While many seniors have enjoyed a long bull market over the past 35 years, there is a point when income becomes more critical than stock appreciation. The reason is simple: those who leave their careers to enjoy a well-deserved retirement lose the benefits of a regular salary and the benefits of their jobs, such as 401(k) matching and company-paid healthcare. In addition, many Baby Boomers take advantage of their retirement years to travel and enjoy the rewards they have worked hard to achieve throughout their lifetime. Choosing investments wisely is imperative, and at 24/7 Wall St., we constantly search for the best ideas for Boomers and retirees.
At 24/7 Wall St., we have closely followed dividend-paying stocks for over 15 years. With a growing audience of savvy Baby Boomer retirees seeking safe income ideas that deliver more than the 10-year Treasury bond’s 3.99% bi-annual dividend, we have screened hundreds of stocks, looking for recurring, dependable dividend payouts and a degree of safety that allows for a good night’s sleep. The five very best high-yield companies are the kind Baby Boomers and retirees can buy and own with confidence.
Why do we cover top high-yield dividend stocks?
The more passive income can help cover rising costs — such as mortgages, insurance, taxes, and other expenses — the easier it is for investors to set aside money for future needs as they prepare for retirement. Dependable recurring dividends from quality, high-yield stocks are a recipe for success.
Altria
Altria Group Inc. (NYSE: MO | MO Price Prediction) is one of the world’s largest producers and marketers of cigarettes and other tobacco-related products. The company offers value investors a compelling entry point and a generous 6.35% dividend yield. Altria manufactures and sells smokable and oral tobacco products in the United States.
The company primarily sells cigarettes under the Marlboro brand, as well as:
- Cigars and pipe tobacco, principally under the Black & Mild and Middleton brands
- Moist smokeless tobacco and snus products under the Copenhagen, Skoal, Red Seal, and Husky brands
- on! Oral nicotine pouches
- e-vapor products under the NJOY ACE brand
It sells its tobacco products primarily to wholesalers, including distributors and large retail organizations, such as chain stores.
Altria used to own over 10% of Anheuser-Busch InBev S.A. (NYSE: BUD), the world’s largest brewer. Last year, the company sold 35 million of its 197 million shares through a global secondary offering. That represents 18% of its holdings but still leaves 8% of the outstanding shares in its back pocket. Altria also announced a $2.4 billion stock repurchase plan partially funded by the sale.
Goldman Sachs has a Buy rating with a $72 target price.
AT&T
AT&T Inc. (NYSE: T) is the world’s fourth-largest telecommunications company, measured by revenue. The legacy telecommunications company has been undergoing a lengthy restructuring process while maintaining a solid dividend of 4.24%. Seventeen analysts have given the stock a Buy rating, indicating comprehensive Wall Street support. AT&T provides a range of telecommunications, media, and technology services worldwide. Its Communications segment offers wireless voice and data communications services.
AT&T sells through its company-owned stores, agents, and third-party retail stores:
- Handsets
- Wireless data cards
- Wireless computing devices
- Carrying cases
- Hands-free devices
AT&T also provides:
- Data
- Voice
- SecuT
- Cloud solutions
- Outsourcing
- Managed and provided professional services
- Customer premises equipment for multinational corporations, small and mid-sized businesses, and governmental and wholesale customers
Additionally, this segment provides residential customers with fiber broadband and legacy voice telephony services.
It markets its communications services and products under:
- AT&T
- Cricket
- AT&T PREPAID
- AT&T Fiber
The company’s Latin America segment provides wireless services in Mexico and video services throughout the region. This segment markets its services and products under the AT&T and Unefon brands.
J.P. Morgan has a $33 price target for the stock.
Bristol-Myers Squibb
Bristol Myers Squibb Co. (NYSE: BMY)is a global biopharmaceutical company committed to discovering, developing, and delivering transformative medicines for patients with serious diseases across oncology, hematology, immunology, cardiovascular disease, neuroscience, and other therapeutic areas. It remains a solid pharmaceutical stock to own in the long term, offering an outstanding entry point with a reliable 5.67% dividend.
Its platforms comprise chemically synthesized or small-molecule drugs, including protein degraders, as well as biologics produced through biological processes. These platforms also encompass ADCs, CAR-T cell therapies, and radiopharmaceutical therapeutics.
Small-molecule drugs are typically administered orally in tablet or capsule form, although other drug-delivery mechanisms are also used. Biologics are usually administered by injection or intravenous infusion.
CAR-T cell therapies are administered by intravenous infusion.
Its growth portfolio includes:
- Opdivo
- Opdivo Qvantig
- Orencia
- Yervoy
- Reblozyl
- Opdualag
Bristol-Myers Squibb’s legacy portfolio includes:
- Eliquis
- Revlimid
- Pomalyst/Imnovid
- Sprycel
- Abraxane
Jefferies has a Buy rating with a $68 target price.
Chevron
Chevron Corp. (NYSE: CVX) is an American multinational energy company primarily focused on oil and gas. This integrated giant is a safer option for investors looking to position themselves in the energy sector and pays a substantial 4.40% dividend, which was raised by 5% earlier this year.
Chevron operates integrated energy and chemicals businesses worldwide and offers investors very strong credit ratings (AA), diversified operations, strong margins, and a long history of paying dividends and raising them annually. It operates in two segments.
The Upstream segment is involved in the following:
- Exploration, development, production, and transportation of crude oil and natural gas
- Processing, liquefaction, transportation, and regasification associated with liquefied natural gas
- Transportation of crude oil through pipelines, and transportation, storage
- Marketing of natural gas, as well as operating a gas-to-liquids plant
The Downstream segment engages in:
- Refining crude oil into petroleum products
- Marketing crude oil, refined products, and lubricants
- Manufacturing and marketing renewable fuels
- Transporting crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car
- Manufacturing and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives
It also involves cash management, debt financing, insurance operations, real estate, and technology businesses.
Chevron announced in late 2023 that it had entered into a definitive agreement with Hess Corp. (NYSE: HES) to acquire all the outstanding shares of Hess in an all-stock transaction valued at $53 billion, or $171 per share based on Chevron’s closing price on October 20, 2023. Under the terms of the agreement, Hess shareholders will receive 1.0250 shares of Chevron for each Hess share. The transaction’s total enterprise value, including debt, is $60 billion. The Federal Trade Commission approved the deal last October, and it is expected to close this fall.
Wells Fargo has an Overweight rating with a huge $190 target price.
Prudential Financial
Prudential Financial Inc. (NYSE: PRU) offers a range of insurance, investment management, and other financial products and services. With a rich 5.20% dividend yield, this insurance and investment giant is a safe option for conservative investors. Prudential provides insurance, investment management, and other financial products and services in the United States and internationally.
It operates through five segments:
- PGIM
- Retirement Strategies
- Group Insurance
- Individual Life
- International Business segments
The PGIM segment offers investment management services and solutions related to public fixed income, public equity, real estate debt and equity, private credit, and other alternatives, as well as multi-asset class strategies, to institutional and retail clients and its general account.
The Retirement Strategies segment provides a range of retirement investment and income products and services to retirement plan sponsors in the public, private, and not-for-profit sectors. It develops and distributes individual variable and fixed annuity products.
The Group Insurance segment offers:
- Various group life plans
- Long-term and short-term group disability
- Group corporate, bank, and trust-owned life insurance in the United States, primarily for institutional clients, for use in connection with employee and membership benefits plans
- Accidental death and dismemberment, and other supplemental health solutions
- Plan administration services in connection with its insurance coverages
The Individual Life segment develops and distributes variable life, universal life, and term life insurance products.
The International Businesses segment develops and distributes life insurance, retirement products, investment products, specific accident and health products, and advisory services. The company provides its products and services to individual and institutional customers through its proprietary and third-party distribution networks.
Jefferies has a Buy rating with a $134 price target.
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