What is the easiest way to boost your investment returns? Increase how long you keep your stocks. That is especially the case for dividend stocks. Reinvesting your dividends over a long time period can greatly raise your overall returns.
If you plan to hold them for a long time, though, it means that you should be more selective about which stocks you buy. Here are two dividend stocks you can purchase and keep forever.
Abbott Laboratories is a Dividend Titan with 49 years in a row of dividend increases. The firm ranks in Fortune’s Top 50 Most Admired American Companies. It has had the No. 1 spot in its sector for the past eight years.
Those are very impressive accolades. However, it is more important that Abbott has the market-leading spot in its businesses. Heart care, diagnostics, diabetes care, nutrition — and more. Abbott is at the top.
Now, Abbott’s dividend of only 1.4% probably won’t get you excited. But the dividend will very certainly grow given enough time. Even better, Abbott should give stronger earnings and revenue growth that is a precursor to stronger share stock appreciation.
The company’s FreeStyle Libre allows for continuous glucose monitoring and its MitraClip mitral valves serve as crucial growth drivers. Its COVID-19 testing income might decline but will remain an important revenue going forward. Abbott’s drive to innovate will possibly translate to newer products and newer markets over the coming decade and beyond.
Brookfield Renewable can not claim the track record of dividend increases that Abbott can claim. However, the firm has boosted its dividend by a compound growth rate of 6% over the past two decades. And most investors will possibly like its yield of near to 3%.
There is one thing that Brookfield Renewable has in connection with Abbott, though. Its growth is even better than its dividend.
Almost 130 governments have created net-zero carbon targets. Almost 3,100 businesses have committed to reducing their carbon emissions by 50% by the year 2030. This gives a huge opportunity for Brookfield Renewable, which is one of the world’s top energy providers.
Brookfield Renewable expects to bring in total returns of between 12% and 15% over the long haul. With the increasing demand for renewable energy and its huge development poised to give significantly more capacity, the firm should be in a great position to hit that goal.
Author: Scott Dowdy