Got an Extra $3,000? Buy These Hot “Forever Income” Stocks Before They Fly Away for Good

This group of dividend-growth streakers, including Keyera (TSX:KEY), can help give your portfolio a much-needed raise.

| More on:
Target. Stand out from the crowd

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

Hello there, Fools. I’m back to highlight three attractive dividend-growth stocks. As a quick reminder, I do this because companies with consistently growing dividends

So, even if you have just $3,000 you’d like to put to work, spreading it out among the three stocks below could give you a perpetually growing income machine.

Let’s get to it.

Bank shot

Leading off our list is financial services giant Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM), which has steadily grown its dividend by 34% over the past five years.

The stock has jumped nicely in recent weeks, suggesting that the worst might behind it. Specifically, CIBC’s massive scale (total assets of more than $650 billion), rock-solid financial position, and a diversified revenue stream (personal banking, commercial banking, and wealth management) should continue to support long-term payout growth.

In the most recent quarter, the company’s tier one capital ratio remained solid, despite the pandemic-related dip in earnings and revenue.

“Our capital position remains strong, giving us flexibility and resilience as we navigate the current environment and continue to advance our long-term client-focused strategy,” said CEO Victor Dodig. “This will enable us to further diversify revenue streams, deepen client relationships and improve our efficiency as we continue to deliver value to our shareholders.”

The stock currently offers a healthy dividend yield of 5.8%.

Ringing endorsement

With dividend growth of 27% over the past five years, telecom gorilla BCE (TSX:BCE)(NYSE:BCE) is next on our list.

The stock has held up very well over the past several months, suggesting that BCE remains one of the best ways to play defence. BCE’s massive scale efficiencies, stable cash flows, and highly regulated operating environment should continue to give long-term investors peace of mind.

In the most recent quarter, EPS of $0.06 missed estimates but revenue of $5.35 billion topped expectations. More importantly, free cash flow jumped 50% to $1.61 billion while operating cash flow improved 22%.

“Bell’s performance in Q2 underscored the scale and resiliency of our networks, the strength of our financial foundation, and the Bell team’s success in keeping Canadians fully connected and informed throughout the COVID-19 crisis,” said President and CEO Mirko Bibic.

BCE shares currently boast a dividend yield of 5.8%.

Key to success

Rounding out our list is midstream energy company Keyera (TSX:KEY), which has delivered impressive dividend growth of 40% over the past five years.

Keyera shares have jumped sharply in August, but there might be plenty of room to run. Specifically, the company’s long-term trajectory is backed by well-integrated assets, smart acquisitions, and a strong financial position.

In the most recent quarter, EPS clocked in at $0.08 as revenue declined to $530 million. On the bullish side, Keyera maintained a conservative payout ratio of 51% while continuing to have minimal long-term debt maturities over the next five years.

“We believe our financial strength will allow us to maintain the stability and continuity of the business during this unprecedented economic time, while providing us with flexibility to be opportunistic,” wrote the company.

Keyera shares currently offer a mouth-watering dividend yield of 7.9%.

The bottom line

There you have it, Fools: three attractive dividend-growth stocks worth checking out.

As always, they aren’t formal recommendations. They’re simply a starting point for more research. The snapping of a dividend-growth streak can be particularly painful, so plenty of due diligence is still required.

Fool on.

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 Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool recommends KEYERA CORP.

More on Dividend Stocks

edit Person using calculator next to charts and graphs
Dividend Stocks

The 3 Best Dividend Stocks for Monthly Passive Income

These three dividend stocks are the best options for those seeking high passive income in the next few years in…

Read more »

clock time
Dividend Stocks

Got $10,000 to Invest? 1 Cheap TSX Stock to Buy Right Now

This top TSX dividend stock is finally on sale and has made some savvy buy-and-hold investors quite rich.

Read more »

A close up image of Canadian $20 Dollar bills
Dividend Stocks

Want Monthly Passive Income? These TSX Dividend Stocks Are for You

If you want monthly passive income from TSX stocks, you have to do a little digging. I've given you a…

Read more »

ETF chart stocks
Dividend Stocks

3 International ETFs to Buy for a Diversified Portfolio

Some international markets may prove more resilient against economic downturns, and exposure to them may strengthen your portfolio during crashes…

Read more »

Payday ringed on a calendar
Dividend Stocks

TFSA Pension: 3 Canadian Dividend Stocks to Buy for Monthly Passive Income

These high-yield Canadian stocks look good to buy right now for a TFSA focused on monthly passive income.

Read more »

Dividend Stocks

Need $500 Right Away? These 3 Passive-Income Stocks Have Got You Covered

I could really use an extra $500 to feed my kids, who seem to be permanently hungry. Couldn't you?

Read more »

Young adult woman walking up the stairs with sun sport background
Dividend Stocks

3 Top TSX Stocks to Begin Your Investment Journey

Given their solid business models and stable cash flows, these three TSX stocks are ideal for income-seeking investors.

Read more »

Community homes
Dividend Stocks

Housing Market Crash: How to Make a Profit 

The housing market crash is here, but you can still earn dividends with Brookfield Infrastructure Partners (TSX:BIP.UN)(NYSE:BIP).

Read more »