A lot of people still hope that there is an opportunity to make a killing practically overnight. It could happen with another market crash quite likely to be in our future. But there is another tactic that investors might want to consider. That’s a combination of dividend stocks, and high returns.
To find the ideal dividend stocks that would fall into this high-return category, you need to create a portfolio mission. That mission, should you choose to accept it (sorry I had to), is to position yourself for the end of the pandemic. Rather than look at what could bounce back in the next few months, look at what will soar when this is all over.
The COVID-19 vaccine is being distributed by multiple companies around the world. In Canada, all Canadians should have access to it by September 2021 if they haven’t received it already. So what dividend stocks are out there that could soar when we’ve all been injected?
The oil and gas industry suffered long before the pandemic. Years of oil and gas gluts and trade wars left companies reeling. Then the pandemic hit and suddenly these companies couldn’t even produce. It also mean pipeline companies like Enbridge Inc. (TSX:ENB)(NYSE:ENB) couldn’t move forward as well.
That’s starting to change, especially with the vaccine coming. Enbridge is already trying to move forward with its pipeline projects. What’s even better is the dividend stock is supported by decades of long-term contracts, and even recently increased the dividend by 3%. The company’s shares are up 38% since the crash, and offers a 7.6% dividend yield as of writing. Once the pandemic is over, it could soar even higher as the savior of the energy sector.
The real estate market is also had a set back because of COVID-19. Whether it’s housing or office buildings, everyone is stuck indoors. That means no one is using department stores, malls, or offices like they used to. It also means that revenue is quite down for companies like RioCan Real Estate Investment Trust (TSX:REI.UN).
Yet again, news of a vaccine set the stock soaring once more. The company already hit hard times before when Zellers was sold to Target. Since then it’s restructured to create apartment buildings above existing real estate properties, diversifying its portfolio. Even now, the stock is up 50% since the crash, and will likely soar higher when the pandemic is over. Meanwhile, you can still latch on to a 8.42% dividend yield.
Telecommunications have been hit as well during the pandemic, and unless the company was able to get ahead of wireline and 5G, sales haven’t been all that great. In fact, Rogers Communications Inc. (TSX:RCI.B)(NYSE:RCI) had a loss in revenue of between 10% and 15% over the last three quarters. But that could all change after the pandemic.
The company will be able to offer 5G across Canada soon after the pandemic with production up again. It will also see an increase in its broadcasting business, specifically when sports are on a predictable schedule once more. So once the pandemic is over, its recent 32% increase since the March 2020 crash could be well behind it. Meanwhile, you again get a solid dividend of 3.31% as of writing.
All of these stocks offer a +30% upside if the last year is to be believed, especially if we experience another crash that offers a buying opportunity. So as usual, the Fool always recommends buying and holding over the long term. These dividend stocks offer strong quality for your portfolio, and a way to see your portfolio soar when the pandemic is finally behind us.
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Fool contributor Amy Legate-Wolfe owns shares of ENBRIDGE INC. The Motley Fool owns shares of and recommends Enbridge. The Motley Fool recommends ROGERS COMMUNICATIONS INC. CL B NV.