Is your portfolio diversified? Finding that perfect mix of income-producing stocks can make all the difference in determining how generous your retirement income will be. Fortunately, there are plenty of great options to consider, including this one stock I’m never selling from my portfolio.
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Meet the stock your portfolio needs
That one stock I’m never selling is Fortis (TSX: FTS). Fortis is a utility stock. In fact, it’s one of the largest utility stocks in North America.
Utility stocks like Fortis provide a good mix of income and growth, making them ideal for investors who want both, wrapped in a defensive shell.
That defensive shell comes from the lucrative yet defensive business model that utilities follow. In short, utilities provide a necessary service. That service is set out in regulated contracts that span decades.
In other words, as long as Fortis continues to provide that utility service, it will generate that recurring revenue stream. And that revenue stream is sufficient to fuel growth and pay out a very handsome dividend.
Fortis’ growth potential is unique. That’s because utilities aren’t typically known for providing growth. In fact, the stereotype view of utility stocks is that they are large, slow-moving behemoths that lack the incentive or ability to invest in growth.
Fortunately, that doesn’t apply when it comes to Fortis.
Fortis has taken an aggressive view when it comes to growth. The company has established a reputation of seeking out acquisitions that have allowed it to expand to new markets both in the U.S. and the Caribbean.
The end result is that Fortis provides a necessary service that allows it to generate a stable and recurring revenue stream from one of the most defensive business models on the market.
But that’s not the main reason Fortis is the stock I’m never selling.
What about that dividend?
One of the main reasons why investors flock to Fortis (and why it’s the stock I’m never selling is for the dividend it offers).
Fortis offers investors a quarterly dividend that pays out a respectable 3.6% yield. This means that investors who can drop $20,000 into this defensive titan will earn a first-year income of just over $710.
And that’s not even the best part.
Prospective investors who are considering Fortis will want to know this other benefit, which plays into why Fortis is the stock I’m never selling.
Fortis has provided annual upticks to that dividend for an incredible 52 consecutive years. This makes Fortis one of just two Dividend Kings in Canada and an incredibly stable choice for long-term investors.
Investors not ready to draw on that income yet should note that reinvesting those dividends can supercharge any long-term growth of that income.
Fortis: The stock I’m never selling (and you shouldn’t either)
Fortis is one of the best long-term investments on the market. Not only does it offer a stable and recurring revenue stream backed by long-term regulated contracts, but it also pays out one of the most stable dividends on the market.
Throw in the defensive appeal of a utility, and you have hands-down one of the best long-term options for any well-diversified portfolio.
