While many Baby Boomers have enjoyed a long bull market over the past 35 years, there is a point when income becomes more critical than stock appreciation. The reason is simple: those who leave their careers to enjoy a well-deserved retirement lose the benefits of a regular salary and their jobs, such as 401(k) matching and company-paid healthcare. In addition, many Baby Boomers use their retirement years to travel and enjoy the rewards they have worked hard to achieve throughout their lives. Choosing investments wisely is imperative, and at 24/7 Wall St., we continually seek the best ideas for Baby Boomers and retirees.
Given the recent volatility in oil prices, though whether prices will remain at current levels remains to be seen, and a very weak nonfarm payrolls print for June, the incessant chatter that the Federal Reserve will raise rates is starting to fade. However, the economy, despite the perhaps one-off print in June’s employment data, still seems to be chugging along, and with consumer spending staying strong, new Federal Reserve Chair Kevin Warsh will likely be more than happy to keep interest rates where they are for the rest of 2026 and perhaps 2027 as well.
One thing is for sure: Boomers who need solid passive-income ideas are turning to quality dividend stocks with strong total-return potential. Five of our favorite stocks, which all yield 5% or more, are perfect passive income ideas for Boomers looking to strengthen their overall cash flow, and all are rated Buy by the Wall Street firms we cover. While better suited for investors with a moderately higher risk appetite, all have historically been very strong.
Why do we cover dividend stocks?
Since 1926, dividends have accounted for approximately 32% of the S&P 500’s total return, while capital appreciation has accounted for 68%. Therefore, sustainable dividend income and the potential for capital appreciation are essential to total return expectations. A study by Hartford Funds, in collaboration with Ned Davis Research, found that dividend stocks delivered an annualized return of 9.18% over the 50 years from 1973 to 2023. Over the same timeline, this was more than double the annualized return for non-payers (3.95%).
Energy Transfer
Energy Transfer (NYSE: ET | ET Price Prediction) is one of North America’s largest and most diversified midstream energy companies. This top master limited partnership is a safe option for investors seeking energy exposure and income, as the company pays a 6.65% distribution yield. Energy Transfer owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with a strategic footprint across all major domestic production basins.
The company is a publicly traded limited partnership with core operations that include:
- Complementary natural gas midstream, intrastate, and interstate transportation and storage assets
- Crude oil, natural gas liquids (NGL), and refined product transportation and terminalling assets
- NGL fractionation
- Various acquisition and marketing assets
Following the acquisition of Enable Partners in December 2021, Energy Transfer owns and operates over 114,000 miles of pipelines and related assets in 41 states, spanning all major U.S. producing regions and markets. This further solidifies its leadership position in the midstream sector.
Through its ownership of Energy Transfer Operating, formerly known as Energy Transfer Partners, the company also owns Lake Charles LNG; the general partner interests, the incentive distribution rights, and 28.5 million standard units of Sunoco (NYSE: SUN); and the public partner interests and 39.7 million standard units of USA Compression Partners (NYSE: USAC).
Jefferies has a Buy rating with a $23 target price.
EPR Properties
This real estate investment trust (REIT) invests in some of the most popular entertainment companies and was the newest addition to the J.P. Morgan Equity Analysts Focus List. EPR Properties (NYSE: EPR) is a leading experiential net-lease real estate investment trust specializing in select enduring experiential properties and pays a 5.91% dividend. It recently increased its monthly dividend by 5.1% and expects FFO per share growth of more than 5% in 2026, supporting continued dividend increases. After suspending its dividend during COVID, it has recovered with 5 consecutive years of increases. Its $6.9 billion property portfolio generates solid cash flow, and the monthly dividend of $0.31/share is well-covered by funds from operations.
J.P. Morgan gave this brief reason for adding the shares: “High dividend yield >6% that we see as safe and growing, with earnings growth likely to be toward the top of the net-lease REIT peer group.”
The company operates through two segments. The Experiential segment consists of approximately:
- 148 theater properties
- 59 eat and play properties
- 25 attraction properties
- 11 ski properties
- Four experiential lodging properties
- One gaming property
- One cultural property
- 22 fitness and wellness properties
The Education segment comprises 46 early childhood education centers and nine private schools.
EPR Properties’ investment portfolio includes ownership of and long-term mortgages on experiential and educational properties. The company has investments in approximately 44 states. All the company’s owned single-tenant properties are leased on long-term, triple-net terms.
The J.P. Morgan price target is $62.
Pfizer
Pfizer (NYSE: PFE) was established in 1849 in New York by two German entrepreneurs. This top pharmaceutical stock was a massive winner in the COVID-19 vaccine sweepstakes, but it has been crushed as many people have not received boosters. However, Pfizer’s recovery story is gaining traction, with blockbuster non-COVID drugs delivering strong growth and a potential GLP-1 product launch on the horizon.
Pfizer discovers, develops, manufactures, markets, distributes, and sells biopharmaceutical products worldwide. It pays a dependable 6.93% dividend, which has increased annually for the past 15 years. The company offers medicines and vaccines in various therapeutic areas, including:
- Cardiovascular, metabolic, and women’s health under the Premarin family and Eliquis brands
- Biologics, small molecules, immunotherapies, and biosimilars under the Ibrance, Xtandi, Sutent, Inlyta, Retacrit, Lorbrena, and Braftovi brands
- Sterile injectable and anti-infective medicines and oral COVID-19 treatment under the Sulperazon, Medrol, Zavicefta, Zithromax, Vfend, Panzyga, and Paxlovid brands
Pfizer also provides medicines and vaccines in various therapeutic areas, such as:
- Pneumococcal disease, meningococcal disease, and tick-borne encephalitis
- COVID-19 under the Comirnaty/BNT162b2, Nimenrix, FSME/IMMUN-TicoVac, Trumenba, and the Prevnar family brands
- Biosimilars for chronic immune and inflammatory diseases under the Xeljanz, Enbrel, Inflectra, Eucrisa/Staquis, and Cibinqo brands
- Amyloidosis, hemophilia, and endocrine diseases under the Vyndaqel/Vyndamax, BeneFIX, and Genotropin brands
BMO Capital has an Outperform rating with a $34 target price.
Verizon
Verizon Communications (NYSE: VZ) is an American multinational telecommunications company that continues to offer tremendous value. It trades at 9.13 times its estimated 2026 earnings and yields 6.66%. Verizon provides a range of communications, technology, information, and entertainment products and services to consumers, businesses, and government entities worldwide.
Verizon’s trailing 12-month interest coverage ratio is 4.6× to 5×, providing ample cushion for dividend payments. With a highly predictable revenue stream from telecom services, the company has limited exposure to commodity cycles. Additionally, its large scale helps finance and absorb market shocks.
It operates in two segments. The Consumer segment provides wireless services across the United States through Verizon and TracFone networks, as well as through wholesale and other arrangements. It also provides fixed wireless access (FWA) broadband through its wireless networks and related equipment and devices, such as:
- Smartphones
- Tablets
- Smartwatches
- Other wireless-enabled connected devices
The segment also offers wireline services in the Mid-Atlantic and northeastern United States through its fiber-optic network, Verizon Fios product portfolio, and copper-based network.
The Business segment provides wireless and wireline communications services and products, including:
- FWA broadband
- Data
- Video and conferencing
- Corporate networking
- Security and managed network
- Local and long-distance voice
- Network access services
And it delivers a range of IoT services and products to businesses, government customers, and wireless and wireline carriers in the United States and internationally.
Raymond James has an Outperform rating with a $56 target price.
Washington Trust Bancorp
This is an off-the-radar regional bank that offers a strong 6.18% dividend. Washington Trust Bancorp (NASDAQ: WASH) is a holding company of the Washington Trust Company, a state-chartered bank and financial services company.
The company operates through two segments. The Commercial Banking segment includes commercial, residential, and consumer lending activities, including:
- Mortgage banking activities
- Deposit generation
- Cash management activities
- Banking activities, including customer support and the operation of automated teller machines (ATMs)
- Telephone banking
- Internet banking and mobile banking services, as well as investment portfolio and wholesale funding activities
The Wealth Management Services segment includes investment management, holistic financial planning services, personal trust and estate services (including services as trustee, personal representative, and custodian), decedent estate settlement, and institutional trust services, including custody and fiduciary services.
Weiss Ratings has a Buy on the stock with no target price.
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