These stocks all yield more than three times the S&P 500 average.
Together, they can help diversify your portfolio while adding plenty of income and stability over the long haul.
Want some modestly priced stocks that also pay high dividends? It can be challenging finding a quality stock that fits that criteria, but there are three that can be excellent options worth considering today: Realty Income (NYSE: O), AT&T (NYSE: T), and Toronto-Dominion Bank (NYSE: TD).
These stocks are all trading at less than $100 per share, offer high yields that are more than three times the S&P 500 (SNPINDEX: ^GSPC) average of 1.2%, and can be relatively safe investments to simply buy and hold for the long haul. Here's a look at how much these stocks pay, and why they are good investments to put into your portfolio right now.
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On Monday, real estate investment trust (REIT) Realty Income closed at a price of $57.53. This year, the stock has risen by nearly 8%, giving investors some decent gains to go along with a fairly high yield of 5.6%. Not only is Realty Income's high dividend appealing, but the REIT makes payments on a monthly basis. Unlike most other dividend stocks, you can collect a much more frequent payout with this investment.
The REIT also prides itself on stability and consistency; it has declared a dividend for 660 straight months. In June, it also announced that it would be increasing the rate of its monthly dividend for the 131st time in its history.
This year looks to be another solid year for the business, as Realty Income expects occupancy levels of more than 98% and same-store rent growth of around 1%. Its funds from operations for the first three months of the year came in at $1.05, up from $0.94 in the same period last year. The company is diversified across 91 industries and is in multiple markets, making it a fairly safe investment to put in your portfolio.
For buy-and-hold investors, this can be a no-brainer income stock to hang on to.
Telecom giant AT&T trades at around $30 per share and is a modestly priced stock you can pick up right now. Despite soaring more than 50% over the past 12 months, the dividend stock only trades at 17 times its trailing earnings, which is modest in comparison to the average stock on the S&P 500, which trades at a multiple of 24.
AT&T's dividend yields 3.8%, and while the company hasn't raised its payout for multiple years, it may only be a matter of time before that happens. Its financials have been looking good, with the company expecting free cash flow of at least $16 billion this year -- far more than the $8.3 billion it pays out in dividends on an annual basis.
AT&T also makes for an underrated growth stock, as the company is in the process of acquiring Lumen's Mass Markets fiber business, which will nearly double the amount of fiber locations it is in by the end of 2030, to around 60 million.
If you want a combination of a high yield and some good growth potential, AT&T is a stock worth considering today.
Toronto-Dominion Bank is a top Canadian-based bank that can make for a reliable long-term investment. It yields 4.1%, which is a fairly strong payout for a top bank stock. Over a period of five years, TD has increased its quarterly dividend by 42%, for an average compounded annual growth rate of 7.2%.
The bank has operations in the U.S., but due to lax anti-money laundering procedures, it was hit with a $3 billion fine last year and has an asset cap in place in the U.S. as a result of its settlement with regulators.
But as a long-term play, this can still make for an excellent investment. TD is among the largest banks in North America, and over the trailing 12 months, it has posted a profit of 16.8 billion Canadian dollars on revenue totaling CA$58.8 billion, for a terrific profit margin of around 29%.
Trading at around $74 and just 1.5 times its book value, TD can be a good value pickup for income investors today.
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David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Realty Income. The Motley Fool has a disclosure policy.