In a market like this, most people aren’t hunting for income stocks. Instead, they’re looking for hot stocks with turbocharged growth potential.
Now, that’s fine for part of your portfolio. But a well-balanced portfolio also needs stocks that are able to win the slow and steady long-term race. Those picks make it a point to reward investors every quarter with some cash.
Plus, when it comes to a major bull market (like the one we’re in), it’s important to remember that the market doesn’t always perform this well. There are times when you just want names that can work in all weather. Usually those are the market’s actual hot stocks.
So, these seven names with 3%-plus yields are the kind of quality picks you want anchoring your portfolio when the broader rally slows. That’s when they will really shine, delivering solid growth quarter after quarter.
- Abbvie (NYSE:ABBV)
- Broadcom (NASDAQ:AVGO)
- Coresite Realty (NYSE:COR)
- Flowers Foods (NYSE:FLO)
- General Mills (NYSE:GIS)
- NextEra Energy Partners (NYSE:NEP)
- J.M. Smucker (NYSE:SJM)
Humira is one of the world’s most successful drugs and Abbvie makes it. But that isn’t what makes this compelling pick one of the hot stocks. Instead, it’s all the other approved medications that ABBV has on the market and in its huge pipeline.
Usually, drug companies can live off of a blockbuster drug for a while, but eventually pricing gets lower and competitors enter the market, eating into margins. That’s why one great drug doesn’t make a great drug company.
On top of that, the average cost of developing a drug candidate is around $2.6 billion when all is said and done. So, as a drug maker, you want to make sure you’re developing a good candidate and that you have deep enough pockets to keep several clinical trials going at once.
Abbvie is able to accomplish all of this. And, its track record is very good.
Finally, ABBV stock wasn’t in on the vaccine frenzy, so it’s still a value buy. Plus, with all the cash flow from its array of products, it delivers a reliable 4.85% dividend. The stock is up over 20% in the past year to boot.
If you’re searching for a tech firm that isn’t wildly overvalued at this point, AVGO stock may be just what you’re looking for.
Right now, this name is trading at a trailing price-earnings of 70.4, so it’s not exactly cheap here. But the fact is, AVGO has a lot going for it in many different sectors. That’s because it’s a chipmaker that also sells hardware and software for mainframes, networking, optical processing, wired connectivity and wireless sectors.
What’s more, the company has been around in one form or another since 1961. It has built a significant reputation in the industry and continues to be a strong player, even with the explosion of tech in recent decades. That’s a testament to Broadcom’s leadership and ability to stay on the cutting edge in a highly competitive market.
Currently, AVGO stock is up about 49% in the past one year and growth should continue to be brisk given the strategic sectors it dominates. This pick of the hot stocks also has an attractive 3.23% dividend, even after all that growth.
Coresite Realty (COR)
Next on my list of hot stocks is Coresite Realty. If you’re looking for a real estate investment trust (REIT) to add to your portfolio, look no further than COR stock.
Coresite isn’t the biggest data-center REIT out there, but it is U.S.-focused and well-positioned for growth in one of the most important sectors today. Now that “smart” devices have come to even include the lowly doorbell, managing all that data is crucial to businesses.
COR supplies the data centers that make that happen, whether for mobile connectivity, server farms or cloud providers. Plus, it offers colocation services where two or more companies can operate in one site and connect to one another. Coresite simply builds out the locations and collects the rent.
Right now, the stock is only up about 4% in the past year, so it didn’t get sucked into the tech stock buying frenzy. However, that’s a good thing. The company still has plenty of long-term value and its 4.16% dividend is making you a lot more than a savings account.
Flowers Foods (FLO)
You probably haven’t heard of Flowers Foods, but I’m sure you’ve heard of some of its bakery brands. These include Wonder Bread, Nature’s Own, Dave’s Killer Bread and Tastykake, among others. The company produces these names from over 40 different bakeries across the country.
And, whether it’s a pandemic or simply a seasonal storm, bakery items are essential products for pretty much every home. That’s why the bread company even makes its popular Mi Casa tortilla brand.
FLO is one of largest bakery companies in the United States. However, it keeps a low profile and lets its products do all the talking. With over 100 years in the business, Flowers has a solid portfolio of brands and manages its business well.
Currently, FLO stock is up a little under 2% in the past year, having been overlooked by many investors. But, this pick of the 0ven-hot stocks offers a rock-solid 3.62% dividend.
General Mills (GIS)
If you’re looking for a big, blue-chip consumer food company that has a 155-year history, look no further than General Mills. While consumer staples companies have been hot stocks during the pandemic, the food side of things hasn’t moved much.
But that’s to our advantage. GIS maintains an impressive portfolio of roughly 90 brands that even you probably grab at the grocery store, including Yoplait, Betty Crocker, Pillsbury and Cheerios.
The trick with managing all of these brands is staying on top of the consumer, seeing what they’re buying and what they’re leaving behind. General Mills has done an extremely good job of this, making it a great investment.
In short, this name is a global player that is well-positioned and well-priced right now. GIS stock is up about 8% in the past year and delivers a 3.62% dividend. Yet, it trades at a trailing price-earnings of roughly 14.5. That makes it a steal right now.
NextEra Energy Partners (NEP)
NextEra Energy Partners is a subsidiary of the renewable energy and utility powerhouse NextEra Energy (NYSE:NEE), one of the more recognizable hot stocks on the market right now.
NEE is one of the world’s largest producers of renewable energy and it sells to NEP as well as its south Florida utility subsidiary, Florida Power & Light (FPL). Additionally, there are various pieces to the larger company — for instance, NEP manages much of the electricity generated from NEE’s wind farms.
Fundamentally, NEP is a specialized company that is set up as a limited partnership. That means investors get a share of the net profits distributed to them as dividends. And, of course, the company is much smaller than its parent due to its specialized role. However, it reaps the rewards of that parent all the same.
NEP stock is up about 50% in the past year and still offers a dividend yield of 2.98%. That’s just on the other side of 3% and is due to the stock’s significant performance. So, NEP is a long-haul stock that will eventually move on to pay an above average dividend.
J.M. Smucker (SJM)
Closing my list of hot stocks is another consumer food company with more than a century of business under its belt — 124 years to be exact.
While many of its contemporaries have grown into multinational empires with scores of brands, J.M. Smucker has taken a different approach. Unlike competitors, SJM focuses on the U.S. market and tries to own brands that are the pinnacle of their categories.
The company’s more than 40 product names include Smucker’s, Jif, Folgers, Milk Bone and Carnation, to name a few. This kind of focus means it can keep its iconic brands fresh and also cherry pick the best up-and-coming names. Admittedly, the strategy is a little conservative, but it has worked a long time.
Right now, SJM stock is up over 11% for the past year. On top of that, it shares a very friendly and reliable 3.1% dividend.
On the date of publication, Louis Navellier had positions in NEE, ABBV and AVGO. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
Louis Navellier had an unconventional start, as a grad student who accidentally built a market-beating stock system —with returns rivaling even Warren Buffett. In his latest feat, Louis discovered the “Master Key” to profiting from the biggest tech revolution of this (or any) generation.