Finding that perfect mix of stocks can make a huge difference in a portfolio over a decade. And while there’s no shortage of great stocks to buy and hold, there are some high-yield dividend stocks that investors should consider buying now.
Here’s a look at two of those high-yield dividend stocks to buy now and hold for a decade or longer.
This is a wow stock
The first high-yield dividend stock that investors should be buying right now is Enbridge (TSX: ENB). Enbridge is often regarded as one of the great dividend stocks to own, and there’s a good reason for that view.
Enbridge is an energy infrastructure giant. The company operates multiple segments, including a vast pipeline network, renewable energy portfolio and natural gas utility business.
The pipeline business, which includes both crude and natural gas elements generates the bulk of Enbridge’s revenue. The sheer volume hauled provides Enbridge with one of the largest defensive moats on the market.
A similar defensive appeal can be said of both the renewable energy business and the utility. Both segments generate a reliable revenue stream backed by long-term, regulated contracts.
Collectively, this translates into a well-diversified and defensive revenue stream that can withstand market volatility. More importantly, that reliable revenue stream helps Enbridge to pay a handsome dividend and invest in growth.
As of the time of writing, Enbridge boasts a juicy 6.60% yield, making this high-yield dividend stock one of the best income-earning stocks on the market. In terms of earnings, investors who drop $40,000 into Enbridge will generate an income of over $2,600.
Another interesting point to note is Enbridge’s history of providing annual upticks to that dividend. Specifically, Enbridge has provided generous annual upticks for three decades without fail.
That factor alone makes this high-yield dividend stock a must-have for any portfolio.
Banking on juicy income and growth for decades
You can’t compile a list of high-yield dividend stocks without mentioning at least one of Canada’s big bank stocks. Specifically, I’m looking at Bank of Nova Scotia (TSX: BNS) as the bank stock to buy right now.
Scotiabank isn’t the largest of the big banks, but it is the most international bank. In recent years, Scotiabank has focused its expansion efforts on Latin America, where developing markets can provide higher-growth opportunities.
That’s not to say Scotiabank isn’t investing elsewhere. Apart from its well-established domestic segment at home, Scotiabank is also investing in the U.S. market.
One recent example of this is Scotiabank’s purchase of 14.9% of U.S.-based financial services outfit KeyCorp for US$2.8 billion.
Turning to income, Scotiabank really impresses. The bank boasts a healthy quarterly dividend that has seen Scotiabank, like Enbridge above, provide reliable annual bumps to that dividend.
As of the time of writing, Scotiabank boasts a yield of 5.90%, which is the highest among its big bank peers. It also means that investors who drop $40,000 into the stock will earn over $2,300 in income.
High-yield dividend stocks
The above stocks can provide a decade or more of solid growth and income-earning opportunities. They also boast very juicy dividends with an established cadence of annual increases.
Perhaps most importantly, they offer defensive moats that can be appealing during times of volatility.
In my opinion, one or both of these high-yield dividend stocks should be core holdings as part of a larger, well-diversified portfolio.
