Investing in a group of dividend-growth stocks is one of the most powerful methods to build wealth over the long term. With this in mind, let’s take a look at two high-quality stocks with yields over 5% and reputations for dividend growth, so you can determine which would fit best in your portfolio.
Brookfield Property Partners LP
Brookfield Property Partners LP (TSX:BPY.UN)(NYSE:BPY) is a diversified global real estate company. It owns and operates one of the world’s largest portfolios of office, retail, multifamily, industrial, hospitality, triple net lease, and self-storage assets.
Brookfield currently pays a quarterly distribution of US$0.295 per unit, representing US$1.18 per unit on an annualized basis, and this gives its stock a yield of about 5.3% at today’s levels.
On top of being a bonafide high yielder, Brookfield is an up-and-coming dividend-growth star. It has raised its annual distribution in each of the last two years, and its 5.4% hike in February has it on pace for 2017 to mark the third consecutive year with an increase.
Brookfield is one of the real estate industry’s top picks for distribution growth in the years ahead too. It has a long-term distribution-growth target of 5-8% annually, and I think its very strong financial performance, including its 15.3% year-over-year increase in funds from operations (FFO) to US$1.36 per unit in 2016, and its 9.7% year-over-year increase to US$0.34 per unit in the first quarter of 2017, will allow it to achieve this target for the next decade at least.
CI Financial Corp.
CI Financial Corp. (TSX:CIX) is one of the largest wealth management firms and investment fund companies in Canada. Its subsidiaries include CI Investments, Assante Wealth Management, Stonegate Private Counsel, First Asset Capital, and Grant Samuel Funds Management.
CI Financial currently pays a monthly dividend of $0.1175 per share, representing $1.41 per share on an annualized basis, which gives it a yield of about 5.2% at today’s levels.
Like Brookfield, CI Financial has shown a strong dedication to growing its dividend, but it’s a proven dividend-growth star rather than an up-and-comer. It has raised its annual dividend payment for seven consecutive years, and its 2.2% hike earlier this month has it positioned for 2017 to mark the eighth consecutive year with an increase.
I think CI Financial will continue to provide its shareholders with a growing stream of monthly income going forward as well. I think its strong financial performance, including its 7.1% year-over-year increase in free cash flow (FCF) to $153.8 million in the first quarter of 2017, and its very strong growth of assets under management and advisement that will fuel future FCF growth, including its 14.4% year-over-year increase to $163.6 billion as of April 30, will allow its streak of annual dividend increases to easily continue into the 2020s.
Which of these top dividend stocks belongs in your portfolio?
I think Brookfield Property Partners and CI Financial would make great additions to any Foolish portfolio, so take a closer look at each and strongly consider adding one or both to yours today.
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Fool contributor Joseph Solitro has no position in any stocks mentioned.