The Motley Fool

3 Dividend Stocks for Growth Investors

Dividend stocks are loved by value investors, but there’s no reason that growth investors have to skip over the opportunity to earn a dividend. There are many stocks that offer both good growth prospects and pay a good dividend as well. While you may sometimes think to get one you have to sacrifice the other, that isn’t necessarily the case.

Below are three attractive growth stocks that can also provide investors with recurring dividend income.

TransAlta Renewables Inc (TSX:RNW) offers investors a very attracting yield of 7% per year, and with monthly installments, it could be a great source of cash flow to help pay the bills. As the name suggests, in addition to earning a great dividend, investors have the opportunity to cash in on a renewable energy stock that could see a lot of growth in its future.

With 34 renewable power facilities in its portfolio, most of which are wind power, TransAlta is in a good position to take advantage of the growing demand for cities to be greener and more environmentally friendly.

The challenge in attracting investors today is that the company hasn’t seen much growth, with sales flat in its most recent quarter. That’s where offering a dividend helps make the stock more attractive to investors that need a little extra something to consider investing in the company.

Emera Inc (TSX:EMA) is a utility stock that has achieved significant growth over the years. Since 2015, sales have more than doubled while growing its bottom line as well. Over the past five years, the share price has climbed by more than 50%, and with lots of opportunities to expand in North America and the Caribbean, there’s still a lot of potential for Emera’s stock to rise further.

Its market cap of $12 billion is still very modest, as the stock trades below two times its book value and at around just 16 times its earnings. On top of offering good value, the stock also pays a great yield of 4.5% to its shareholders. There’s not a great deal of risk investing in Emera, and with dividends, growth and lots of value, it’s a very versatile stock that could look good in any portfolio.

Restaurant Brands International Inc (TSX:QSR)(NYSE:QSR) offers investors the lowest yield on this list at around 3%, but it’s also the most developed and mature company. Restaurant Brands is also planning a lot of growth over the next decade. In a recent update for investors, the company said that it plans to have as many as 40,000 restaurants worldwide within the next 10 years.

Currently, Restaurant Brands has 26,000 locations spread across its three brands: Burger King, Tim Hortons and Popeyes. That would be an increase of more than 50% from where it is today and would likely mean significant expansion outside of North America. In the past, we’ve learned of the company expanding Tim Hortons into new markets, which could be key to its strategy over the next decade.

It’s an aggressive strategy that could unlock a lot of potential for the company in the long term and could produce strong returns for investors that buy the stock today.

Our #1 Stock to Buy in 2019 (and Beyond!)

When you buy heavily cyclical stocks at low prices… and then hold the shares until the cycle reaches its peak… you can make a very healthy profit.

Every investor knows that. But many struggle to identify the best opportunities.

Except The Motley Fool may have a plan to solve that problem! Our in-house analyst team has poured thousands of hours into their proprietary research – and this is the result.

Our top advisor Iain Butler has just identified his #1 stock to buy in 2019 (and beyond).

Click here to claim Iain’s new report, absolutely FREE!

Fool contributor David Jagielski has no position in any of the stocks mentioned. The Motley Fool owns shares of RESTAURANT BRANDS INTERNATIONAL INC and has the following options: short October 2019 $82 calls on Restaurant Brands International.

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.