Investing in stocks of strong corporations that provide unusually high yields relative to their dividend-paying history can aid you populate your portfolio with winners. Listed listed below are two dividend stocks which might be paying their highest yield in years. Chances are you’ll wish to present them added consideration. Here’s why.
1. Nike
Immediately, investors have the possibility to buy shares of a few of the iconic brands on this planet while they trade at a discount. Sports apparel conglomerate Nike (NYSE: NKE) generates $50 billion in annual revenue making it, amongst other things, the worldwide leader in footwear. But Nike’s stock price has fallen 54% from its previous peak over weak consumer spending. The lower share price pushed Nike’s forward dividend yield as much as an above-average 1.83% based on a current quarterly per-share payout of $0.37 — the easiest yield since 2009.
It’s a difficult 12 months for Nike. Sales fell by double-digit rates year-over-year in essentially probably the most recent quarter. Nevertheless, Nike continues to remain profitable while management implements a recent technique to show sales around. Its current quarterly dividend is about half its quarterly earnings, which provides the company a cushion to sustain dividends even during a difficult retail environment.
Nike recently hired former company veteran Elliott Hill as its recent CEO. The hire has the company’s teams upbeat in regards to the future, which is a super sign. While a return to growth is anticipated to take some time, Hill’s experience in leading the company’s industrial and marketing operations for Nike and Jordan Brand across 4 geographies must be invaluable in engineering a turnaround.
Nike is inside the technique of shifting its product portfolio away from lifestyle products to a take care of sports, which is the heart of the brand. The company has already seen early progress, with growth across men’s fitness, global football, and running footwear inside the fiscal first quarter of 2025.
With the worldwide athletic wear market expected to proceed to grow to $293 billion by 2029, consistent with Statista, investing in Nike should repay with good returns and numerous years of passive income.
2. Verizon Communications
The leading telecom operators make great dividend investments due to their recurring revenue streams from wireless and broadband subscribers. Verizon Communications (NYSE: VZ) reported healthy increases in postpaid phone net additions recently that sent the highest off 16% this 12 months, nonetheless the shares still offer a high forward dividend yield of 6.16% — Verizon’s highest yield in over a decade.
The concerns Wall Street had about telecom growth amid the macroeconomic challenges this 12 months were muted last quarter. Verizon reported a solid 12% year-over-year increase in consumer postpaid phone net additions, which refers to those customers who pay for his or her wireless plan with a monthly charge. Verizon may thoroughly be well positioned to ride the coattails of Apple since it launches recent artificial intelligence (AI)-optimized iPhones which might be expected to drive strong sales.
The important thing to Verizon’s growth strategy is that it offers attractive add-on services to win customers to its wireless service, including deals on subscriptions to top digital entertainment services. These compelling add-ons will likely be invaluable tools in retaining customers and driving strong financial results to support the dividend.
Verizon has paid a dividend every 12 months for 40 years, including all the companies that were merged over time to create what’s today Verizon Communications. The current per-share quarterly dividend is $0.6775, representing a payout ratio of 60% based on adjusted earnings guidance for 2024. With strong demand expected for AI-enabled smartphones over the following several years, buying Verizon shares at their current high yield should end in excellent returns for investors.
Must you invest $1,000 in Nike immediately?
Before you buy stock in Nike, consider this:
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John Ballard has no position in any of the stocks mentioned. The Motley Idiot has positions in and recommends Apple and Nike. The Motley Idiot recommends Verizon Communications. The Motley Idiot has a disclosure policy.
2 Dividend Stocks to Double Up on Right Now was originally published by The Motley Idiot