My Top 10 Favorite Dividend Stocks!

what's up everybody ken x dividend investor here this is a super fun video for me because i'm going to tell you what my top 10 favorite dividend stocks are of all time ones that i own and recommend that everyone consider buying in their portfolios assuming you can get them at a decent price so if you like dividend videos like this then i ask you to please hit the thumbs up button subscribe if you haven't yet and turn on that bell notification so come on please hit my button that's what she said also consider sharing this video with a cool friend or relative viewers don't share it with uncool people though i'll also tell you what some honorable mention dividend stocks are and i'll share what i estimate the intrinsic values are of my top 10 to give you a sense of if i would be buying more at today's prices for my portfolio so at number 10 i have a tie and those are my utilities duke energy ticker d uk and southern company ticker sl two other awesome piers worth considering are next terra energy ticker nee and con ed took her ed as of august 10th i own about 115 grand worth of duke making it my eighth largest position in my dividend portfolio and i own 72 grand of southern company my 17th largest position both of which combine to give me about 7 200 in dividends every year one of the things i like about utilities were they're low betas the lower the beta the less volatility the stock has relative to the overall market all of which helps lower my dividend portfolio's volatility i like my growth portfolio to have larger betas to give it larger swings up but in my dividend portfolio i prefer lower volatility to keep things as smooth as possible while it's fun to call utilities the bonds of my portfolio the reality is that they obviously aren't as stable as treasury bonds or something though they still tend to lose less than the overall market when things crash another aspect of utilities i like is that their dividend yield tends to be higher than the market average duke is at 3.71 and southern is at 4.07 both of those dividend yield percentages are low for them because their stock price relative to their dividend payout is higher than they historically normally are and since dividend yield equals dividends paid in a year divided by stock price a high stock price means lower yields here's an example of duke's yield history showing it has slowly been trending down for the last nine years utilities distribute a large amount of their earnings as dividends and a long dividend history often implies stability and reliability duke has increased their dividend for 16 consecutive years in southern house for 20 consecutive years what's amazing is that duke has been paying dividends for 95 consecutive years their dividend went sideways for a few years after the dot-com crash southern company will have paid a dividend to its shareholders that is equal to or greater than the previous quarter for every quarter dating back to 1948. duke's payout ratio is around 75 percent this payout ratio i'm showing is from finvis but they have a bug in their payout ratio unfortunately no data source is always correct southern is actually at a 78 payout ratio another thing i like about utilities is that they're natural monopolies which is nice from an investor perspective because of that monopolistic aspect they have to be carefully regulated in order to protect the interests of their customers who don't really have a choice in using other companies to get their energy one unique aspect of utilities is that they don't earn profits from the energy they sell they provide energy at cost to customers to keep prices as cheap as possible the way they make money is from investments in their infrastructure like in their pipes substations transmission lines etc all of which is needed to provide their services a risk to utilities is that the energy landscape is evolving rapidly thus they need to ensure that they are adequately investing in renewables and other energy sources to continue to remain relevant and valuable so a company like tesla with their energy unit can both be a risk to utilities or could be a partner to utilities duke has a goal of at least 50 carbon reduction by 2030 and has a goal of net zero carbon emissions from electric generation by 2050. in 2020 southern company reduced greenhouse gas emissions 52 from its 2007 benchmark levels exceeding its 2030 goal to reduce those emissions by 50 and has a net zero greenhouse gas emissions goal by 2050 a downside to utilities is that their dividend hikes tend to be low and we see that duke and southern's dividend caggers are in the low 3 range another thing to be aware of is that southern company has struggled with cost overruns from the construction of two new nuclear power plants anyways let's talk about stock price now a stock's price tends to oscillate around its business fundamental performance trends so as things like earnings continue to grow then stock price tends to follow whether i'm talking about utilities or pretty much any stock but in the short run it's not uncommon that people's emotions and headlines can move stock prices well above or below intrinsic value thus always try to do your buys when a stock is below its intrinsic value currently my one year intrinsic value estimate for duke is around eighty dollars so to me they are too pricey today that being said analysts have duke's one year target price at 106 dollars i put so's one year intrinsic value estimated at 57 as compared to analysts who see them at sixty eight dollars analysts have both of them as wholes right now to keep this video relatively short i won't go over revenue and earnings and debt trends and such but if you're considering investing then i recommend you dig into all their financials as well as their business strategies etc okay moving on my ninth favorite dividend sock of all time is 3m ticker mmm i know i had two stocks at number 10 on my list so 3m could be my eighth favorite but i'm treating ties as one additionally i'll call out caterpillar ticker cat and lockheed martin ticker lmt as honorable mentions of this range of favorite picks even though i don't own lmt cad is actually spiking on the day i'm making this video due to the massive infrastructure bill that seems like it will pass in congress that should mean massive funding for roads bridges the electric grid rail etc thus companies like caterpillar stand to benefit back to 3m technology and innovation are at the heart of 3m and they've been granted over a hundred thousand patents and they get thousands of new patents grounded each year they have so many amazing products they sell worldwide including their popular post-it notes and these days their 3m masks are flying off the shelves i own 108 grand of 3m making it my 11th largest position in my dividend portfolio and it pays me about 3 200 a year in dividends it currently has a dividend yield of 3 percent and has an amazing 63 consecutive years of dividend increases along with a 7.75 percent three-year dividend cagger it has a healthy payout ratio at 57 percent my one year intrinsic value estimate for 3m is about 205 dollars so i think it's a bit pricey analysts put it at 207 dollars one year out and they have it as a hold right now okay moving on my eighth favorite dividend stock is jpmorgan chase ticker jpm though others i really like include goldman sachs and pretty much all the canadian banks i stood on the sidelines for a long time getting into jpm but finally did and have had great returns in a relatively short time frame jpm has the largest market cap of any bank in the world and is led by the charismatic billionaire jamie dimon chairman and ceo i own 71 grand of jpm making it my 18th largest position in my dividend portfolio and it pays me about 1800 a year in dividends it currently has a dividend yield of two point two six percent and has an okay ten consecutive years of dividend increases along with a great sixteen point four percent three-year dividend cagger it has a nice slow payout ratio at twenty four percent my one year intrinsic value estimate for jpm is at 180 and analysts have it at 172 dollars so i'm more bullish than they are and they have it as a buy okay moving on my seventh favorite dividend stock is pepsico ticker pep they'll all include coke as an honorable mention at this point pepsi has done a great job diversifying their revenue beyond drinks to include awesome snacks like doritos cheetos and ruffles i own 119 grand of pepsi making it my seventh largest position in my dividend portfolio and it pays me about 3 300 a year in dividends the general trend towards healthier living is a risk for pepsi but i think some people will always consume less healthy snack options and pepsi can attempt to mitigate that by adding other healthier products to their portfolio it currently has a dividend yield of 2.78 percent has an amazing 49 consecutive years of dividend increases along with the nice 8.29 three-year dividend cagger it has an okay payout ratio at 69 percent my one-year intrinsic value estimate for pepsi is at 135 dollars and analysts have it at 167 dollars so they are more bullish than i am and they have it as a buy today okay my sixth favorite dividend stock is procter gamble ticker pg though all include clorox which i don't own along with kimberly clark and colgate palmolive that i do own as honorable mentions my family uses pg products every day including tide laundry detergent cascade dishwashing soap bounty paper towels and gillette mach3 razors to name of just a few i own 109 grand of pge making it my 10th largest position in my dividend portfolio and it pays me about 2 680 a year in dividends one of the risks i see for pg is if amazon can continue driving down prices for its generic competitive products procter gamble currently has a dividend yield of 2.45 percent has an amazing 64 consecutive years of dividend increases along with a low 3.9 two percent three-year dividend cagger it has a good 56.9 payout ratio my one-year intrinsic value estimate for pg is 116 thus i think it's overpriced but analysts have it at 159 dollars so they are more bullish than i am but they still have it as a whole today my fifth favorite dividend stock is realty income ticker o a triple net lease real estate investment trust i own 91 grand of realty income making it my 14th largest position in my dividend portfolio and it pays me about 3680 a year in dividends or about 306 dollars a month reits often have higher yields and sometimes they pay monthly like realty income reits are a great way to gain ownership of real estate without having to deal with tenants or maintenance or liquidity issues or etc there's also some unique tax implications which come with reits so dig into that i've really loved how realty income has held up so well in the pandemic in july they collected over 99 of their contractual rent across their total portfolio it currently has a dividend yield of 4.04 percent and has an awesome 26 consecutive years of dividend increases though it only has a low 3.4 percent three year dividend cagger as most dividend investors know payout ratio and pes aren't ideal to utilize for reits so instead you look at funds from operations or ffo but i won't go into that for this video my one year intrinsic value estimate for realty income is about sixty six dollars as i think it's overpriced but analysts have it at seventy seven dollars so they are far more bullish than i am they have it as a buy today okay my fourth favorite dividend stock is mcdonald's ticker mcd and a few others i like include starbucks and home depot both of which i own and lowe's and hormel neither of which i own mcdonald's is one of those stocks that i'm confident will continue on through the generations in poor markets it does well and in good markets it does well it's also considered a real estate play to some degree is they own and lease the land the restaurants operate on it's one of those companies i can never get enough of and i've loved their products since i was a kid i have 96 grand of mcdonald's making it my 12th largest position in my dividend portfolio and it pays me about one hundred fifteen dollars a year in dividends it currently has a dividend yield of two point two one percent and has an amazing forty five consecutive years of dividend increases and has a strong nine point five eight percent three year dividend calgary mcdonald's is a good pair ratio of 55 my one year intrinsic value estimate for mcdonald's is about 205 dollars as i think it's overpriced but analysts have it at 270 dollars so they are more bullish than i am and they have it as a buy today moving on my third favorite dividend stock of all time is johnson johnson ticker j j and another i like is an honorable mention is abv ticker abbvv jnj is a stock that is number one in many dividend investors portfolios and they have many products that my family has used for generations a risk to j j are all the various lawsuits they're engaged in but they've weathered the storm in the past so i'm confident they'll continue to move forward i own 156 grand of jnj making it my third largest position in my dividend portfolio and it pays me about thousand eight hundred and sixteen dollars a year in dividends it currently has a dividend yield of two point four four percent and has an amazing 59 consecutive years of dividend increases along with a decent six point two three percent three-year dividend calgary jnj has a solid 61 payout ratio my one year intrinsic value estimate for jnj is about 160 as i think it's a bit overpriced but analysts have it at 173 dollars so they are more bullish than i am and they have it as a buy today that being said change is a stock that i'm usually happy to dollar cost average into at any time speaking of avv it's a dividend stock which is done very well for its shareholders and is a rare mix that has both growth characteristics along with a high dividend yield the reasons for this are primarily from humira their main cash cow but also has some risks of generics eating into its profits now before i get to my top two i want to share some other honorable mentions which are sin dividend stocks and altria philip morris and british american tobacco they all have great yields and have solid histories of delivering for their shareholders especially altria but i feel the future growth of these types of stocks have even more hurdles than they historically have had and even though i own multiple of them i couldn't include them as my personal favorites though man they pay out a ton since stocks are a staple of most dividend portfolios but i'm not sure they'll be as strong decades from now as they are now even though i'm confident they'll still be here oil stocks are also good candidates for most dividend portfolios but while their yields are great i don't see them flourishing for my great grandkids like my other stocks well okay on to my top spots i actually have two stocks that tied for number one in terms of my most favorite and those are microsoft and apple i've owned microsoft the longest and thus have had the best overall returns with it but even holding apple only two and a half years have given me over 275 returns with it i own 225 grand of microsoft making it my second largest position in my dividend portfolio and it pays me about 1 760 a year in dividends due to its low yield i own 253 grand of apple thus it's my largest dividend position and it's crazy to think that i own over a quarter of a million dollars of apple and it pays me about 1 529 a year in dividends due to its very low yield i consider microsoft and apple as the two crown jewels of my portfolio and they both happen to be above 2 trillion in market cap both companies are just incredible and have delivered amazing total returns for their shareholders if you don't own them then i'd say get in once you find a price you like microsoft has a dividend yield of only 0.78 and apple is even lower at 0.6 percent their stock has been on fire keeping their yield low microsoft has 19 consecutive years of dividend increases as compared to 9 for apple both of which are pretty good for tech companies microsoft has an awesome 27 payout ratio with a strong nine point one percent three-year dividend cagger as compared to apple at an awesome sixteen percent payout ratio and a nine point eight percent three-year dividend calor i've always found it challenging to value tech companies properly so take that for what it's worth thus i'll just say that analysts have microsoft at 325 dollars and they have it as a buy today analysts have apple's one year target at 165 dollars also with a buy but in my opinion both of these estimates are too rich but hey it's tech anything can happen long term they are must-haves in my opinion regardless of what stocks you end up owning i recommend that you follow what's happening to your companies and in the market i'm someone who likes to see how earnings reports go as well as i read all the business news coming out from new products to lawsuits to whatever if you are on my free dividend discord you would see me sharing business articles all day long as news comes out i found it very useful as an investor to be aware of what's happening even though i've also learned that you need to be careful to not overreact to headlines companies that are strong today can die on the vine look at what happened to sears blockbuster borders books pan am airline or heck at one point in time general electric was considered a must-have for most dividend portfolios but the 2008 financial crisis nailed ge they eventually slashed the dividend multiple times so follow your companies to ensure they stay relevant and are constantly evolving where needed finally my list does not mean that these are the only great dividend stocks there are lots of other great dividend companies i like including target stanley black decker walmart illinois tool works and the list goes on and on i'm just sharing my personal favorites in my dividend portfolio and of course there are growth stocks i feel are worth owning as well speaking of portfolios i wanted to share some news that which is that m1 has raised their referral bonus to 50 when new people open an account for their requirements i'm not sure how long this will last but if you don't have an m1 brokerage account then the way it works is you click on my m11 referral link in the description of this video and then either open a brokerage account and find it with a hundred dollars or open a retirement account and find it with 500 deposits which need to happen within 30 days of you opening the account then you need to keep your initial deposit inside the new account for 30 days from the date of deposit to get the free fifty dollars it's honestly free money so consider starting that new growth or dividend portfolio that you've been thinking about now i'd like to shout out my latest patreon aristocrats who have recently signed up so thank you burmart thank you kimberly thank you dj bertrand five thank you guy gasps and thank you jt as patreon aristocrats they gain access to my dividend portfolio tracker spreadsheet which i use in this video and they gain access to multiple private channels on my discord including one where i let people watch my videos before i release them to the public as well as i often let you vote on which thumbnails i use for my new videos if you appreciate this video then please kill that thumbs up button subscribe if you haven't yet and click that bell notification i highly recommend that you join my free dividend discord investing chat server which has thousands of people on it and it's growing all the time it's a great and free way for you to directly interact with other investors and want to be investors thanks for watching and clicking that like button stay positive and i'll talk to you again real soon i am not a financial advisor and these videos are for entertainment inspiration and educational purposes only investing of any kind involves risk i am only sharing my opinion with no guarantee of gains or losses on investments

Channel: GenExDividendInvestor

Views: 16,625

Rating: 4.9570279 out of 5

Keywords: Dividend Portfolio, dividends, dividend investing, dividend growth investing, dividend stocks, genex, genexdividend, genexdividendinvestor, how to invest, best dividend portfolio, what are dividend stocks, investing discord, dividend discord, genx, genxdividend, genxdividendinvestor, stock analysis, stocks, best dividend stocks 2021, best dividend stocks, top dividend stocks to buy, top 10 stocks

Id: x-KIQV_GGEg

Length: 17min 51sec (1071 seconds)

Published: Sat Aug 14 2021