Your portfolio is incomplete without a few fundamentally strong dividend stocks. Apart from boosting your passive income, dividend-paying companies provide stability to your portfolio. Given their solid business model and steady cash flows, these companies are less susceptible to market volatilities. If you are ready to invest, here are four under-$30 dividend stocks that pay dividends at a healthier rate.
My first pick would be AltaGas (TSX:ALA), which operates regulated midstream and low-risk utility assets. It had reported a solid second-quarter performance in July, with its adjusted EBITDA and EPS rising by 12% and 33%, respectively. The rate base growth amid its ongoing capital investments and solid execution across its businesses drove its financials.
Meanwhile, AltaGas is continuing with its investments across its segments, which could increase its rate base at a compound annual growth rate (CAGR) of 8% through 2025. Along with these investments, the favourable rate revisions, new customer additions, and rising energy demand amid the easing of restrictions could boost its financials in the coming quarters. So, I believe AltaGas’s dividends are safe. Currently, it pays a monthly dividend of $0.0833 per share, with its forward yield standing at 3.95%.
Given its steady cash flows and robust growth prospects, TELUS (TSX:T)(NYSE:TU) could be an excellent buy for income-seeking investors. The demand for high-speed internet service is rising amid increased digitization. So, the advent of the 5G service could be an excellent growth drive for Telus.
As of June 30, the company provided 5G service to 36% of the Canadian population. Meanwhile, the management hopes to expand the service to 70% by this year-end. Besides, the company looks to increase its customer base through innovative products, superior connected experiences, and premium bundled offerings. Also, the easing of restrictions could boost its roaming revenue in the coming quarters.
Given the favourable environment, healthy growth prospects, and a robust balance sheet, Telus is well-equipped to continue paying dividends at a healthier yield. Meanwhile, its dividend yield currently stands at an attractive 4.34%.
Algonquin Power & Utilities
Algonquin Power & Utilities (TSX:AQN)(NYSE:AQN) has raised its dividend by over 10% every year for the last 11 years. It sells the power generated from its renewable facilities through long-term contracts, thus shielding its financials from volume and price fluctuations. Also, its low-risk utility businesses generate steady cash flows, allowing the company to boost its dividends consistently. The company pays a quarterly dividend of $0.2134 per share, with its forward yield standing at 4.34%.
Meanwhile, Algonquin Power & Utilities has planned to invest around $9.4 billion from 2021 to 2015 to increase its renewable and utility assets. These investments could boost the company’s financials and cash flows, thus allowing the company to continue with its dividend growth. So, Algonquin Power & Utilities would be an excellent addition to your portfolio.
My final pick would be NorthWest Healthcare Properties REIT (TSX:NWH.UN), which pays monthly dividends at a juicy yield of 6%. It owns and operates around 190 healthcare properties across seven countries. Given its highly defensive and diversified portfolio, the company enjoys stable cash flows. Besides, the company’s long-term agreements with its tenants, government-backed tenants, and inflation-indexed rent also stabilize its financials.
Meanwhile, NorthWest Healthcare recently raised around $200 million through new equity offerings. Its management expects to use the funds to expand its footprint in Europe and Australia. Further, it also has $320 million worth of projects under construction. These investments could boost the company’s cash flows in the coming quarters. So, the company is well-equipped to continue paying dividends at a healthier rate.
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.
The Motley Fool recommends ALTAGAS LTD., NORTHWEST HEALTHCARE PPTYS REIT UNITS, and TELUS CORPORATION. Fool contributor Rajiv Nanjapla has no position in any of the stocks mentioned.