The company has increased its distributions 120% in the past 10 years, from 32.5 cents per share in 2004 to 72.5 cents today. And to support future dividend growth, Ventas is also gobbling up smaller competitors; this REIT has made eight major acquisitions over the past decade that total over $16 billion, in order to ensure future growth.
These are also high-quality purchases, with so-called “triple-net” leases that mean tenants, not Ventas, are obligated to pay for any property-related expenses like taxes, maintenance and insurance. That’s a good business to be in long term.
The second healthcare REIT I like is HCP Inc. (HCP). HCP stock is up 16% year-to-date, but still boasts a 5.2% dividend yield. The company is one of our Dependable Dividend Stocks and has raised its payouts steadily every year since 1985!
HCP leases or owns space for senior housing facilities, medical offices and even hospitals. So in addition to the aging Baby Boomer demographic creating a tailwind, the advent of Obamacare insuring more “customers” for healthcare-related businesses means that HCP is one of the best dividend stocks with a bright outlook for both now and the future.
The last stock I like is the aptly named Health Care REIT (HCN). This real estate investment trust has range of medical properties that it manages, including medical centers as well as senior housing facilities. And like Ventas, many of these locations are triple-net leases that keep HCN upkeep obligations low.
HCN stock is up 19% this year, but still boasts a roughly 5.0% dividend after the run.
If you’re looking for the best dividend stocks for 2014 and beyond, start with healthcare REITs like the ones above. Not only are these picks rising this year, they also have great long-term potential for both share price appreciation and high dividend increases down the road.
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Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor’s Guide to Finding Great Stocks. As of this writing, he did not hold a position in any of the aforementioned securities. Write him at firstname.lastname@example.org or follow him on Twitter via @JeffReevesIP.