Over the years, the typical duration Wall Street investors hold onto stocks has decreased significantly. Today, maintaining a stock for as long as a decade feels almost unheard of. However, being a small investor comes with a unique advantage: you can hold assets for extended periods without the pressure of constant performance scrutiny.
Investors can consider stable yet high-yield stocks such as Realty Income (O -0.24%), dividend growth stocks like Brookfield Asset Management (BAM -0.18%), or struggling Dividend Kings like Target (TGT 1.83%), which are attempting to turn their fortunes around over several years. All three of these high-yield investment opportunities merit your attention today.
1. Realty Income: Stable Yet Rewarding
Realty Income is recognized as the largest net lease real estate investment trust (REIT), owning single-tenant properties where tenants are mostly responsible for operational costs. With an extensive portfolio of over 15,600 properties, its assets are diversified across retail and industrial sectors in North America and Europe. While its slow growth can be frustrating, the benefits of such a substantial portfolio afford Realty Income access to capital markets, enabling deals that smaller competitors cannot manage. For conservative income investors, its 5.6% dividend yield—supported by a strong balance sheet—has been increased annually for three decades, making it an attractive option for a long-term hold.
2. Brookfield Asset Management: Rapid Dividend Growth
Brookfield Asset Management ranks among Canada’s largest asset managers, though it remains smaller than many U.S. counterparts. Currently, it offers a yield of about 3.1%. Recently, its dividend was raised by an impressive 15%, and management anticipates sustaining this growth through at least the decade’s end. Brookfield’s strategy revolves around accumulating assets, aiming to double its $550 billion in fee-generating assets to $1.1 trillion by decade’s close. With operations in renewable energy, infrastructure, real estate, private equity, and credit, the potential for growth is substantial, driven primarily by its fast-growing dividends.
3. Target: A History of Dividends and a Promising Future
As one of the largest U.S. retailers, Target competes with Walmart, offering a slightly more premium shopping experience. With 58 consecutive years of dividend increases, Target has earned the title of a Dividend King, highlighting its robust business model. Currently, its dividend yield is around 4.6%. However, recent challenges with consumer engagement have impacted sales compared to Walmart’s value proposition. Target is restructuring its management to steer the business back on track. Long-term investors looking to benefit from potential turnaround strategies can expect generous compensation through dividends during the wait.
A Diverse Selection of High-Yield Stocks
Realty Income offers a robust, dependable yield for income seekers. Brookfield Asset Management presents an exciting opportunity for dividend growth enthusiasts, while Target, with its excellent dividend history and potential for recovery, appeals to those interested in turnaround investments. Each of these high-yield options could be a valuable addition to a diverse investment portfolio.
Reuben Gregg Brewer holds stocks in Realty Income. The Motley Fool has stakes in and endorses Realty Income, Target, and Walmart, and also recommends Brookfield Asset Management. Please refer to the disclosure policy for more information.
