The Motley Fool

Retirees: Add Passive Income of $12,000/Year With These 3 Cash Machines

Hi there, Fools. I’m back to highlight three top high-yield dividend stocks. As a reminder, I do this because stocks with attractive yields

  • provide a healthy income stream in both good and bad markets; and
  • tend to outperform the market over the long run.

The three stocks below offer an average dividend yield of 4.7%. If you spread them out evenly in a $250K RRSP account, the group will provide you with an annual income stream of $11,833 on top all the appreciation you could earn.

Let’s get to it.

Office space

Leading off our list is office building owner Slate Office REIT (TSX:SOT.UN), which currently boasts a healthy dividend of 6.8%.

Slate’s solid scale (38 office assets totaling 7.5 million square feet) should continue to support fat payouts for shareholders. In the most recent quarter, revenue jumped 29% to $57.2 million while non-GAAP funds from operations (FFO) per share topped estimates by $0.04.

Moreover, same-property net operating income — a key real estate metric — improved 4.9% to $19.3 million.

“The REIT has undergone a transformative quarter highlighted by the strategic joint venture with a global private equity partner which resulted in a 19% IRR for our unitholders and reinforces the net asset value of the REIT,” said CEO Scott Antoniak.

Slate shares are flat in 2019.

Sunny side up

With a scrumptious dividend yield of 4.3%, energy giant Suncor Energy (TSX:SU)(NYSE:SU) is next on our list of high yielders.

Suncor’s hefty payout continues to be underpinned by massive oil sands infrastructure (7.4 billion barrels of proved plus probable reserves), impressive refinery assets (combined capacity of 460,000 barrels per day), and healthy cash flows. In the most recent quarter, Suncor generated $3 billion in funds from operations, a new Q2 record, while earnings jumped to $2.7 billion.

“Strong cash flow generation and our commitment to capital discipline allowed us to return value to our shareholders through $658 million in dividends and $552 million in share repurchases while, at the same time, strengthening our balance sheet,” said President and CEO Mark Little.

Suncor shares are flat so far in 2019.

Fertilize your portfolio

Rounding out our list is fertilizer giant Nutrien (TSX:NTR)(NYSE:NTR), which currently offers a healthy dividend yield of 3.3%.

With over 27 million tonnes of potash, nitrogen, and phosphate sales, Nutrien is the largest crop nutrient company in the world. That scale, combined with strong demographic tailwinds — world population is expected to near 10 billion by 2050 — should keep shareholders’ pockets stuffed with cash.

In the shorter run, management expects a big corn rebound in 2020.

“We do expect a pretty significant rebound in market fundamentals in 2020,” CEO Chuck Magro on a recent conference call. “You can see it in crop pricing futures but you can also see it in some of the business we’re seeing in crop protection in the third quarter.”

Nutrien shares are up 2% in 2019.

The bottom line

There you have it, Fools: three top high-yield stocks worth checking out.

As always, don’t view them as formal recommendations. Instead, look at them as a starting point for more research. A dividend cut (or halt) can be especially painful, so you’ll still need to do plenty of due diligence.

Fool on.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Nutrien is a recommendation of Stock Advisor Canada.

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