If you're a retiree looking for dependable and reliable dividend income, there are many quality stocks out there which can be suitable options for your portfolio. The stocks which I've listed below pay above-average yields, grow their dividends on a regular basis, and aren't volatile investments. These can be the types of stocks that you can add to your portfolio, and buy and forget about.
Coca-Cola (KO 1.14%), Procter & Gamble (PG 0.47%), and AbbVie (ABBV 1.09%) can give you a good mix of diversification for your portfolio, while also providing you with some excellent dividend income. Here's why these stocks could be ideal options for retirees to consider today.
Coca-Cola
Soft drink maker Coca-Cola has an iconic business which continues to chug along and generate steady and solid results. Its days of generate high growth may be over but the company has many strong brands in its portfolio which are staples in households all over the world.
What makes Coca-Cola an attractive option for retirees is its high yielding-dividend, which pays 3.2% today. That's more than twice the rate of the S&P 500 average yield of 1.3%. And Coca-Cola is one of the best dividend growth stocks in the world. It was nearly a year ago that the company announced it would be increasing its dividend for a 62nd straight year.
The stock has also averaged a beta of around 0.6 over the past five years, signalling the high degree of stability which it offers. Although the stock's five-year gains are just 10%, Coca-Cola has proven to be a safe investment to hold amid turbulent market conditions while also providing investors with a growing dividend along the way.
Procter & Gamble
Another company which has many strong brands is Procter & Gamble. And like Coca-Cola, this is also a Dividend King. Its streak is actually more impressive as in April 2024, the company boosted its payout for a 68th consecutive year. Even among dividend growth stocks, Procter & Gamble is one of the better and more established income-generating investments to own.
Its yield is 2.5% which is above average and it can provide retirees which some solid dividend income. And with a beta value of 0.4, it's an even less volatile stock than Coca Cola.
Over the years, Procter & Gamble has been steadily growing its business as its leading brands remain in demand with customers despite rising prices. In the trailing 12 months, the company has generated $83.9 billion in sales, with profits totaling $14.3 billion, for an impressive net profit margin of 17%.
With an array of top brands in baby care, oral care, home care, and many other segments, Procter & Gamble has a robust business which makes it one of the better dividend stocks that you can just buy and forget about.
AbbVie
The third stock on this list is AbbVie, a top pharmaceutical company with a solid track record for growth. It's technically a Dividend King as well if you count the time it was part of Abbott Laboratories (AbbVie spun off in 2013) and it has been increasing its payouts at a generous rate in recent years. In the past five years, the healthcare company has raised its dividend by 39%, which averages out to a compounded annual growth rate of 6.8%.
At 3.7%, AbbVie provides investors with the highest yield on this list. Its beta of 0.6 is also highest, but it's still well below 1, which means it isn't as volatile as the overall market.
What's attractive about AbbVie is that not only is it a stable and high-yielding investment, but it also makes for a top growth stock to own. The company has generated strong free cash flow in excess of $21 billion in each of its past three fiscal years. That leaves plenty of room to cover its cash dividend payments of around $11 billion and still invest in future growth opportunities.
The company anticipates high-single digit annual growth in the years ahead and with a robust pipeline that features more than 90 compounds, the business looks to be not just a great investment option for recurring income, but also for growth-oriented investors.
