The Forever Dividend Portfolio: 3 A-Rated Stocks to Buy and Hold

Stocks to buy

Dividend Stocks are crucial for any portfolio, because investors can gain substantial dividend income from many quality stocks on the market right now. However, if your top priority is the dividend yield and its stability, you should consider certain stocks more than others.

These stocks may not have massive upside, but they have a very high yield and a sticky dividend that will continue compounding for decades to come. In fact, you could even outperform the market over the long-run by reinvesting these dividends, as some have a similar yield to the average annual market performance.

Here are three high-yield dividend stocks I think are worth looking into right now.

VICI Properties (VICI)

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VICI Properties (NYSE:VICI) is a real estate investment trust (REIT) that focuses on casinos. The company had a good Q1, with revenue growing 8.4% year-over-year to $951.5 million, exceeding estimates. However, earnings of 57 cents per share missed estimates by 9 cents. The real estate market isn’t considered to be the most stable place to invest. This is exactly why most real estate companies are trading at a good discount.

Despite missing on earnings, there were several positives to point out. VICI grew by investing in sports and leisure properties like Homefield in Kansas City. The firm also refinanced debt maturing in 2024 at an opportune time in March when interest rates were lower. Management reaffirmed full-year AFFO guidance in the range of $2.22 to $2.28 per share. Overall, the historical growth pattern here has been very good.

VICI appears well-positioned with a robust pipeline of potential acquisitions and opportunities in fast-growing sectors like sports and entertainment complexes. The stock currently offers a yield of 5.2%.

Once rates come down, this dividend will look even more attractive.

Ares Capital (ARCC)

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Ares Capital (NASDAQ:ARCC) is a corporate finance company that manages assets. It has been one of the most stable and consistent stocks in recent years. Of course, finance-related stocks typically don’t do well during downturns, but I have solid confidence that this is one of the key players that will bounce back and continue delivering over the long-run.

While revenue slightly missed estimates, the company’s net asset value reached a record high of $19.53 per share, up an impressive 6% year over year.

The lending environment remains competitive. However, management highlighted the company’s ability to find attractive deals with low leverage and compelling yields of around 11%. With rising interest rates benefitting their earnings, Ares’ originated yield per unit of leverage hit 10%, above recent averages.

Notably, their portfolio companies showed remarkable 10% EBITDA growth over the past year, signaling robust credit quality. However, non-accruals ticked up slightly to 2.4% of the portfolio.

The 9% dividend yield here is one of the highest in the market right now, and is too good to ignore.

Innovative Industrial Properties (IIPR)

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Innovative Industrial Properties (NYSE:IIPR) showed strong progress in Q1, signing new leases worth $69 million and finishing construction on over 732,000 square feet of facilities. This company is not an industrial company, as its name may suggest. Instead, Innovative rents out space to grow cannabis.

This may seem like a risky business due to the shaky financials of many cannabis companies, but the reality has been different. Around 98% of rents are paid on time. 

Plus, available liquidity exceeded $200 million recently. IIPR has only 11% of its assets tied to debt and no variable-rate obligations, which puts it in a good situation given current economic uncertainties.

The potential for adjustments to cannabis regulations could change the game in a big way, opening many doors to further growth across the industry. With projections that regulated cannabis sales in the United States will grow to $58 billion by 2030, IIPR’s targeted real estate investments could end up paying off very well in the long run.

The dividend yield with IIPR stock sits at 6.4%, but could decline if the stock appreciates more.

On the date of publication, Omor Ibne Ehsan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Omor Ibne Ehsan is a writer at InvestorPlace. He is a self-taught investor with a focus on growth and cyclical stocks that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as cryptocurrencies and penny stocks. You can follow him on LinkedIn.

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