Tuesday, 2 January 2024

3 High-Yield Dividend Stocks to Buy Hand Over Fist in 2024

by Earn Media

Do you know the only thing that gives me pleasure? It’s to see my dividends coming in.
— John D. Rockefeller

Dividends are an excellent way to build wealth. If you’re out shopping for high-yield dividend stocks for 2024, three excellent options are Kohl’s (NYSE: KSS), Stellantis (NYSE: STLA), and Verizon Communications (NYSE: VZ).

Omnichannel retailer

Kohl’s is a household name and a leading omnichannel retailer, with more than 1,100 stores in 49 states, plus a website and an app. Right now, Kohl’s is a bit of a turnaround story, and management is in the early stages of improving sales and earnings. The company is also focusing on strengthening the balance sheet to be able to maintain and grow its current dividend.

The company’s $0.50-per-share quarterly dividend equates to a juicy 7% yield at the current stock price. Here’s the kicker: If the company’s sales and earnings turnaround gains traction in 2024, the company has room to grow into the dividend levels it reached before the COVID-19 pandemic.

3 High-Yield Dividend Stocks to Buy Hand Over Fist in 2024

KSS Dividend data by YCharts

One positive going for Kohl’s is that its partnership with Sephora is gaining traction. In 2020, the two announced a partnership to roll out a Sephora presence at Kohl’s stores over three years. Management continues to see incremental sales and traffic and will now roll out the beauty-focused name to the remainder of the chain by 2025.

Surprising EV play

Like Kohl’s, Stellantis offers income investors a juicy dividend yield, currently at 6.4%. Stellantis might not be a household name yet, considering it’s pretty fresh from it’s Fiat Chrysler and PSA Group merger, but it still has a lot of recognizable and valuable brands, among them Alfa Romeo, Chrysler, Dodge, Fiat, Jeep, and Ram.

And while brands such as Jeep and Ram drive a big chunk of the company’s profits, its European roots might have helped the company achieve profitability with its electric vehicles (EVs) before companies such as Ford Motor Company and General Motors managed to do so.

In early December, Stellantis CEO Carlos Tavares told analysts the company is “in the black” with EVs in Europe and in the U.S. market. While the company is battling fiercely with Tesla for EV sales in Europe, it recently overcame Tesla to be Europe’s No. 2 EV seller. That’s a big victory for the company that’s partly known for selling massive Jeep and Ram truck vehicles.

Gaining momentum

Verizon hit a speed bump early in 2023, when it lost 127,000 postpaid phone subscribers. However, it managed to nearly erase those losses during the second and third quarters and even gained more than 400,000 quarterly net adds in its smaller broadband business over the past four consecutive quarters.

More importantly, at least for income investors looking for safe dividends, is that the company raised its full-year free cash flow outlook during the third quarter and increased its dividend for the 17th consecutive year — the longest current streak in the U.S. telecom industry.

Image showing Verizon's growing dividend.

Image source: Verizon.

As the company’s core business stabilizes and continues to gain customers, the stock trades at a paltry price-to-earnings ratio of 7.5 and its current 7% yield is quite enticing.

Should you invest $1,000 in Stellantis right now?

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Daniel Miller has positions in Ford Motor Company and General Motors. The Motley Fool has positions in and recommends Tesla. The Motley Fool recommends General Motors, Stellantis, and Verizon Communications and recommends the following options: long January 2025 $25 calls on General Motors. The Motley Fool has a disclosure policy.

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