There are companies out there with quite a bit of potential for future growth.
No one can predict the future, right? But some companies have a clearer sense of their potential for growth compared to others. This makes them appealing options for long-term investments.
Clearway Energy, Kinder Morgan, and ConocoPhillips seem poised for noticeable growth in the next few years. They likely have enough momentum to keep increasing their dividends, making them attractive dividend stocks to have over the next five years.
Strong growth plan
Clearway Energy is backed by a solid mix of clean power assets, like wind and solar energy, as well as natural gas. They sell the electricity they produce through long-term contracts with public projects and large companies, providing significant cash flow stability.
Typically, clean energy firms aim to distribute around 70% of their stable cash flow as dividends, while retaining the rest to expand their portfolios. Clearway has locked in investments meant to enhance cash flow projections, aiming to boost cash flow per share from $2.11 this year to about $2.70 by 2027. Interestingly, they expect that figure might even hit around $3 by 2030, implying a compound annual growth rate of 7% to 8% over the next five years.
Today’s changes
(-0.25%) $-0.09
current price
$35.65
Key data points
Market capitalization
$4 billion
daily range
$35.33 – $35.99
52 week range
$24.40 – $36.89
volume
626K
average volume
1.1M
gross profit
18.97%
dividend yield
4.88%
With its growing cash flow, Clearway plans to boost its dividend yield at about 5%. They currently intend to increase their annual dividend from $1.51 per share to $1.98 per share by 2027.
Plenty of fuel to increase dividends
Kinder Morgan is one of the largest natural gas pipeline companies in the U.S. Its assets are known for generating reliable cash flows, supported by fee contracts, government-regulated rates, and hedging agreements.
Today’s changes
(0.97%) $0.26
current price
$26.98
Key data points
Market capitalization
$60 billion
daily range
$26.54 – $…
52 week range
$23.94 – $31.48
volume
15M
average volume
14M
gross profit
34.77%
dividend yield
4.32%
Kinder Morgan distributes about half of its steady cash flow as dividends, reserving the rest for expansion. They have a $9.3 billion backlog in projects—more than three times what it was at the end of 2023. The demand for gas infrastructure, particularly for liquefied natural gas (LNG) export terminals, is driving this expansion. They’re also looking at over $10 billion in additional expansion opportunities.
The cash flow should rise as these projects finish, which can provide a boost to their 4.3% dividend yield. They’ve managed to raise their dividend for eight straight years, and that trend looks set to continue.
The advent of free cash flow
ConocoPhillips boasts a robust and diverse portfolio in the oil and gas sector, which allows them to generate substantial cash flow, even when oil prices decline.
Today’s changes
(-0.11%) $-0.10
current price
$87.37
Key data points
Market capitalization
$108 billion
daily range
$86.54 – $88.49
52 week range
$79.88 – $111.96
volume
7M
average volume
6.6M
gross profit
26.79%
dividend yield
3.64%
Currently, ConocoPhillips is on the verge of substantial free cash flow growth. They’re predicting an annual increase of $1 billion from 2026 to 2028, with a significant gain anticipated by 2029. They expect to save roughly $1 billion from previous acquisitions too. The company is also actively investing in three LNG projects and anticipates its Alaska project to bring in an extra $4 billion in free cash flow when completed.
This could lead to a total increase of $7 billion over the next few years, which would certainly enhance their existing free cash flow, recorded at $6.1 billion in the first nine months of this year.
As their free cash flow rises, ConocoPhillips is well-placed to support a dividend yield of 3.6%. Recently, they raised their dividend by 8% and are aiming to be among the top 25% of companies globally for dividend growth in the future.
Ideal long-term holding
Clearway Energy, Kinder Morgan, and ConocoPhillips all have promising growth trajectories expected in the next few years. This should give them enough strength to keep raising their attractive dividends, reassuring investors that holding these stocks over the coming five years seems like a wise choice.
