According to the Internal Revenue Service (IRS), passive income generally includes earnings from rental activity or any trade, business, or investment in which the individual does not materially participate. It can also include income from limited partnerships, stocks, bonds, and other similar enterprises in which the investor is not actively involved. The more passive income can help cover rising costs, such as mortgages, insurance, taxes, and other expenses, the easier it is for investors to set aside money for future needs as they prepare for retirement. Dependable, recurring dividends are a recipe for success.
24/7 Wall St. Key Points:
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After a massive rally off the April lows, the stock market may be ready for a breather
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Quality safe Dividend Kings are the perfect long-term investment for growth and income investors
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With the Federal Reserve likely to cut rates at least twice this year, high-yield dividend stocks will benefit
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Companies that have raised their dividends for shareholders for 50 years or longer are the kind of investments that passive income investors need to own. Dependability is crucial for individuals seeking to increase their annual income through dividend stock investments. The Dividend Kings are the 55 companies that have raised their dividends for 50 years, a testament to their dependability and reliability. Those are two “must-have” items for investors who rely on passive income to boost their overall revenue. Unlike the Dividend Aristocrats, the Dividend Kings do not have to be members of the S&P 500.
We screened the Dividend Kings list for stocks that investors may need to become more familiar with and identified four top companies that pay substantial dividends, offering investors a solid source of passive income. All are rated Buy at the top Wall Street firms we cover, and all four are among our top safe Dividend Kings to buy in July.
Why we recommend the Dividend Kings
Companies that have paid and raised their dividends for 50 years or more are the kind that growth and income investors want to buy and hold in their stock portfolios for the long term. These stocks are mostly conservative, and should we see a dramatic market correction, they will likely hold their ground much better than volatile technology names.
National Fuel Gas
National Fuel Gas Company distributes and transports natural gas to hundreds of thousands of customers in Western New York and Northwestern Pennsylvania. This company is poised to break out to new 52-week highs and has delivered a stunning 39.9% total return for investors this year. National Fuel Gas Company (NYSE: NFG) is a diversified energy company.
It operates through four segments:
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Exploration and Production
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Pipeline and Storage
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Gathering
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Utility
The exploration and production segment explores, develops, and produces natural gas and oil.
The pipeline and storage segment provides interstate natural gas transportation services through an integrated gas pipeline system in Pennsylvania and New York, and it owns and operates underground natural gas storage fields.
This segment also transports natural gas for the National Fuel Gas Distribution Corporation and other utilities, industrial companies, and power producers in New York State.
The Gathering segment builds, owns, and operates natural gas processing and pipeline gathering facilities in the Appalachian region, providing gathering services to Seneca.
The Utility segment sells natural gas or provides natural gas utility services to various customers in:
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Buffalo
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Niagara Falls
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Jamestown
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Erie and Sharon in Pennsylvania
Argus has a Buy rating with a $93 target price.
PepsiCo
This top consumer staples stock reported solid fourth-quarter earnings and will continue to supply all the goods for summer tailgates and parties. PepsiCo, Inc. (NYSE: PEP) is a worldwide food and beverage company.
Its Frito-Lay North America segment offers:
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Lays and Ruffles potato chips
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Doritos, Tostitos, and Santitas tortilla chips
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Cheetos cheese-flavored snacks, branded dips
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Fritos corn chips
The company’s Quaker Foods North America segment provides:
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Quaker Oatmeal
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Grits
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Rice cakes
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Natural granola and oat squares
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Pearl Milling mixes and syrups
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Quaker Chewy granola bars
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Cap’n Crunch cereal
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Life cereal
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Rice-A-Roni side dishes
Pepsico’s North America Beverages segment offers beverage concentrates, fountain syrups, and finished goods under these brands:
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Pepsi
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Gatorade
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Mountain Dew
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Diet Pepsi
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Aquafina
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Diet Mountain Dew
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Tropicana Pure Premium
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Sierra Mist
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Mug brands
UBS has a Buy rating on the company with a $169 target price objective.
Stanley Black & Decker
Stanley Black & Decker is the world’s largest tool company, with 50 manufacturing facilities in the United States and more than 100 worldwide. With the potential for the economy to slow down some, you can bet that the do-it-yourself legions will fix rather than buy new, and this legendary stock is a solid idea now. Stanley Black & Decker, Inc. (NYSE: SWK) provides hand tools, power tools, outdoor products, and related accessories in the United States, Canada, Other Americas, Europe, and Asia.
Its Tools & Outdoor segment offers professional-grade corded and cordless electric power tools and equipment, including:
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Drills
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Impact wrenches and drivers
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Grinders, saws, routers, and sanders
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Pneumatic tools and fasteners, such as nail guns, nails, staplers and staples, and concrete and masonry anchors; corded and cordless electric power tools
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Hand-held vacuums, paint tools, and cleaning appliances
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Leveling and layout tools, planes, hammers, demolition tools, clamps, vises, knives, saws, chisels, and industrial and automotive tools
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Drill, screwdriver, router bits, abrasives, saw blades, and threading products
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Toolboxes, sawhorses, medical cabinets, and engineered storage solutions
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Electric and gas-powered lawn and garden products
This segment sells its products under these brand names:
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DEWALT
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CRAFTSMAN
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CUB ADET
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BLACK+DECKER
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HUSTLER
The company’s Industrial segment provides:
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Threaded fasteners, blind rivets and tools, blind inserts and tools
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Drawn arc weld studs and systems
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Engineered plastic and mechanical fasteners
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Self-piercing riveting systems
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Precision nut running systems
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Micro fasteners
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High-strength structural fasteners
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Axel swage, latches, heat shields, pins, couplings, fittings, and other engineered products
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Attachments used on excavators and handheld tools
This segment sells its products through a direct sales force and third-party distributors to the automotive, manufacturing, electronics, construction, aerospace, and other industries.
UBS has a Buy rating with a $100 target price.
United Bancshares
United Bankshares, Inc. is a bank holding company with dual headquarters in Charleston, West Virginia, and Fairfax, Virginia. This mid-cap financial company also offers solid total return potential now, in a sector that has performed well over the last year. United Bancshares, Inc. (NASDAQ: UBSI), through its subsidiaries, primarily provides commercial and retail banking products and services in the United States.
It operates through two segments:
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Community Banking
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Mortgage Banking
The company accepts:
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Checking, savings, and time and money market accounts
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Individual retirement accounts and demand deposits
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Statement and special savings
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NOW accounts.
Its loan products include:
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Commercial loans and leases to small to mid-size industrial and commercial companies
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Construction and real estate loans, such as commercial and residential mortgages
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Loans secured by owner-occupied real estate
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Personal, student, and credit card receivables
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Personal, commercial, and floor plan loans
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Home equity loans.
In addition, the company offers credit cards, safe deposit boxes, wire transfers, and other banking products and services, as well as investment and security services. It also provides services to correspondent banks, including buying and selling federal funds, automated teller machine services, and internet and telephone banking services.
Furthermore, it provides community banking services, including asset management, real property title insurance, financial planning, mortgage banking, brokerage services, investment management, and retirement planning.
Raymond James has an Outperform rating with a $42 target.
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