Investors have different objectives. The closer you are to retirement, dividend income might rank higher on your goals.
Many dividend stocks do not provide that much income every year. However, some can help you considerably during your retirement. Investing $100,000 among these two dividend stocks might give you added income close to $5,770 per year.
1. Devon Energy
You won’t find a stock in the S&P 500 that gives a higher dividend than Devon Energy. Investing one-half of your $100,000 should make you around $3,330 in annual dividends — and maybe even more.
There is one catch with Devon’s dividend. Only some of the this distribution is fixed. Most of it is variable and dependent on the 50% payout from the company’s excess free cash flow. It is possible that your yearly income can be lower in the future than now.
However, Devon’s close-term future looks great. The market seems to be early in another energy upcycle. The firm’s assets might deliver strong free cash flow with oil going higher than they have been in recent years.
You can also be assured that the company is committed to paying a dividend. The company has given dividends for 28 years in a row. It has also boosted its dividend by a compound yearly growth rate of more than 10% since 1993.
2. Enterprise Products Partners
Enterprise Products Partners does not have any catches with the company’s dividend. The midstream energy firm’s dividend yield currently is around 7.3%. If add another half of your $100,000 to purchase shares of Enterprise, you would get income of around $2,440 per year.
Like Devon, Enterprise Products Partners puts a high priority on its dividend paying. The firm has boosted its distribution for 22 consecutive years. The dividend compound yearly growth rate during this time was around 7%.
You just may get impressive share appreciation in addition to the nice income by investing in this company. Wall Street believes the stock might jump over 15% over the incoming 12 months.
What about the move away from fossil fuels to more renewable energy sources? That is almost certainly an unstoppable trend. However, Enterprise’s management thinks the lower-emission natural gas and liquids, and lower-sulfur oil at its core profits will stay a key source of energy production for a very long time. The company’s dividend payments should not face serious threats of disruption in the years to come.
Author: Steven Sinclaire