government but also from a large number of foreign allies of the nation.

VICI Properties

Source: RudyBalasko / iStock Editorial via Getty Images

This is the top pick across Wall Street in the net lease group and is ideal for more conservative investors looking for gaming exposure that pays a large 6.10% dividend. VICI Properties Inc. (NYSE: VICI) is a triple net lease real estate investment trust (REIT) that was spun out of Caesars Entertainment after its bankruptcy, offering a stable and secure investment option.

VICI Properties is an S&P 500 experiential real estate investment trust that owns one of the largest portfolios of market-leading gaming, hospitality, and entertainment destinations, including three of the most iconic entertainment facilities on the Las Vegas Strip:

• Caesars Palace Las Vegas,
• MGM Grand
•  Venetian Resort Las Vegas

The company owns 93 experiential assets across a geographically diverse portfolio of 54 gaming properties and 39 other experiential properties across the United States and Canada. The portfolio comprises approximately 127 million square feet and features approximately 60,300 hotel rooms and over 500 restaurants, bars, nightclubs, and sportsbooks.

Its properties are occupied by industry-leading gaming, leisure, and hospitality operators under long-term, triple-net lease agreements. VICI Properties has a growing array of real estate and financing partnerships with leading operators in other experiential sectors, including:

• Bowlero
• Cabot
• Canyon Ranch
• Chelsea Piers
• Great Wolf Resorts
• Homefield
• Kalahari Resorts

VICI Properties also owns four championship golf courses and 33 acres of undeveloped and underdeveloped land adjacent to the Las Vegas Strip. VICI Properties’ goal is to create the highest quality and most productive experiential real estate portfolio through a strategy of partnering with the highest quality experiential place makers and operators.