Latest news with #RealtyIncome
Yahoo
3 days ago
- Business
- Yahoo
3 Dirt Cheap Stocks to Buy With $500 Right Now
Key Points Alphabet trades at a much cheaper valuation than its Magnificent Seven peers. Realty Income's low valuation is a big driver of its high dividend yield. Energy Transfer trades at one of the lowest valuations in its peer group. 10 stocks we like better than Alphabet › Following a brief dip earlier this year driven by tariff concerns, the S&P 500 has resumed its rally as those fears faded. As a result, we now find the broad market index fetching nearly 22 times its forward earnings. This level is nearing its highest points in the past quarter-century. Even in today's pricier market, several stocks trade at dirt cheap levels. Realty Income (NYSE: O), Energy Transfer (NYSE: ET), and Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL) stand out as very inexpensive stocks. For anyone with $500 to invest, these stocks make compelling buys right now. An AI bargain Tech titan Alphabet trades at the lowest valuation in the "Magnificent Seven," at around 19 times forward earnings. That's dirt cheap compared with those super growth stocks, which fetch more than 27 times forward earnings. What's holding back Alphabet's valuation? Concerns about AI's impact on its lucrative search business. However, as of the first quarter, AI chatbots have not dented its advertising revenue. Google's search revenue actually climbed 10% in the period, to almost $51 billion. Instead, the company is benefiting from AI. CEO Sundar Pichai stated in the first-quarter earnings release, "Search saw continued strong growth, boosted by the engagement we're seeing with features like AI Overviews, which now has 1.5 billion users per month." The company also recently rolled out its Gemini 2.5 AI model, which "is achieving breakthroughs in performance and is an extraordinary foundation for our future innovation," according to Pichai. The company is also expanding its other businesses, including Google Cloud, YouTube, and others. Alphabet's long-term growth potential makes it look like an especially attractive investment these days. A dirt cheap REIT As a leading real estate investment trust (REIT), Realty Income boasts a diversified portfolio that delivers stable rental income through long-term net leases. Management expects to generate between $4.22 and $4.28 per share of adjusted funds from operations (FFO) this year. With shares of the REIT recently trading below $57, the stock sells for less than 13.5 times its forward earnings. This bargain price is why it offers an attractive dividend yield of more than 5.5%. Rising interest rates have presented some headwinds for REITs such as Realty Income, making it more expensive to borrow money for new investments. Nevertheless, Realty Income continues its steady growth. The company made $1.4 billion worth of acquisitions in the first quarter, enabling it to raise its monthly dividend several times this year. Realty Income projects it will have the financial capacity to invest about $4 billion in portfolio expansion this year. If interest rates fall, which many expect will eventually happen, Realty Income would be able to make even more acquisitions. That would allow it to grow faster, which should boost its valuation. A bottom-of-the-barrel valuation Energy Transfer is one of the country's largest master limited partnerships (MLPs). The midstream company owns a large and diverse portfolio of energy infrastructure assets, such as pipelines, processing plants, storage terminals, and export facilities. Those assets generate stable cash flow, with 90% coming from fee-based structures. Despite its stable cash flow profile, Energy Transfer currently trades at the second-lowest valuation in its peer group. That's a big reasonit boasts a monster 7.5% distribution yield. Other than the fact that the MLP sends investors a Schedule K-1 federal tax form each year, there's no reason for Energy Transfer's discounted valuation. The MLP is in its strongest financial position in history, with a leverage ratio in the lower half of its target range. It also has a low distribution payout ratio, at less than half of its stable cash flow. Meanwhile, it's growing at a solid rate, with a reacceleration expected in 2026 and 2027 as it benefits from a slew of upcoming project completions. The growth from those projects will give it plenty of fuel to continue increasing its high-yielding distribution. Cheap stocks in a pricy market While the S&P 500's valuation is rising to expensive levels, there are still some very reasonably priced stocks out there worth buying. Alphabet, Realty Income, and Energy Transfer currently trade at dirt cheap valuations. With solid growth prospects despite some headwinds, they're great stocks to buy right now for those who have around $500 to invest. Should you invest $1,000 in Alphabet right now? Before you buy stock in Alphabet, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Alphabet wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,056,790!* Now, it's worth noting Stock Advisor's total average return is 1,048% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Matt DiLallo has positions in Alphabet, Energy Transfer, and Realty Income. The Motley Fool has positions in and recommends Alphabet and Realty Income. The Motley Fool has a disclosure policy. 3 Dirt Cheap Stocks to Buy With $500 Right Now was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
4 days ago
- Business
- Yahoo
5 High-Yield Stock Picks to Add to Your Dividend Portfolio
Key Points Verizon and Realty Income may not offer much growth, but their ability to fund growing dividend payments is rock-solid. Pfizer struggled following the wind-down of the coronavirus pandemic, with nothing offsetting declining sales of Paxlovid. That's changing. Exchange-traded funds are an easy diversification solution for at least a portion of your dividend portfolio. 10 stocks we like better than Pfizer › Does the prospect of economic uncertainty have you rethinking your portfolio? Perhaps you'd like to collect a little more cash while the economic headwinds are blowing? It's not an unreasonable concern. Plenty of other investors are already thinking more defensively than they've felt they needed to in a while. To this end, here's a closer look at five high-yielding dividend stocks to consider adding to your portfolio sooner rather than later, until it's clear the worst is behind us. 1. Verizon Communications Dividend yield: 6.2% Verizon Communications (NYSE: VZ) is, of course, one of the country's biggest wireless service providers, boasting well over 100 million paying customers who collectively handed over nearly $135 billion worth of revenue last year alone. Of that, $18 billion was turned into net income, $11.25 billion of which was dished out to shareholders in the form of dividends. That's in line with the company's long-term norms. There is an arguable downside here. That's growth ... or lack thereof. The well-saturated U.S. wireless market doesn't offer much in the way of upside potential above and beyond simple population growth. Verizon is finding some inroads within the institutional/private 5G communications space, but that's a highly competitive market. There's just not a ton of expansion to be added here either. What Verizon may lack in growth potential, however, it more than makes up for in consistency and sheer payout. Nobody's interested in giving up their mobile phones, which supports a sizable forward-looking yield of 6.2% that's based on a dividend that has now been raised for 18 consecutive years. Not bad. 2. Realty Income Dividend yield: 5.6% Realty Income (NYSE: O) isn't a stock in the traditional sense. Rather, it's a real estate investment trust, or REIT. That just means it owns a portfolio of rent-bearing real estate. REITs trade just like ordinary stocks do, and pay dividends the same way that dividend stocks do, too. And Realty Income brings something else to the table that's pretty unique in addition to its sizable forward-looking yield of 5.6%. That's a monthly dividend payment, as opposed to the quarterly cadence you'll get with most other dividend stocks. Realty Income's specialty is retailing real estate. In light of the so-called "retail apocalypse" that seems to never end, this focus seems like a liability. Just take a step back and look at the bigger picture. While numbers from Coresight Research point out that 7,325 U.S. stores were shuttered last year, 5,970 new stores were opened (or reopened). Realty Income further narrows this gap by serving the strongest survivors in the business. Its top tenants include 7-Eleven, Dollar General, Dollar Tree, and FedEx, just to name a few. Underscoring the quality caliber of its renters is the fact that its occupancy rate currently stands at an industry-beating 98.5%, and only fell to 97.9% in COVID-crimped 2020. This resilience is one of the reasons the REIT has been able to raise its payout annually for the past 30 consecutive years. 3. SPDR Portfolio S&P 500 High Dividend ETF Dividend yield: 4.6% Speaking of dividend stocks that aren't actually stocks, add the SPDR Portfolio S&P 500 High Dividend ETF (NYSEMKT: SPYD) to your watch list, if not to your portfolio. An ETF (or exchange-traded fund) is a basket of stocks with a common characteristic. In this instance, these tickers are all part of the S&P 500 High Dividend Index, which tracks the 80 highest-yielding names within the S&P 500. These include Philip Morris, toymaker Hasbro, AT&T, and Ford Motor Company, for reference. None of these names has a great deal of growth firepower. All of them, however, are healthy dividend payers. Most of them also have a solid track record of dividend growth, even if it's not required for inclusion in the underlying index. Sure, you can probably find higher dividend yields than the one SPYD offers. The aforementioned Realty Income and Verizon both boast bigger ones, for instance. The SPDR Portfolio S&P 500 High Dividend ETF is still an incredibly simple way of achieving a well-diversified mix of dividend stocks though, with a little more potential for capital appreciation than Verizon or Realty Income offer. 4. Pfizer Dividend yield: 6.9% It's no secret that drugmaker Pfizer (NYSE: PFE) has underperformed since the wind-down of COVID-19, which upended sales of its Paxlovid approved to treat the disease. The company's top line has slipped from 2022's $100 billion to only $64 billion last year, for perspective, and analysts aren't looking for any sales growth this year or next either. That's the chief reason Pfizer shares continue to flounder. If you can look just a little further down the road though, some new blockbuster drugs are in the works -- drugs like vepdegestrant, for the treatment of ER+/HER2- metastatic breast cancer. While it will be competing with plenty of other therapies in this same space, it's noteworthy that the FDA fast-tracked this drug, which is being co-developed with Arvinas. And that's just one. Pfizer got a total of four promising oncology drugs with its 2023 acquisition of Seagen, and now has over 100 clinical trials underway, 30 of which are in phase 3 (late-stage) testing. Indeed, the company believes it's got eight oncology candidates in its developmental pipeline that could become blockbusters by 2030. Little of this long-term upside is being reflected in the stock's present price, however, even though it arguably should be. More to the point for interested income investors, this pharmaceutical stock's weakness has pushed its forward-looking dividend yield up to nearly 7% at a point where the pharma giant is on the verge of significant prolonged revenue and profit growth. 5. Global X Nasdaq 100 Covered Call ETF Dividend yield: 14% Finally, consider adding a stake in the Global X Nasdaq 100 Covered Call ETF (NASDAQ: QYLD) to your dividend portfolio. It's not a stock. It's an exchange-traded fund. And an unusual one at that. While it holds the same tickers that make up the tech-heavy Nasdaq-100 index, serving as an index fund isn't its primary purpose. Rather, this ETF's purpose is to generate reliable income that's regularly distributed to shareholders by selling covered calls against the ETF's stock holdings. It's an income-generating process called "buy-write," in fact -- you're buying a stock, and then "writing" (or selling) call options on those shares, essentially using them as collateral. And the process works. Although the income generated by writing covered calls over and over again can be erratic (don't count on that trailing 14% yield going forward), the resulting reliable yields are typically big even if they're not precisely predictable. There's also a big downside, though. That is, this fund is almost certainly guaranteed to underperform the Nasdaq-100 itself, even after factoring in all of its sizable dividend payments. That's just the nature of selling covered calls -- the strategy doesn't let you fully participate when the market's rallying the most. Writing options is just a means of monetizing stock holdings when they're mostly moving sideways, or losing ground. Still, with a double-digit yield, even only capturing a portion of the Nasdaq-100's long-term upside isn't a bad bet. It's just arguably not the only dividend-paying investment you'd want to own at any given time, mostly due to its inconsistent payments. Should you buy stock in Pfizer right now? Before you buy stock in Pfizer, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Pfizer wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,056,790!* Now, it's worth noting Stock Advisor's total average return is 1,048% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 15, 2025 James Brumley has positions in AT&T. The Motley Fool has positions in and recommends FedEx, Pfizer, and Realty Income. The Motley Fool recommends Hasbro, Philip Morris International, and Verizon Communications. The Motley Fool has a disclosure policy. 5 High-Yield Stock Picks to Add to Your Dividend Portfolio was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Globe and Mail
4 days ago
- Business
- Globe and Mail
5 High-Yield Stock Picks to Add to Your Dividend Portfolio
Key Points Verizon and Realty Income may not offer much growth, but their ability to fund growing dividend payments is rock-solid. Pfizer struggled following the wind-down of the coronavirus pandemic, with nothing offsetting declining sales of Paxlovid. That's changing. Exchange-traded funds are an easy diversification solution for at least a portion of your dividend portfolio. 10 stocks we like better than Pfizer › Does the prospect of economic uncertainty have you rethinking your portfolio? Perhaps you'd like to collect a little more cash while the economic headwinds are blowing? It's not an unreasonable concern. Plenty of other investors are already thinking more defensively than they've felt they needed to in a while. To this end, here's a closer look at five high-yielding dividend stocks to consider adding to your portfolio sooner rather than later, until it's clear the worst is behind us. 1. Verizon Communications Dividend yield: 6.2% Verizon Communications (NYSE: VZ) is, of course, one of the country's biggest wireless service providers, boasting well over 100 million paying customers who collectively handed over nearly $135 billion worth of revenue last year alone. Of that, $18 billion was turned into net income, $11.25 billion of which was dished out to shareholders in the form of dividends. That's in line with the company's long-term norms. There is an arguable downside here. That's growth ... or lack thereof. The well-saturated U.S. wireless market doesn't offer much in the way of upside potential above and beyond simple population growth. Verizon is finding some inroads within the institutional/private 5G communications space, but that's a highly competitive market. There's just not a ton of expansion to be added here either. What Verizon may lack in growth potential, however, it more than makes up for in consistency and sheer payout. Nobody's interested in giving up their mobile phones, which supports a sizable forward-looking yield of 6.2% that's based on a dividend that has now been raised for 18 consecutive years. Not bad. 2. Realty Income Dividend yield: 5.6% Realty Income (NYSE: O) isn't a stock in the traditional sense. Rather, it's a real estate investment trust, or REIT. That just means it owns a portfolio of rent-bearing real estate. REITs trade just like ordinary stocks do, and pay dividends the same way that dividend stocks do, too. And Realty Income brings something else to the table that's pretty unique in addition to its sizable forward-looking yield of 5.6%. That's a monthly dividend payment, as opposed to the quarterly cadence you'll get with most other dividend stocks. Realty Income's specialty is retailing real estate. In light of the so-called "retail apocalypse" that seems to never end, this focus seems like a liability. Just take a step back and look at the bigger picture. While numbers from Coresight Research point out that 7,325 U.S. stores were shuttered last year, 5,970 new stores were opened (or reopened). Realty Income further narrows this gap by serving the strongest survivors in the business. Its top tenants include 7-Eleven, Dollar General, Dollar Tree, and FedEx, just to name a few. Underscoring the quality caliber of its renters is the fact that its occupancy rate currently stands at an industry-beating 98.5%, and only fell to 97.9% in COVID-crimped 2020. This resilience is one of the reasons the REIT has been able to raise its payout annually for the past 30 consecutive years. 3. SPDR Portfolio S&P 500 High Dividend ETF Dividend yield: 4.6% Speaking of dividend stocks that aren't actually stocks, add the SPDR Portfolio S&P 500 High Dividend ETF (NYSEMKT: SPYD) to your watch list, if not to your portfolio. An ETF (or exchange-traded fund) is a basket of stocks with a common characteristic. In this instance, these tickers are all part of the S&P 500 High Dividend Index, which tracks the 80 highest-yielding names within the S&P 500. These include Philip Morris, toymaker Hasbro, AT&T, and Ford Motor Company, for reference. None of these names has a great deal of growth firepower. All of them, however, are healthy dividend payers. Most of them also have a solid track record of dividend growth, even if it's not required for inclusion in the underlying index. Sure, you can probably find higher dividend yields than the one SPYD offers. The aforementioned Realty Income and Verizon both boast bigger ones, for instance. The SPDR Portfolio S&P 500 High Dividend ETF is still an incredibly simple way of achieving a well-diversified mix of dividend stocks though, with a little more potential for capital appreciation than Verizon or Realty Income offer. 4. Pfizer Dividend yield: 6.9% It's no secret that drugmaker Pfizer (NYSE: PFE) has underperformed since the wind-down of COVID-19, which upended sales of its Paxlovid approved to treat the disease. The company's top line has slipped from 2022's $100 billion to only $64 billion last year, for perspective, and analysts aren't looking for any sales growth this year or next either. That's the chief reason Pfizer shares continue to flounder. If you can look just a little further down the road though, some new blockbuster drugs are in the works -- drugs like vepdegestrant, for the treatment of ER+/HER2- metastatic breast cancer. While it will be competing with plenty of other therapies in this same space, it's noteworthy that the FDA fast-tracked this drug, which is being co-developed with Arvinas. And that's just one. Pfizer got a total of four promising oncology drugs with its 2023 acquisition of Seagen, and now has over 100 clinical trials underway, 30 of which are in phase 3 (late-stage) testing. Indeed, the company believes it's got eight oncology candidates in its developmental pipeline that could become blockbusters by 2030. Little of this long-term upside is being reflected in the stock's present price, however, even though it arguably should be. More to the point for interested income investors, this pharmaceutical stock's weakness has pushed its forward-looking dividend yield up to nearly 7% at a point where the pharma giant is on the verge of significant prolonged revenue and profit growth. 5. Global X Nasdaq 100 Covered Call ETF Dividend yield: 14% Finally, consider adding a stake in the Global X Nasdaq 100 Covered Call ETF (NASDAQ: QYLD) to your dividend portfolio. It's not a stock. It's an exchange-traded fund. And an unusual one at that. While it holds the same tickers that make up the tech-heavy Nasdaq-100 index, serving as an index fund isn't its primary purpose. Rather, this ETF's purpose is to generate reliable income that's regularly distributed to shareholders by selling covered calls against the ETF's stock holdings. It's an income-generating process called "buy-write," in fact -- you're buying a stock, and then "writing" (or selling) call options on those shares, essentially using them as collateral. And the process works. Although the income generated by writing covered calls over and over again can be erratic (don't count on that trailing 14% yield going forward), the resulting reliable yields are typically big even if they're not precisely predictable. There's also a big downside, though. That is, this fund is almost certainly guaranteed to underperform the Nasdaq-100 itself, even after factoring in all of its sizable dividend payments. That's just the nature of selling covered calls -- the strategy doesn't let you fully participate when the market's rallying the most. Writing options is just a means of monetizing stock holdings when they're mostly moving sideways, or losing ground. Still, with a double-digit yield, even only capturing a portion of the Nasdaq-100's long-term upside isn't a bad bet. It's just arguably not the only dividend-paying investment you'd want to own at any given time, mostly due to its inconsistent payments. Should you invest $1,000 in Pfizer right now? Before you buy stock in Pfizer, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Pfizer wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,056,790!* Now, it's worth noting Stock Advisor's total average return is 1,048% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 15, 2025
USA Today
4 days ago
- Business
- USA Today
5 high-yield stock picks to add to your dividend portfolio
It might be prudent to make a point of collecting a little more cash in the near future, and worry a little less about growth. Does the prospect of economic uncertainty have you rethinking your portfolio? Perhaps you'd like to collect a little more cash while the economic headwinds are blowing? It's not an unreasonable concern. Plenty of other investors are already thinking more defensively. To this end, here's a closer look at five high-yielding dividend stocks to consider adding to your portfolio sooner rather than later, until it's clear the worst is behind us. 1. Verizon Communications Dividend yield: 6.2% Verizon Communications is, of course, one of the country's biggest wireless service providers, boasting well over 100 million paying customers who collectively handed over nearly $135 billion worth of revenue last year alone. Of that, $18 billion was turned into net income, $11.25 billion of which was dished out to shareholders in the form of dividends. That's in line with the company's long-term norms. There is an arguable downside here. That's growth ... or lack thereof. The well-saturated U.S. wireless market doesn't offer much in the way of upside potential above and beyond simple population growth. Verizon is finding some inroads within the institutional/private 5G communications space, but that's a highly competitive market. There's just not a ton of expansion to be added here either. What Verizon may lack in growth potential, however, it more than makes up for in consistency and sheer payout. Nobody's interested in giving up their mobile phones, which supports a sizable forward-looking yield of 6.2% that's based on a dividend that has now been raised for 18 consecutive years. Not bad. 2. Realty Income Dividend yield: 5.6% Realty Income isn't a stock in the traditional sense. Rather, it's a real estate investment trust, or REIT. That just means it owns a portfolio of rent-bearing real estate. REITs trade just like ordinary stocks do, and pay dividends the same way that dividend stocks do, too. And Realty Income brings something else to the table that's pretty unique in addition to its sizable forward-looking yield of 5.6%. That's a monthly dividend payment, as opposed to the quarterly cadence you'll get with most other dividend stocks. Realty Income's specialty is retailing real estate. In light of the so-called "retail apocalypse" that seems to never end, this focus seems like a liability. But take a step back and look at the bigger picture. While numbers from Coresight Research point out that 7,325 U.S. stores were shuttered last year, 5,970 new stores were opened (or reopened). Realty Income further narrows this gap by serving the strongest survivors in the business. Its top tenants include 7-Eleven, Dollar General, Dollar Tree, and FedEx, just to name a few. Underscoring the quality caliber of its renters is the fact that its occupancy rate currently stands at an industry-beating 98.5%, and only fell to 97.9% in COVID-crimped 2020. This resilience is one of the reasons the REIT has been able to raise its payout annually for the past 30 consecutive years. 3. SPDR Portfolio S&P 500 High Dividend ETF Dividend yield: 4.6% Speaking of dividend stocks that aren't actually stocks, add the SPDR Portfolio S&P 500 High Dividend ETF (NYSEMKT: SPYD) to your watch list, if not to your portfolio. An ETF (or exchange-traded fund) is a basket of stocks with a common characteristic. In this instance, these tickers are all part of the S&P 500 High Dividend Index, which tracks the 80 highest-yielding names within the S&P 500. These include Philip Morris, toymaker Hasbro, AT&T, and Ford Motor Company, for reference. None of these names has a great deal of growth firepower. All of them, however, are healthy dividend payers. Most of them also have a solid track record of dividend growth, even if it's not required for inclusion in the underlying index. Sure, you can probably find higher dividend yields than the one SPYD offers. The aforementioned Realty Income and Verizon both boast bigger ones, for instance. The SPDR Portfolio S&P 500 High Dividend ETF is still an incredibly simple way of achieving a well-diversified mix of dividend stocks though, with a little more potential for capital appreciation than Verizon or Realty Income offer. 4. Pfizer Dividend yield: 6.9% It's no secret that drugmaker Pfizer (NYSE: PFE) has underperformed since the wind-down of COVID-19, which upended sales of its Paxlovid approved to treat the disease. The company's top line has slipped from 2022's $100 billion to only $64 billion last year, for perspective, and analysts aren't looking for any sales growth this year or next either. That's the chief reason Pfizer shares continue to flounder. If you can look just a little further down the road, though, some new blockbuster drugs are in the works -- drugs like vepdegestrant, for the treatment of ER+/HER2- metastatic breast cancer. While it will be competing with plenty of other therapies in this same space, it's noteworthy that the FDA fast-tracked this drug, which is being co-developed with Arvinas. And that's just one. Pfizer got a total of four promising oncology drugs with its 2023 acquisition of Seagen, and now has over 100 clinical trials underway, 30 of which are in phase 3 (late-stage) testing. Indeed, the company believes it's got eight oncology candidates in its developmental pipeline that could become blockbusters by 2030. Little of this long-term upside is being reflected in the stock's present price, however, even though it arguably should be. More to the point for interested income investors, this pharmaceutical stock's weakness has pushed its forward-looking dividend yield up to nearly 7% at a point where the pharma giant is on the verge of significant prolonged revenue and profit growth. 5. Global X Nasdaq 100 Covered Call ETF Dividend yield: 14% Finally, consider adding a stake in the Global X Nasdaq 100 Covered Call ETF (NASDAQ: QYLD) to your dividend portfolio. It's not a stock. It's an exchange-traded fund. And an unusual one at that. While it holds the same tickers that make up the tech-heavy Nasdaq-100 index, serving as an index fund isn't its primary purpose. Rather, this ETF's purpose is to generate reliable income that's regularly distributed to shareholders by selling covered calls against the ETF's stock holdings. It's an income-generating process called "buy-write," in fact -- you're buying a stock, and then "writing" (or selling) call options on those shares, essentially using them as collateral. And the process works. Although the income generated by writing covered calls over and over again can be erratic (don't count on that trailing 14% yield going forward), the resulting reliable yields are typically big even if they're not precisely predictable. There's also a big downside, though. That is, this fund is almost certainly guaranteed to underperform the Nasdaq-100 itself, even after factoring in all of its sizable dividend payments. That's just the nature of selling covered calls -- the strategy doesn't let you fully participate when the market's rallying the most. Writing options is just a means of monetizing stock holdings when they're mostly moving sideways, or losing ground. Still, with a double-digit yield, even only capturing a portion of the Nasdaq-100's long-term upside isn't a bad bet. It's just arguably not the only dividend-paying investment you'd want to own at any given time, mostly due to its inconsistent payments. James Brumley has positions in AT&T. The Motley Fool has positions in and recommends FedEx, Pfizer, and Realty Income. The Motley Fool recommends Hasbro, Philip Morris International, and Verizon Communications. The Motley Fool has a disclosure policy. The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY. Should you invest $1,000 in Pfizer right now? Offer from the Motley Fool: Before you buy stock in Pfizer, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Pfizer wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,056,790!* Now, it's worth noting Stock Advisor's total average return is 1,048% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 15, 2025
Yahoo
4 days ago
- Business
- Yahoo
3 Reasons to Buy Realty Income Stock Like There's No Tomorrow
Key Points Realty Income offers an unusually generous but sustainable payout. It offers a strong, stable portfolio of revenue-generating properties. Realty Income is arguably more undervalued than most investors may assume. 10 stocks we like better than Realty Income › Realty Income (NYSE: O) may not look like a particularly attractive buy at first glance. The stock currently sells for approximately 30% below its peak in February 2020, meaning it never recovered from the pandemic challenges. Additionally, high interest rates appear to have deterred investors from purchasing the stock. Nonetheless, a closer inspection of the stock may actually signal opportunity instead of continued struggles. Investors may want to consider buying like there is no tomorrow for three key reasons. 1. Realty Income's dividend Realty Income is defined in large part by its dividend. Part of that is due to the fact that it is a real estate investment trust (REIT), which requires it to pay at least 90% of its net income to its shareholders in the form of dividends. It bills itself as "The Monthly Dividend Company," and it has paid a dividend every month since November 1994. That dividend has also increased at least once per year since then. Over the past 12 months, the company has approved five dividend increases. That amounted to a cumulative yearly rise of just 2.3%, increasing what was already a generous payout. The annual dividend of almost $3.23 per share amounts to a dividend yield of nearly 5.6%. To put that into context, the average S&P 500 dividend yield is just over 1.2%. Realty Income can probably afford this dividend. Over the trailing 12 months, the company reported funds from operations (FFO) income of $4.12 per share. With the company paying just over $3.15 per share in dividends during that time, it leaves cash for share repurchases or acquiring additional properties. 2. The company's property portfolio Realty Income's property portfolio also speaks to the company's stability, as it owns approximately 15,600 single-tenant properties. The REIT leases the properties under net lease arrangements, meaning the tenants cover the insurance, maintenance, and property taxes, providing the company with a more stable stream of revenue. Additionally, the company benefits from the fact that many companies prefer to lease their real estate, freeing up capital for other purposes. Such tenants include Walmart, Home Depot, and Tractor Supply, all of which have long-term track records of stability and profitability, ensuring that default rates remain low. The occupancy rate of these properties was 98.5% in the first quarter, meaning nearly all of its holdings generate revenue. This has prompted it to grow through acquisition, and in 2024, it added more than 2,000 properties to its portfolio by acquiring its peer, Spirit Realty. Moreover, in Q1, Realty Income purchased 50 properties and had an additional 71 under development, demonstrating its continued expansion. 3. The opportunity in Realty Income stock Realty Income is currently trading for approximately 30% below its all-time high reached in early 2020. Like most other stocks, it initially fell that year because of the pandemic. It rose after that brief sell-off until rising interest rates interrupted its recovery, and the latest efforts to recover have only come slowly. Indeed, higher interest costs seemed to have lowered its bottom line. Nonetheless, interest rates were not high enough to stop Realty Income from acquiring and developing properties, including the aforementioned Spirit Realty acquisition. Furthermore, Realty Income comes with a surprisingly low valuation. On the surface, the P/E ratio of 53 makes it look pricey. However, FFO income over the trailing 12 months was $4.12 per share, implying it sells at a price-to-FFO ratio of just 14. Between its low valuation and high dividend yield, the stock offers much to income and possibly growth investors as interest rates fall. Realty Income stock is a buy Despite long-term struggles, Realty Income may be a surprisingly lucrative buy. A continually rising dividend has translated into high income returns, even when factoring in the stock's struggles. Moreover, an extensive property portfolio with a low default rate makes the stock and its dividend very stable. Additionally, the stock appears attractively valued when measured by its FFO income. High interest rates have weighed on the company's financial and stock performances. Still, as such worries recede, investors can not only benefit from a generous dividend, but could also bolster returns with stock growth as more investors see Realty Income's value. Should you buy stock in Realty Income right now? Before you buy stock in Realty Income, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Realty Income wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,056,790!* Now, it's worth noting Stock Advisor's total average return is 1,048% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 15, 2025 Will Healy has positions in Realty Income. The Motley Fool has positions in and recommends Home Depot, Realty Income, Tractor Supply, and Walmart. The Motley Fool recommends the following options: short July 2025 $54 calls on Tractor Supply. The Motley Fool has a disclosure policy. 3 Reasons to Buy Realty Income Stock Like There's No Tomorrow was originally published by The Motley Fool Sign in to access your portfolio
