Despite mixed economic signals, many had foreseen the current stock market correction following its momentous rally over the past year or so. AI tailwinds drove the market to new heights in the first half of the year, but they are now leading the losses. Therefore, a more cautious approach may be warranted, with a focus on the top dividend stocks to buy.
A lot is weighing down the current investing sentiment. You have the Middle East and Ukraine conflict, unsettling global markets, and concerns over global oil supplies. Moreover, if that wasn’t enough, the stickiness in inflation, along with a hot jobs report, points to a further delay in interest rate cuts. Therefore, it’s a precarious situation where investing in the right dividend stocks could be exactly what’s needed.
Dividend Stocks: Innovative Industrial Properties (IIPR)
Investing in the cannabis space has always been risky, but Innovative Industrial Properties (NYSE:IIPR) is one of the few businesses that’s defied that trend. With a focus on financially stable, multi-state cannabis operators, IIPR has established its position as a top real estate investment trust (REIT) in the cannabis niche. Its structure has enabled the REIT to become one of the handful of companies in its industry that are generating profits. Moreover, it focuses on long-term, triple-net leases, ensuring stable cash flows for its business.
Its fundamentals have been excellent over the past several years, with its 5-year average funds-from-operation growth at an impressive 46%. Though its AFFO has slowed down substantially in the past couple of years, it’s still ticking head and shoulders above the market. More importantly for its investors, it has paid a growing dividend over the past six years, yielding over 7.50%. With a 5-year dividend growth rate of 39%, it stands out as one of the few companies offering both high yield and significant dividend growth.
Procter & Gamble (PG)
Procter & Gamble (NYSE:PG) is a giant in the consumer goods realm and one of the best dividend stocks over the past 50 years. It’s part of an elite group of companies that have raised their dividend payouts over the past 50 years, earning them the title of ‘Dividend Kings.’ PG stock yields an impressive 2.51%, increasing its payout over the past 67 years.
It recently wrapped up another solid quarter, with EPS of $1.52, beating estimates by a healthy 11 cents. This marks the fifth straight quarter where it has beaten bottom-line estimates. However, it suffered a shortfall in sales, missing estimates by $240 million to $20.2 billion. Nevertheless, PG remains resilient, especially in North America and a recovering Chinese market.
Furthermore, its management has emphatically revised its forward earnings guidance upwards. It now expects core earnings growth of 10% to 11% for fiscal 2024, up from the previously forecasted 8% to 9%.
Realty Income (O)
Realty Income (NYSE:O) is another top REIT, boasting a massive portfolio of more than 13,000 properties spread across virtually every U.S. state. Its vast footprint underscores its powerful market presence, effectively diversifying its risk. This is shown by the stellar growth rates it has been posting in the past few quarters despite the headwinds. Its most recent quarterly results beat revenue estimates again by $38 million to $1.03 billion, representing an 18% jump from the prior-year period.
Furthermore, its commitment to its shareholders remains as strong as ever. It has earned a distinct reputation for payout dividends every month, yielding an excellent 5.80%. Its solid dividend profile and high occupancy rates are a testament to its enduring demand and resilience. Its clients include some of the biggest companies in the world, including FedEx (NYSE:FDX), B.J.’s (NYSE:BJ), and Dollar Tree (NASDAQ:DLTR), to name just a few.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
