7 ideal dividend stocks to buy for a wealthy retirement

  • Here are the seven best dividend-paying stocks to buy that offer healthy retirement income.
  • PepsiCo (NASDAQ:DYNAMISM): This inflation-proof company will continue to reward shareholders.
  • Intel (NASDAQ:INTC): With a strong product lineup in the coming months, Intel could reestablish its dominance in its business segments.
  • Fifth Third Bancorp (NASDAQ:FITB): FITB has healthy loan and deposit growth and exposure to profitable markets in the US
  • Morgan Stanley (NYSE: MRS): The investment banking giant has effectively diversified its revenue streams.
  • United Parcel Service (NYSE:UPS): The cash-generating machine aims to return more than $7 billion to shareholders this year.
  • SL Green Realty (NYSE:SLG): Office REITs with incredible occupancy rates that are set to come back strong in the post-pandemic world.
  • AbbVie (NYSE:ABBV): ABBV is no longer a one-trick pony, as it has recently launched other oncology products.

Source: Shutterstock

It may never be too early to plan for your retirement, especially in today’s investing environment. Allocating a small portion of your savings each month can have a big impact on your retirement portfolio. Still, it’s worth focusing on building a diversified portfolio with plenty of dividend-paying stocks that significantly reduce downside risk.

You may face many uncomfortable decisions to ensure that you don’t outlive your savings. However, the best way to avoid this predicament is to invest a substantial portion of your retirement savings in dividend-paying stocks. Additionally, with the stock market going through such a massive correction, investors should consider buying undervalued dividend-paying stocks, which are likely to offer a lot of upside potential.

Here are my top seven dividend-paying stocks to buy for a wealthy retirement:

Teleprinter Company Price
DYNAMISM PepsiCo, Inc. $169.17
INTC intel company $42.54
FITB Fifth Third Bancorp $38.33
MRS Morgan Stanley $83.74
UPS United Parcel Service, Inc. $179.13
SLG SL Green Realty Corp. $62.81
ABBV AbbVie Inc. $152.93

Dividend stocks to buy: PepsiCo (DYNAMISM)

PepsiCo (PEP) Pepsi soda cans are in a bucket of ice.

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PepsiCo (NASDAQ:DYNAMISM) is a global snacks and beverages giant that has been incredibly successful in generating massive returns for its shareholders over the past decade. It has benefited immensely from its strong moat and robust brand value. Additionally, its free cash flow generating machine has helped increase dividend payouts over the past 49 years.

Recent results have shown its effectiveness in combating rising entry rates. Its organic sales rose 13.7% in the first quarter (Q1), while its basic earnings per share jumped 20% to $1.29 per share. The company expects its full-year organic sales to grow 8%, up 2% from its previous forecast. Additionally, it recently increased its quarterly dividend by 7%, bringing its yield to a spectacular 2.74%.

Intel (INTC)

Intel sign (INTC stock) at the entrance to the Intel Museum in Silicon Valley

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Intel (NASDAQ:INTC) has established itself as a dominant player in the client CPU and server markets, with over 75% market share in both sectors. It offers investors a remarkable 3.5% yield with eight years of dividend growth.

He faced stiff competition from Advanced micro-systems (NASDAQ:AMD), but the next two years could potentially turn the tide for the company. It has to do with its aggressive product roadmap, backed by billions in investment. It plans to invest 20 billion dollars in the development of some new factories in the state of Ohio and up to 80 billion euros in Europe over the next ten years.

The launch of Intel’s 7nm process will give AMD a run for its money in the years to come. Its 7nm process is significantly more powerful than AMD’s 5nm process offering. Therefore, Intel expects sales to increase over the long term, growing 10% to 12% by 2026.

Dividend stocks to buy: Fifth Third Bancorp (FITB)

Fifth Third Bank sign on brick building

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Fifth Third Bancorp (NASDAQ:FITB) is one of the major regional banks operating in the United States. It has a presence in the Midwest and South regions of the country, with good exposure to the fast-growing markets of Texas and California. Its business has shown steady growth for several years and has returned more than 200% of total return to its investor base.

In the first quarter, average loans and leases were $113.46 billion, compared to $108.95 billion in the first quarter of last year. Despite the slowdown in net interest income, loan and deposit growth was solid in the first quarter. Additionally, the company has an impressive dividend profile, yielding 3.21% with six years of payout growth.

Morgan Stanley (MRS)

The Morgan Stanley logo is displayed on the side of a building.

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Morgan Stanley (NYSE:MRS) is an investment banking giant struggling with the slowdown in investment activity. Investment banking revenues fell 37% in the first quarter of 2021, which significantly reduced corporate profits. The bank faces significant headwinds from rising inflation rates and geopolitical factors, which have crippled investor sentiment. However, Morgan Stanley has done an excellent job of diversifying its sources of income.

It grew client assets by 19% to $1.8 trillion in the first quarter. Additionally, the company’s investment management segment recorded growth of 1.6% over the prior year period. Additionally, assets under management increased by 1.9% to approximately $1.5 trillion. Additionally, its consulting revenue soared to $944 million, representing a 97% growth to offset weak IPO activity. In addition, its ability to evolve has allowed it to maintain its solid dividend yield of 3.41%.

Dividend Stocks to Buy: United Parcel Service (UPS)

Close up of the UPS logo printed on a delivery truck.  UPS stock.

Source: various photographs / Shutterstock

United Parcel Service (NYSE:UPS) is the world’s largest parcel delivery company. It has grown steadily over the past year, posting double-digit sales and EBITDA growth. Additionally, its leveraged free cash flow has grown over 200% over the past year, with a healthy dividend payout.

It raised its quarterly dividend and buyback targets in its first-quarter earnings call. Moreover, it also maintained its incredible revenue and operating margin forecasts. It expects to generate $9 billion in free cash flow, with an expected dividend payout of $5.2 billion. In addition, the company is aiming for a return of more than 30% on invested capital.

SL Green Realty (SLG)

Source: Shutterstock

SL Green Realty (NYSE:SLG) is a leading real estate investment trust (REIT) that provides real estate exposure to high-end commercial space in Manhattan. It is a fully integrated REIT that owns approximately 5% of Manhattan’s office real estate. It is the largest owner of offices in the borough. Its business has suffered greatly from pandemic-related restrictions, so operating results have been disappointing over the past two years. However, as the restrictions ease, things are looking up.

Its occupancy rate is 93% and its management plans to reduce the 7% vacancy. Still, a 93% occupancy rate is a staggering result, given that Manhattan market occupancy rates are between 16% and 18%. Additionally, management expects to grow its net operating income of $605.1 million by 18% through 2024. Perhaps a bigger sweetener is its eye-catching dividend yield of 5.98%.

Dividend stocks to buy: AbbVie (ABBV)

Abbvie (ABBV) website and logo on mobile phone

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AbbVie (NYSE:ABBV) is a biopharmaceutical giant primarily focused on oncology and immunology. It is famous for its flagship drug for rheumatoid arthritis called Humira, which accounts for around 50% of its profits. Total sales rose 22.7% to $56.2 billion last year. Additionally, Humira sales jumped 4.3% year-over-year to $20.7 billion.

In the past, ABBV has been criticized for being a one-trick pony, driving over 60% of Humira’s sales. However, that appears to be changing, with management actively working to diversify its portfolio. This may be why sales of other drugs, including Rinvoq and Skyrizi, have doubled over the past year. Additionally, ABBV is one of the industry’s leading dividend-paying stocks, with nine years of steady growth in dividend payouts and a yield of around 3.7%.

At the date of publication, Muslim Farooque did not hold (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com publishing guidelines.

Muslim Farooque is a passionate investor and an optimist at heart. A long-time gamer and tech enthusiast, he has a particular affinity for analyzing tech stocks. Muslim holds a Bachelor of Science in Applied Accounting from Oxford Brookes University.

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