As many investors have been told time and time again, dividend-paying stocks outperform non-dividend-paying stocks over the long term. It is for this reason that all long-term investors should own at least one dividend-paying stock, and in some cases, maybe even a diversified portfolio full of them. With this in mind, let’s take a look at three stocks that are often overlooked but have high and safe yields of 5-8%.
1. Chemtrade Logistics Income Fund
Chemtrade Logistics Income Fund (TSX: CHE.UN) operates a diversified business providing industrial chemicals and related services to customers around the world. It pays a monthly distribution of $0.10 per share, or $1.20 per share annually, which gives its stock a yield of about 7.6% at today’s levels.
It is important to note that Chemtrade Logistics has maintained its current annual distribution rate since 2007, and I think its ample distributable cash after maintenance capital expenditures, including $1.97 per share in fiscal 2015, could allow it to continue to do so going forward.
2. IGM Financial Inc.
IGM Financial Inc. (TSX: IGM) is one of the largest personal financial services companies in Canada with approximately $133.6 billion in assets under management. It pays a quarterly dividend of $0.5625 per share, or $2.25 per share annually, which gives its stock a yield of about 6.5% at today’s levels.
Investors must also note that IGM Financial has raised its annual dividend payment for two consecutive years. However, I think its decreased amount of cash flow from operating activities net of commissions paid, including a 16.1% year-over-year decline to $621.76 million in fiscal 2015, may cause the company to simply maintain its current dividend rate in 2016.
3. Pembina Pipeline Corp.
Pembina Pipeline Corp. (TSX: PPL)(NYSE: PBA) is one of the leading transportation and midstream service providers to North America’s oil and natural gas industries. It pays a monthly dividend of $0.1525 per share, or $1.83 per share annually, which gives its stock a yield of about 5.6% at today’s levels.
Investors must also note that Pembina Pipeline has raised its annual dividend payment for four consecutive years, and its 5.2% hike in May 2015 has it on pace for 2016 to mark the fifth consecutive year with an increase.
Could your portfolio use more yield?
Chemtrade Logistics, IGM Financial, and Pembina Pipeline are three of the best high-yielding investment options in their respective industries, so Foolish investors should take a closer look and consider establishing positions in at least one of them today.
