5 Dividend Stocks for Millennials to Stash Long Term

As passive investing grows riskier with the change of monetary policy, millennials should look to stocks such as Royal Bank of Canada (TSX:RY)(NYSE:RY) and others.

Billionaire investor Carl Icahn, the founder and controlling shareholder of Icahn Enterprises, recently sounded the alarm over the “bubble” in passive investment. Since the 2007-2008 financial crisis and the subsequent era of low interest rates and loose monetary policy, there has been a massive shift from actively managed funds into exchange-traded funds and index funds.

Strengthening global growth has ushered in a evolution of policy from central bankers. The Bank of Canada has joined this push to raise interest rates. Improving economic news in the U.S. sparked a global stock market rout in early February, and figures like Carl Icahn are predicting more volatility moving forward.

Passive investing has been offered up by many firms as an attractive strategy for millennials. However, this new environment could see the elevated risks of this strategy. For millennials who are taking a more active role in buying and selling individual stocks, let’s take a look at a few stocks that offer long-term growth and income.

Brookfield Renewable Partners LP (TSX:BEP.UN)(NYSE:BEP)

Brookfield Renewable boasts a portfolio of renewable power-generating facilities in North America, Latin America, and Europe. Shares of Brookfield Renewable have dropped 7.7% in 2018 as of close on February 9. In its fourth-quarter results, the company hiked its dividend by 5% to $0.49 per share, representing a 6.1% dividend yield. As developed nations make a concerted effort to shift to renewables, companies like Brookfield are attractive long-term holds.

Royal Bank of Canada (TSX:RY)(NYSE:RY)

Royal Bank stock has dropped 3.4% in 2018 thus far. After falling below $100 in trading last week, Royal Bank stands out as an attractive buy-low candidate. In 2017, Royal Bank posted double-digit growth in each of its business segments, including 25% earnings growth in its Wealth Management segment. The stock boasts a quarterly dividend of $0.91 per share, representing a 3.6% dividend yield.

Open Text Corp. (TSX:OTEX)(NASDAQ:OTEX)

Open Text is a Waterloo-based company that sells enterprise information management software. The stock has declined 2.9% in 2018. Open Text released its second-quarter results on January 31. Its revenue rose 35% from the prior year to $734 million, and adjusted EBITDA jumped 45.2% to $290 million. The company delivered a quarterly dividend of $0.16 per share, representing a 1.5% dividend yield.

TransAlta Renewables Inc. (TSX:RNW)

TransAlta is a Calgary-based company that owns and operates hydro facilities and wind farms in Canada and the U.S. The stock has plunged 12% in 2018 so far. In its 2017 third-quarter results, TransAlta boosted its monthly dividend by 7% to $0.08 per share, representing an 8% dividend yield. Revenue grew to $94 million from $45 million from the prior year, and adjusted funds from operations per share increased to $0.29 from $0.25.

Andrew Peller Ltd. (TSX:ADW.A)

Andrew Peller is a Grimsby-based wine company. Shares have dropped 1.6% in 2018 but recently received a boost after the company released its third-quarter results. Sales were up 10.1% with 4.8% organic growth, and adjusted EBTIDA rose 27.5% year to date. The popularity of wine relative to other alcoholic beverages has risen among the millennial generation, making it an attractive long-term bet. Andrew Peller stock also offers a 1.1% dividend yield.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool owns shares of Open Text. Open Text is a recommendation of Stock Advisor Canada. Brookfield Renewable Partners is a recommendation of Dividend Investor Canada.

More on Dividend Stocks

growing plant shoots on stacked coins
Dividend Stocks

Here Are My Top 5 Dividend Aristocrats to Buy Right Now

Now is the time to buy these top five dividend aristocrats at their two-year low before they recover to 2021…

Read more »

edit Real Estate Investment Trust REIT on double exsposure business background.
Dividend Stocks

Is NorthWest REIT Stock the Best High-Yield Dividend for You?

NorthWest REIT (TSX:NWH.UN) offers a substantial dividend, but exercise caution with this riskier stock.

Read more »

STACKED COINS DEPICTING MONEY GROWTH
Dividend Stocks

Income Stocks: A Once-in-a-Decade Chance to Get Rich

These two income stocks are among the best on the TSX for those seeking consistent total returns over a long-term…

Read more »

dividends grow over time
Dividend Stocks

3 Top Royalty Stocks With Dividend Yields of up to 9%

When it comes to secured dividends, these three are top notch. Each offers exposure to royalties through franchising and ultra-high…

Read more »

Golden crown on a red velvet background
Dividend Stocks

This 8 Percent Dividend King Pays Out Every Month

Canoe EIT Income Fund (TSX:EIT.UN) is a staple for monthly income investors.

Read more »

sad concerned deep in thought
Dividend Stocks

Should You Buy Fortis or TC Energy Today?

These stocks have great track records of dividend growth.

Read more »

Dice engraved with the words buy and sell
Dividend Stocks

A&W Stock: Buy, Sell, or Hold?

Shares of A&W (TSX:AW.UN) stock popped by 20% after a major corporate restructuring announcement investors love.

Read more »

Payday ringed on a calendar
Dividend Stocks

3 Monthly Paying Dividend Stocks With Handsome 7% Dividend Yields

Given their healthy cash flows and high yields, I am bullish on these three monthly-paying dividend stocks.

Read more »