One of the hallmarks of a well-diversified portfolio is having one or more all-weather dividend stocks that can provide a reliable income stream. Even better is when those dividend stocks are buy-and-hold candidates.
Fortunately, there are plenty of options on the market that can cater to that need. Here’s a look at two great all-weather dividend stocks you can buy and hold forever.
This is the ultimate buy-and-forget stock
One of the best long-term investments on the market that every investor should consider is Fortis (TSX:FTS). For those who are unfamiliar with the stock, Fortis is one of the largest utilities on the continent.
Utilities like Fortis are great defensive picks owing to their unique business model. In short, utilities are bound by long-term regulated contracts that in turn provide a recurring and stable source of revenue. Fortis can then utilize that stable revenue stream to invest in growth and provide investors with a generous dividend.
As of the time of writing, that dividend works out to a yield of 4.23%. To put that income-earning potential into context, let’s consider an initial $1,000 investment. While that approximate $40 in annual income may not be enough to retire on, it does provide a springboard for additional growth through reinvestments.
And that’s not even the best part. Fortress has provided investors with a generous annual uptick to that dividend for an incredible 49 consecutive years. That fact alone makes Fortis one of the all-weather dividend stocks that every investor should own today.
Banking on growth, banking on income
I would be remiss if I didn’t mention at least one of Canada’s big banks as one of the all-weather dividend stocks to add to your portfolio.
And that big bank to consider right now is Bank of Montreal (TSX:BMO). BMO isn’t the largest of the banks, but it is the oldest and boasts nearly two centuries of dividend payments without fail.
Today, that yield works out to a tasty 5.28%, making it one of the better-paying options on the market. Additionally, like its big bank peers, BMO provides investors with generous annual upticks to that dividend.
This means that like Fortis, investors who drop at least $1,000 in BMO should look beyond the $50 income it provides. Instead, investors should look to the long-term potential through dividend reinvestments. And that’s not all.
It’s also worth noting that BMO boasts significant growth potential. Earlier this year, the bank completed the acquisition of California-based Bank of the West.
The deal added hundreds of new branches to BMO’s U.S. network, pushing it to a presence in 32 state markets. Those branches also represent billions in loans and deposits for the 1.8 million new customers BMO added.
For many long-term investors, that’s reason enough to consider BMO as one of the all-weather dividend stocks to buy now and hold forever.
Your all-weather dividend stocks await!
No investment is without some risk, and that includes both Fortis and BMO. Fortunately, both stocks offer investors a sizable defensive moat and a healthy income stream with proven growth.
In my opinion, one or both stocks would do well as part of a larger, well-diversified portfolio.
