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3 Top Retirement Stocks For Reliable Dividends

  • These retirement stocks offer excellent dividend payouts that can form the basis of consistent and reliable income for retirees.
  • Verizon Communications (VZ): The leading U.S. wireless provider has a growing dividend yield.
  • Chevron (CVX): An oil major that offers share price gains and a great dividend.
  • Coca-Cola (KO): A reliable blue-chip with has a history of rewarding shareholders.
retirement stocks an older couple sitting on a dock and looking at a pamphlet
Source: Shutterstock

Dividends are an important part of shareholder compensation and can greatly increase the value of owning stock in a company. And that makes them attractive when people are considering retirement stocks.

That’s because over time, dividend payments can add up and help with the compounding that occurs with holding stocks long term.

Dividends are also a sign of financial health at a company. Profitable and growing companies are able to steadily increase their annual dividend payouts to shareholders. As such, most investment professionals encourage people to factor in dividend payments when calculating the total return they receive from owning a particular stock.

All in all, dividends can be a reliable source of income for retirees, depending on the size of a position held. Here are three top retirement stocks that pay consistent and reliable dividends.

Ticker Company Current Price
VZ Verizon Communications Inc. $49.04
CVX Chevron Corporation $173.01
KO The Coca-Cola Company $65.96

Retirement Stocks: Verizon Communications (VZ)

5G stocks
Source: Ken Wolter / Shutterstock.com

Verizon Communications (NYSE:VZ) has a lot to recommend it, including a dividend yield of 5.3%, or 64 cents a share, making it one of the best quarterly payouts. The leading provider of wireless internet in the U.S. is leading the charge when it comes to the national rollout of fifth generation (5G) service.

And the company recently announced a $5 billion deal to sell its AOL and Yahoo assets, infusing it with more cash and enabling it to focus on its core wireless business.

Year to date, VZ stock has fallen only 8%. That decline is much better than the drop in the Nasdaq composite, which is currently sitting deep in bear market territory. Verizon’s competitive position, valuation, and dividend payment attracted famed investor Warren Buffett, whose  Berkshire Hathaway (NYSE:BRK.A, NYSE:BRK.B) holding company took a stake in Verizon in the fourth quarter of 2020, making the company one of its 10 biggest positions.

Chevron (CVX)

Chevron (CVX) logo on blue sign in front of skyscraper building
Source: Jeff Whyte / Shutterstock.com

Speaking of Warren Buffett, the stock he has been buying the most of lately has been oil major Chevron (NYSE:CVX). The Oracle of Omaha grew his investment in Chevron during the first quarter of this year to $25.9 billion from $4.5 billion at the end of the fourth and final quarter of 2021.

Any why not? With oil prices at multi-year highs, CVX stock has outperformed this year, up 40% since January. If that weren’t impressive enough, Chevron also pays a quarterly dividend yield of 3.4%, or $1.42 per share.

Chevron’s conservative financial management, size, and low-cost resource base have helped the San Ramon, California company raise its dividend payout for 33 consecutive years now, making it a dividend aristocrat. While the energy sector remains volatile, Chevron’s strong dividend payments help to cushion the blow for shareholders.

Plus, energy prices are forecast to remain elevated throughout the remainder of this year with no end insight to the war in Ukraine.

Retirement Stocks: Coca-Cola (KO)

a line of Coca-Cola (KO) cans
Source: MAHATHIR MOHD YASIN / Shutterstock.com

Atlanta-based beverage giant Coca-Cola (NYSE:KO) is also a favorite holding of Buffett, and it too pays an impressive quarterly dividend. Currently, Coke’s dividend yield is 2.7%, which equates to 44 cents per share each quarter.

This year marked a milestone for Coca-Cola as the company announced in February that its board approved the company’s 60th consecutive annual dividend increase, raising the quarterly dividend by 5%.

In addition to the dividend payout, Coca-Cola remains a rock solid blue-chip company that is profitable and continues to deliver a string of impressive financials results. For this year’s first quarter, Coca-Cola reported earnings per share of 64 cents versus 58 cents that analysts expected. Revenue came in at $10.5 billion compared to $9.83 billion forecast by analysts.

On the date of publication, Joel Baglole held a long position in BRK.B. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.  

Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.

Article printed from InvestorPlace Media, https://investorplace.com/2022/05/3-top-retirement-stocks-for-reliable-dividends/.

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