You don’t have to trade options to have a big portfolio by the time you retire. Patiently accumulating shares of reliable retirement stocks can put you in a good position by the time you walk away from your career. Retirement stocks can also supplement your income if you don’t plan on retiring or prefer to work part-time in the future.
Granted, some retirement stocks offer better margins of safety than others. These retirement stocks offer cash flow, reasonable valuations and the potential to generate positive long-term returns.
Meta Platforms (META)
Many big tech companies are still growing and gaining market share while rewarding long-term shareholders. While Meta Platforms (NASDAQ:META) has been great at initiating stock buybacks for several years, the company recently announced its first dividend. The yield is low at 0.44%, but investors should expect a high dividend growth rate for the first few years.
The social media giant’s stock has outperformed many firms. It’s up by 30% year-to-date (YTD) and has gained 131% over the past five years. Despite the big rally, Meta Platforms only trades at a 26 P/E ratio. Its net income continues to soar and suggests the valuation can get much better.
Meta Platforms reported 117% year-over-year (YOY) net income growth in Q1 2024. Revenue growth also came in strong at 27% YOY. The company’s social networks continue to attract new users, and it’s making more money from advertisers. Meta Platforms looks like it has a tremendous runway in 2024 and beyond.
Caterpillar (CAT)
The construction industry is a vital component of the economy. Homes, commercial buildings and roads need regular maintenance. Construction companies also have to build new ones.
Many construction firms use Caterpillar’s (NYSE:CAT) equipment to work on these projects. The company’s iconic yellow equipment and its predecessors have been a focal point of the construction industry for almost 100 years. Caterpillar has withstood the Great Depression and other economic challenges while delivering value for shareholders.
The stock currently trades at a 15 P/E ratio and offers a 1.55% dividend yield. Shares are up by 15% YTD and have soared by 141% over the past five years. Adjusted profit per share rose from $4.91 per share to $5.60 per share in Q1 2024. The firm allocated $5.1 billion toward stock buybacks and dividend distributions in the first quarter. Caterpillar has delivered an annualized dividend growth rate of 8.04% over the past decade.
Stag Industrial (STAG)
Stag Industrial (NYSE:STAG) is a real estate investment trust that specializes in industrial properties. The firm has 570 buildings spread across 41 states and consists of a combined 113.0 million square feet. The REIT delivers monthly dividend distributions to its investors and currently has a 4.20% yield.
Stag Industrial isn’t the type of stock that outperforms the market. It’s only up by 19% over the past five years. But investors also have to factor in the high yield and dividend reinvestments. The firm reported good results in Q1 2024. Core funds from operations per diluted share increased by 7.3% YOY.
Most of Stag Industrial’s clients can’t walk away from their leases without a significant impact on their business. It’s one of the last expenses most companies will cut. That’s why Stag Industrial achieved a 97.7% occupancy rate for its portfolio. Stag Industrial generates high cash flow for its shareholders while delivering value.
On the date of publication, Marc Guberti 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.
