The stock market has been extremely hot over the past year.of S&P500 has soared more than 25%, Nasdaq‘s The value has increased by about 33%. At some point, the market will take a breather.
Market crashes are often ideal times to buy high-quality companies at affordable prices. NextEra Energy (NYSE:Nee) and brookfield infrastructure (NYSE:BIP)(NYSE:BIPC) It will probably fall between Next Market downturn.it is wonderful Now’s your chance to scoop up shares in these ultra-high dividend stocks.
of powerful Dividend growth is expected Continue
NextEra Energy is a leader in clean energy.of utility We have invested heavily to build a first-class company. Renewable energy work. Today, it is one of the world’s leading producers of wind and solar power.
This strategy has brought significant benefits over the years. NextEra has grown its adjusted earnings per share at an average annual rate of 10% over the past 10 years. This allows the company to grow its dividend at a compound annual rate of 11%. The current yield is 2.8%, about twice as much. S&P500‘s Dividend yield (1.4%).
We expect NextEra Energy to continue to see strong dividend growth over the next few years. Earlier this year, the company extended its goal of delivering above-average dividend growth of about 10% per year through 2026. There are two factors that support that view. The dividend payout ratio is low (59% at the end of last year, compared to 65% for peers). The company also expects adjusted earnings per share growth to be near the high end of its expected range (6% to 8% annually) through 2026.
The company is capitalizing on the strong demand for renewable energy. The first quarter was the second-best quarter ever for new renewable energy and storage project launches (and the best quarter ever for solar PV and storage).There is a growing expectation that strong growth will continue due to strong demand for renewable energy. future.
NextEra Energy’s stock price is likely to fall as the market declines. However, this allows investors to secure a higher dividend yield on new stocks, allowing them to earn more income in the future. Coupled with the company’s strong growth prospects, and that can be produced powerful Total return with subsequent rebound.
Solid growth outlook
Brookfield Infrastructure is a global leader in infrastructure. It operates utilities, midstream, transportation, and data assets. These businesses generate very stable cash flows, supporting the company’s substantial dividends. Brookfield Infrastructure currently yields 5.3%, and its dividend is several times higher than the S&P 500. yield.
The company has done a great job of growing profits and dividends. for many years. Since its founding in 2009, Brookfield Infrastructure has increased funding from operations (FFO) per share at a compound annual rate of 15%. This has supported compound annual dividend growth of 10%.
Brookfield Infrastructure expects its FFO per share to increase by more than 10% annually over the next few years. This supports the company’s belief that it can deliver dividend growth of 5% to 9% per year.
The company expects three essential growth factors to drive FFO per share growth of 6% to 9% annually: higher inflation-linked interest rates, increased production as the global economy expands, and expansion projects. I’m predicting it. Brookfield Infrastructure expects its FFO growth to reach double digits due to its aggressive capital recycling strategy. The company has an excellent track record of selling mature businesses and reallocating the proceeds to more profitable opportunities.
The company plans to sell $2 billion in assets this year ($1.2 billion of which has already been secured). This will give you money to invest in new opportunities. The company recently agreed to increase its stake in an integrated rail and logistics provider in Brazil and purchase a portfolio of telecommunications towers in India. Meanwhile, the company said it is reviewing a large pipeline of early-stage merger and acquisition opportunities that could offer attractive returns.
Market downturns are always an opportunity for Brookfield. In the past, the company has reaped the benefits by buying back its own stock and buying stock in companies it wants to acquire, often leading to deals. meanwhile, The sale is Investors have the opportunity to buy shares in this high-quality company at a lower price, generating more dividend income and earning higher total returns. future.
These stocks should be near their buy/sell highs list
NextEra Energy and Brookfield Infrastructure are great dividend stocks. They offer above-average yields and have delivered above-average dividend growth over the past decade. They have enough power to continue increasing their dividends in the future.. Because of that, they The best high-dividend stocks to buy when the market is down. Investors can secure higher yields and earn more dividend income.
Should you invest $1,000 in NextEra Energy now?
Before buying NextEra Energy stock, consider the following:
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Matt DiLallo holds positions at Brookfield Infrastructure, Brookfield Infrastructure Partners, and NextEra Energy. The Motley Fool owns a position in NextEra Energy and recommends NextEra Energy. The Motley Fool recommends Brookfield Infrastructure Partners. The Motley Fool has a disclosure policy.
2 Super Dividend Stocks to Buy When the Stock Market Sells Off was originally published by The Motley Fool.
