There are so many companies out there considered on sale right now. The thing is, what good are they to you if you don’t really get any returns or cash out of them? Even a good dividend stock might not be that great if shares aren’t at least stable.
Which is why today I’m going to recommend a dividend stock that is stable. One that has done just fine in the last year, and should continue to be a steady investment. One that pays you to own it.
In fact, this could be the best purchase you make in 2023, and one that will see you safely into next year.
Source: Getty Images
Nutrien stock
Nutrien (TSX: NTR) is definitely a great consideration among those looking for a dividend stock they can hold for decades. What’s more, after seeing some volatility from outside influence, the company is back to being a solid buy.
First, let’s get into the dividend to convince you. While Nutrien stock is new, it still has a solid dividend yield at 2.81% as of writing. This is because the company increased the dividend yield earlier this year by 12%.
That’s a significant amount considering Nutrien stock has only been on the market since 2017. It’s even more significant considering in that time it has acquired many businesses, and continues to acquire more. So let’s look next at why this company is such a strong player for you to consider as a dividend stock to buy.
Food won’t go anywhere
Recession, pandemic, apocalypse, no matter what comes our way we’re going to need food. Therefore, companies that provide nutrients for crops and agriculture are going to be the last companies to see prices fall significantly, and among the first ones to see a recovery. Farmers may feed cities, but crop nutrients feed those farms.
Which is why when Russia invaded Ukraine and sanctions were placed on the country, Nutrien stock surged upwards. The company saw an increase thanks to sanctions on Russian potash, a nutrient that Nutrien provides. Honestly, though, Nutrien stock was already doing well.
As mentioned, the company continues to acquire business after business in the nutrient industry, merging a fractured industry and growing it from there. Further, it has brought the business into the 21st century through online sales. This proved incredibly beneficial and even necessary during the pandemic. While droughts and floods affected farmers, Nutrien stock was able to help them return to normalcy quickly afterwards through online sales that kept them safe.
Its ecommerce business has since thrived, and of course expanded in that time as well. And as the dividend stock expanded, so too has its payout. Which is why it’s certainly a great stock to hold for growth in the food industry, but also a solid one to hold during this downturn for dividends.
Bottom line
Nutrien stock is down 22% in the last year, correcting after it surged to all-time highs following the invasion of Ukraine. Yet, shares are up a solid 70% in the last five years, and have also risen 5% year to date as well.
Therefore, I would certainly grab onto this dividend yield at 2.81% today while it trades at around 5.2 times earnings. NTR will pay out strong cash for the year, sure. But it will also provide you with income to be used to reinvest in this dividend stock as it continues to climb.
