3 High-Yield Dividend Growth Stocks to Buy in December and Hold for a Decade or Longer

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It’s been a great couple of years for the stock market. From the end of 2022 through Nov. 29, the benchmark S&P 500 (SNPINDEX: ^GSPC) index rose a whopping 57.1% higher.

During this bull run, stock prices have bounded forward much further than earnings from their underlying businesses. As a result, the average dividend payer in the benchmark index offers a paltry 1.2% yield at recent prices.

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It’s a lot harder for income-seeking investors to find high-yield dividend stocks to buy these days, but it’s not impossible. Shares of Brookfield Infrastructure (NYSE: BIP)(NYSE: BIPC), AbbVie (NYSE: ABBV), and Royalty Pharma (NASDAQ: RPRX) offer yields above 3% at recent prices. In addition to high yields at the moment, there’s a good chance these dividend payers can crank up their payouts a lot further before you’re ready to retire.

The overall economy tends to grow over time, but predicting which industries will grow fastest is risky. That said, just about all industries need infrastructure. With this in mind, we can reasonably assume the amount of energy, data, water, and freight that Brookfield Infrastructure transports and stores will continue rising along with its dividend payout.

There are two ways to invest in this high-yield dividend payer. Brookfield Infrastructure Corp. (BIPC) shares offer an attractive 3.6% dividend yield. If you’re prepared for the complex tax implications that come with owning shares of a master limited partnership, Brookfield Infrastructure Partners (BIP) trades at a lower price and offers a much larger 4.6% yield.

This February, Brookfield Infrastructure increased its quarterly dividend payout for the 15th consecutive year. The company raised its payout by 6% this year, and investors can reasonably look forward to at least another decade of significant payout raises.

Brookfield Infrastructure reported funds from operations, a proxy for earnings, that rose to $2.31 per share during the first nine months of 2024. That’s heaps more than it needs to support a payout currently set at $1.62 per share annually.

Did you know Americans spent $405.9 billion on prescription drugs in 2022? That was 8.4% higher than the previous year, and it wasn’t an anomaly. Steadily rising prescription drug sales are a reliable trend that income-seeking investors can follow all the way to the bank.

AbbVie is one of the more attractive dividend-paying stocks in the pharmaceutical industry, with a 3.6% yield at recent prices. It’s also one of its industry’s fastest dividend raisers. Since splitting from Abbott Laboratories in 2013, it’s more than quadrupled its payout.

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