2 Boring but First-Rate Dividend Stocks to Buy and Hold Forever

Leon’s furniture stock and Premium Brands Holding stock are two stable dividend stocks to augment your investment portfolio.

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Some stocks might not have a very fancy yield or the kind of enormous growth that appeals to most investors. But if you only go for bright and lustrous stocks, you might miss the hidden gems that might not sparkle too bright, but may have great potential hidden beneath a dull exterior.

Leon’s Furniture (TSX:LNF) and Premium Brands Holding (TSX:PBH) can be two such stocks.

A homey company

Leon’s furniture is a century company, which started as a general merchandise store in 1909. Now, it’s one of the largest retailers in the country, with over 300 stores.

The company has a stable business, and its core products are furniture, appliances, and home electronics. The company mostly operates within the country.

The company is a consistent dividend payer and has increased its payouts for three consecutive years now. The current yield is a juicy 3.46%, and the payout ratio is very stable at 43%.

Leon’s is very durable, according to the beta of 0.35. Despite the company’s simple business model and significant physical presence, it has embraced technology and operates an incredible online platform for its products.

The boring part about the company would be its market value growth. The market value has grown 59% in the past 10 years. This year, the company’s market value growth has been 7.24%. Currently, it’s trading at $16.29 per share at writing.

A foody company

Premium Brands Holding is a bit less boring. The company is engaged in the tasty business of food and owns a wide variety of food-related brands. It’s involved in both the preparation and distribution of specialty food products. The company operates primarily within the country and in the US.

As a Dividend Aristocrat, the company has increased its payouts for five consecutive years. The current yield is a modest 2.38%.

While the yield might not be as juicy as the food from the company’s various brands, Premium Brands have a somewhat active market value.

Currently, the company is trading at $88.68 per share at writing — an almost 20% growth from the same time last year. The company’s five-year growth is an astonishing 273%.

The current market value has come down significantly, from the all-time high of three digits, but for a year, it’s on the path to rise.

Apart from the recession-resistant business of food, the company also has a low beta 0.51 to show it has a weak correlation to the market movement.

Foolish takeaway

Both companies present low-risk and less-volatile investment options. The yield might not be too juicy compared to some others, but this isn’t all that the companies are offering.

Both Leon’s and Premium Brands are well-run businesses that have carved a nice piece of the market and enjoy a significant market presence. They are also relatively recession-resistant.

So if you are looking for stocks that might not have a lot of glamorous numbers, but offer relative stability and consistent dividends, Leon’s and Premium Brands might be worth a look.

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 Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends LEONS FURNITURE.

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