Dividend stocks are a popular investment choice for many individuals looking to build wealth over the long term. These stocks provide investors with a reliable source of income in the form of regular dividend payments, which are typically distributed quarterly. In addition to the income generated from dividends, investors can also benefit from share price appreciation as the underlying securities of the dividend stocks increase in value.
One of the key advantages of investing in dividend stocks is the passive income stream they provide. This income can add up over time, especially for investors who continue to reinvest their dividends until retirement. By reinvesting the dividends received, investors can benefit from the power of compounding, which can significantly increase their overall returns in the long run.
When selecting dividend stocks to invest in, it is important to consider both the dividend yield and the potential for share price appreciation. Below are three dividend stocks that offer decent dividend yields for their shareholders and have shown considerable share price appreciation, indicating the potential for future dividend growth.
Manulife Financial (MFC) is a financial services company that offers a range of products, including individual life insurance, annuities, and investment portfolio management. The company has experienced significant earnings growth in its wealth management segment, leading to a nearly 50% increase in its share price over the past year. Manulife Financial offers a dividend yield of 4.14% and has increased its dividend for the last ten consecutive years, indicating its commitment to rewarding shareholders with regular distributions.
Seagate Technology (STX) is a data storage company that produces solid-state drives and hard disk drives for large-scale data storage capabilities. Despite reporting a decline in total revenue in its fiscal third quarter of 2024, Seagate Technology has shown strong potential for earnings growth in the future. The company offers a dividend yield of 2.62% and is expected to see an increase in its earnings in the upcoming quarter, which has been reflected in its share price appreciation.
NewLake Capital (NLCP) is an industrial real estate investment trust (REIT) that provides real estate for the regulated cannabis industry through triple-net leases. The company has seen a 30% increase in its share price over the past year, driven by earnings growth and recent acquisitions. NewLake Capital offers a strong dividend yield of 8.94% and recently increased its dividend by 5%, indicating its confidence in future growth within the cannabis industry.
In conclusion, dividend stocks are a reliable investment option for individuals looking to build wealth over the long term. By selecting dividend stocks with decent dividend yields and potential for share price appreciation, investors can benefit from regular income distributions and the potential for capital appreciation. Consider investing in dividend stocks like Manulife Financial, Seagate Technology, and NewLake Capital for a combination of passive income and long-term growth potential.
