These stocks all have yields exceeding 5%, suggesting their dividends are fairly secure.
High-dividend stocks can be a smart way to make your money work. Not only do they provide extra cash on hand, but that cash can also be reinvested or help manage daily expenses.
Here are three high-yield stocks that could be worthwhile additions to your portfolio: United Parcel Service (UPS), Enbridge (ENB), and General Mills (GIS). If you invested $6,000 in each, you might see around $1,000 in dividend earnings each year. Here’s why these stocks deserve your attention right now.
United Parcel Service
It hasn’t been an easy year for United Parcel Service, commonly known as UPS. The company experienced a drop in value of over 17% recently as investors have grown wary due to tariffs and the current economic situation affecting global trade.
That said, UPS is making some adjustments, including announcing significant job cuts last year, all in an effort to boost profitability amidst challenges. On the positive side, its free cash flow stands at around $1.4 billion over the last three quarters, comfortably covering its quarterly dividend payments.
Though it may seem contrarian, UPS can still be a solid dividend buy. With a yield of 6.1%, which is substantially higher than the S&P 500 average of 1.1%, if you invested $6,000, you could receive about $370 in dividends annually.
Enbridge
Enbridge, a pipeline company based in Canada, has consistently offered high dividends, which attracts many investors. Its yield, while slightly lower than UPS at 5.8%, makes it a notable option for those looking for long-term stability and growth. Last month, the company announced a 3% rise in its quarterly dividend, marking the 31st year of consecutive increases.
The company is considered a strong pick in the oil and gas sector, as it tends to be less affected by swings in commodity prices. With pipelines that transport oil and gas across North America and long-term contracts providing steady revenue, Enbridge seems well-positioned for consistency. Its distributable cash flow has increased, suggesting that the dividends remain secure.
A $6,000 investment in Enbridge could yield about $350 in dividends over a year.
General Mills
General Mills is another solid pick, offering a 5.5% dividend. Known for popular brands like Cheerios and Betty Crocker, its stock has dropped 25% over the past year, possibly due to worries about shifting trends toward healthier food options affecting its business.
Nevertheless, there’s no immediate need for alarm. The company is still generating strong profits, and concerns regarding a major downturn seem somewhat overstated. Recently, its organic net sales dipped just 1%, and with a payout ratio of 52%, the dividend appears quite secure.
Trading at under 10 times earnings, General Mills might be seen as a long-term contrarian opportunity. Despite tariffs impacting the market, it maintains good margins, and its attractive valuation and high yield show promise for steadiness in income generation.
A $6,000 investment in General Mills could net you around $330 in dividends annually. Overall, if you consider all these investments together, you might expect to earn approximately $1,050 a year in total dividends.
