“True investors will do better if they forget about the stock market and focus on their own dividend yield and the performance of their companies.” – Benjamin Graham
With this in mind, here are two companies with high dividend yields, improved management, and potential for future growth that income investors should pay close attention to. United Parcel Service (NYSE:UPS) and LTC Properties Inc. (NYSE:LTC). .
Return to growth
UPS is one of the largest companies in the world. We provide a wide range of logistics solutions to customers in more than 200 countries and regions. Wall Street may have low expectations for UPS right now, but that doesn’t mean income investors should shy away from stocks that offer solid dividends and the potential for recovery in the near term. The stock has lagged the rest of the market as customers have moved to lower-cost shipping options, hurting the company’s finances.
In fact, while consolidated sales in the second quarter decreased by 1.1% year-on-year, consolidated operating profit decreased by a staggering 30.1% compared to the second quarter of 2023. Adjusted diluted earnings per share also decreased by a significant 29.5%.
But something else happened that caught the attention of investors. The second quarter could be a turning point, as UPS returned to volume growth in the U.S. for the first time in nine quarters. Trends don’t emerge in one quarter, but it’s certainly a change in pace that’s worth keeping an eye on going forward.
UPS also moved to acquire Mexican delivery company Estafeta in July. The acquisition is expected to close by the end of 2024 and will support UPS’ operations as Mexico’s role in global trade continues to grow.
UPS returned to growth and made major acquisitions. The company has a dividend yield of 4.8% and has maintained or increased its dividend every year since going public in 1999. This makes it a solid dividend stock to buy in anticipation of a price recovery.
aging population
LTC Properties is a real estate investment trust (REIT) that invests in senior housing and healthcare real estate through lease transactions, mortgage loans, and other investments. The company maintained its monthly dividend throughout the COVID-19 pandemic, when most healthcare REITs cut their dividends, making it an interesting income investment option.
LTC Properties boasts a long-standing executive team with decades of healthcare real estate experience and has a record of 233 consecutive monthly dividend payments. We also offer a conservative, strong balance sheet with cash flow and debt maturities aligned with portfolio maturities, allowing investors to sleep easy at night.
the story continues
However, growth is what makes this income investment interesting. The company specializes in senior housing and skilled nursing facilities, and it’s worth noting that the U.S. population is aging. More than 4.1 million Americans will turn 65 each year through 2027, creating a lot of demand for LTC real estate. Additionally, the U.S. adult population aged 85 and older is expected to continue to grow rapidly, reaching 11 million by 2035 and expected to exceed 17 million by 2050.
While income investors are waiting for demand for LTC real estate to rise due to an aging population, the company plans to pay a healthy dividend yield of 6.2%, making it a smart income strategy for investors.
buy now?
UPS offers a potential turnaround story for investors by offering a near 5% dividend yield while waiting for UPS to return to volume growth and its financials return to growth. As America’s population ages and demand for senior housing and assisted living facilities increases, LTC Properties has a bright future ahead of it, and its 6.2% dividend yield is just the icing on the cake. Both stocks look like great high-dividend yield options and could skyrocket in the future.
Should you invest $1,000 in LTC properties now?
Before purchasing shares in LTC Properties, please consider the following:
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Daniel Miller has no position in any stocks mentioned. The Motley Fool recommends United Parcel Service. The Motley Fool has a disclosure policy.
2 High Yield Dividend Stocks Soaring Soaring was originally published by The Motley Fool
