The stock market recently took a big dip, driven down By worrying about how many rates the economy will influence. One of the benefits of falling stock prices is that dividend yields move in the opposite direction. This enables investors to lock up even higher yields to some high -quality dividend shares.
I recently capitalized on the DIP in the market to use some cash on my pension account to add to my position in various first -class dividend shares, including Vici -Properties (NYSE: VICI)” Verizon (NYSE: VZ)And Real parts company (NYSE: GPC). This is why I think They are shares with a low risk to buy in the midst of the current unrest on the market.
In the midst of the market for the market, the shares of Vici Properties have fallen more than 10% from being recently peak. That has driven upwards The dividend yield of the real estate investment trust (Trawl) to 5.7%, well above the S&P 500S 1.5% yield.
The high -productive payment of the Reit is on a very safe foot. It produces terribly stable cash flow of his portfolio of High-quality experiential real estate, such as casinos and sports and entertainment complexes.
It hires these properties to operational tenants terribly Triple Net Long -term Rental Contracts (NNNS), who currently have an average remaining period of 41 years. An increasing percentage of his lease contracts for inflation (42% this year, rises to 90% by 2035). That is why it generates terribly Stable and growing rental income.
Vici has property a very strong one Financial profile that gives the flexibility to continue to invest in income -producing experiential real estate. The growing portfolio allows the Reit to increase its dividend. It picked it up seven directly Years (every year since its formation), against a compound annual compound percentage, well above the average annual percentage of 2% of its net lease colleagues.
The shares of Verizon have fallen more than 7% compared to their recent peak. That has pushed the dividend revenue from the telecom giant to 6.3%. That high -productive dividend is super safe.
Verizon produces a lot of Sustainable cash flow if companies and consumers pay their wireless and broadband accounts. The company earned $ 36.9 billion in cash flow from operations last year and $ 19.8 billion in free cash flow (FCF) after financing capital expenditure, which was more than enough to cover his dividend spending of $ 11.2 billion. Verizon used the remaining excess FCF to strengthen his all Rock-Solid balance.
The company used Part of his financial flexibility to acquire Frontier communication In an all-cash deal of $ 20 billion to strengthen its broadband network. That deal and the constant capital investments to grow his fiber and 5G networks organically enable Verizon to grow his income and cash flow in the future.
That should enable the company to continue to increase its dividend, which it has done for a sector-in-law for 18 years in a row.
Real Parts Company was sold strongly during the recent Downdraft of the market, more than 30%fell. That slump pushed the dividend yield of the automotive and industrial partial distributor upwards up to 3.7%.
There are some worries that rates can have a meaningful impact on the automotive sector, given the volume of parts imported into the country. Although this headwind can influence rather, demonstrate his resilience by increasing his dividend for 69 years in a row.
The company has a strong financial profile to support its high -productive dividend in the midst of current market uncertainty. Last year, real parts produced $ 1.3 billion in cash flow from operations and $ 684 million in FCF. That was more than enough to cover the $ 555 million that it paid in dividends.
It has a strong balance with a lot of liquidity ($ 2 billion, including $ 480 million in cash and equivalents). That gives it a lot of Financial flexibility to continue to invest in growing his company and doing acquisitions, including buying independent Napa Auto Parts stores on top markets.
These investments should help to increase his income and cash flow in the long term, which supports the continuous increase in his dividend.
Shares of Vici Properties, Verizon and Real Parts Company fell during the recent sale of the stock market, which pushed their dividend yields even higher. Given the sustainability of their cash flows and the power of their financial profiles, those payouts are very safe. That is why I have capitalized the recent sale to buy even more shares for my pension account to increase the amount of their super -safe income that I will collect in the coming years.
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Matt Dilallo has positions in real parts, Verizon Communications and Vici properties. The Motley Fool recommends real parts, Verizon Communications and Vici properties. The Motley Fool has a disclosure policy.
Buy the dip: 3 super safe high-yield dividend shares that I added to my retirement account during the sale of the stock market. was originally published by the Motley Fool
