The Bureau of Labor Statistics reported in early April 2024 that the Consumer Price Index rose 3.5%. This means inflation has now exceeded the Federal Reserve’s 2% inflation target for 37 consecutive months.
In the face of waning purchasing power, investors with liquid investable assets are faced with either tightening their belts or adding extra income streams. Investing in dividend stocks is one way to generate that extra income passively, without needing to devote more time to labor.
We screened our 24/7 Wall St. dividend equity research database, looking for stocks that pay massive dividends, and we found a collection of companies that, combined, can generate over $10,000 a year in passive annual income if you invest just $ 20,000 in each stock at the time of this writing:
Virtus Convertible & Income Fund
Stock #1 : Virtus Convertible & Income Fund (NYSE: NCV)
Yield: 13.29%
Shares for $20,000: 6,514
Annual Income: $2,658.00
As a hedge against steadily higher prevailing interest rates, convertible bonds, which give the owner the option to exercise a conversion to common stock, are a popular tool. If the stock price rises above the strike price to where there is a substantive intrinsic profit, the investor can maximize gains above and beyond the anticipated coupon yield earnings from the bond.
Such is the strategic premise behind the NY-based Virtus Convertible & Income Fund. Managed by insurer and asset manager Allianz, the fund invests almost exclusively in convertible bonds and, to a lesser extent, hig-yield bonds.
As of the beginning of April 2024, the Virtus Convertible & Income Fund’s portfolio was roughly 50% unrated bonds, 23.35% rated BB, 16.25% rated B, and 7.66% rated BBB. The three sectors with the greatest exposure were: info tech at 18.70%, consumer discretionary at 18.63%, and industrials at 17.88%.
Kimbell Royalty Partners LP
Stock #2 : Kimbell Royalty Partners LP (NYSE: KRP)
Yield: 10.50%
Shares for $20,000: 1,240
Annual Income:$2,100.00
While oil and gas properties often gather premium attention for their energy reserves and extraction potential, lucrative mineral by-product rights and their corresponding royalty interests from those same lands can warrant standalone businesses on their own merits. Such an enterprise is Fort Worth, TX-headquartered Kimbell Royalty Partners LP.
Kimbell’s income is derived from direct mineral rights ownership from 17 million gross acres of oil and gas land supporting 129,000 gross wells. It presently holds mineral rights positions in proximity to 97% of all onshore rigs in the continental United States.
Kimbell incurs zero operating costs or capital expenditures, so profit margins are very fat. Since it is neither a traditional Master Limited Partnership, nor a Royalty Trust, Kimbell investors benefit from tax-advantaged distributions vial 1099-DIV, as opposed to K-1.
Eaton Vance Tax-Advantaged Global Dividend Income Fund
Stock #3 : Eaton Vance Tax-Advantaged Global Dividend Income Fund (NYSE: ETG)
Yield: 8.99%
Shares for $20,000: 1,156
Annual Income: $1,798
A closed-end equity-based mutual fund, the Eaton Vance Tax-Advantaged Global Dividend Fund invests in dividend-paying stocks from around the globe, selected via fundamental analysis and benchmarked against the MSCI World Index.
Based in Boston, MA, the Eaton Vance Tax-Advantaged Global Dividend Income Fund’s portfolio allocation, as of April 2024, held 45.55% foreign stocks, 41.26% U.S. stocks, and 6.18% preferred stocks. The sectors with the highest exposure were: technology (21.5%), financial services (20.22%), and healthcare (15.30%).
The three largest individual portfolio holdings were: Microsoft (NASDAQ: MSFT): 4.22%; Alphabet (NASDAQ: GOOG): 2.85%; and Amazon (NASDAQ: AMZN): 2.73%.
Eagle Bancorp, Inc.
Stock #4: Eagle Bancorp, Inc. (NASDAQ: EGBN)
Yield; 8.81%
Shares for $20,000: 968
Annual Income: $1,762
Eagle Bancorp is the parent holding company of Bethesda, MD-based Eagle Bank, which has 21 total branches throughout MD, VA, and Washington, DC. Its primary financial business is in commercial real estate, which accounts for about 80% of its lending portfolio.
Eagle Bank branches also handle a wide range of commercial and consumer banking services, including business loans, equipment finance, home equity lines of credit, asset-based lending, personal credit, credit cards, safety deposit boxes, sweep accounts, ATMs, and other conventional services.
Sinclair, Inc.
Stock #5 : Sinclair, Inc. (NASDAQ: SBGI)
Yield: 8.47%
Shares for $20,000: 1,658
Annual Income: $1,694
While television broadcast networks are major providers of content in the US, television station operators are still crucial for delivering that content to millions of viewers who aren’t streaming their programming. With its 193 stations in 100+ markets, Hunt Valley, MD-based Sinclair Broadcast Group is the second largest tv station operator in the US. Sinclair is the largest station owner affiliate in the US of ABC, CBS, FOX, NBC, the CW, and MyNetworkTV.
For those who are fans of tennis and pickleball, Sinclair’s Tennis Channel is a must-have.
Sinclair also owns other proprietary content programs channels and engages in sports, news, and other entertainment.
Like any other stock investments, dividend-based stocks require regular monitoring for any news or events that could affect the stock price or dividend negatively. 24/7 Wall Street routinely publishes tips regarding dividend stocks, such as this.
| Name: | Yield: | Annual Dividend Income: |
| Virtus Convertible & Income Fund (NYSE: NCV) | 13.29% | $2,658.00 |
| Kimbell Royalty Partners LP (NYSE: KRP) | 10.50% | $2,100.00 |
| Eaton Vance Tax-Advantaged Global Dividend Income Fund (NYSE: ETG) | 8.99% | $1,798 |
| Eagle Bancorp, Inc. (NASDAQ: EGBN) | 8.81% | $1,762 |
| Sinclair, Inc. (NASDAQ: SBGI) | 8.47% | $1,694 |
| Total: | $10,012 |
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