Top dividend-paying stocks with high and sustainable payouts are a reliable source of passive income. Companies with a solid track record of distribution growth and a growing earnings base portfolio are particularly appealing in all market conditions.
To identify these opportunities, I used Barchart’s Stock Screener Tool to narrow down the top dividend stocks with fat yields of 6% or more. After running the scan, I identified three standout picks: Enbridge (ENB), Altria (MO), and Enterprise Products Partners (EPD).
Let’s look closely at these stocks to understand why income investors should consider them now.
Dividend Stock #1: Enbridge (ENB)
Enbridge (ENB) might be a good choice if you're looking for a dependable, dividend-paying stock with a long track record of rewarding shareholders. With 69 years of consistent payouts, Enbridge has become a staple for income-focused investors. Over the past 29 years, the company has delivered impressive dividend growth, increasing its payouts at an average annual rate of 10%.
Enbridge’s payouts are supported by its diversified portfolio, long-term contracts, and power purchase agreements. The company operates an extensive network of liquid pipelines, natural gas (NGZ24) utilities, energy storage facilities, and renewable energy projects. Such diversification has allowed the company to consistently grow earnings and increase dividends, even during turbulent times.
The company also maintains a sustainable payout ratio of 60% to 70%, which is encouraging.
Enbridge’s substantial secured project backlog, strategic acquisitions, and high asset utilization are expected to drive EBITDA, distributable cash flow (DCF) per share, and earnings per share (EPS). With growing earnings and DCF per share, Enbridge is well-positioned for continued dividend growth.
ENB offers a high dividend yield of over 6.5%. Furthermore, Wall Street analysts have given Enbridge a “Moderate Buy” consensus rating.
Dividend Stock #2. Altria (MO)
Altria (MO), a Dividend Aristocrat (NOBL), boasts a stellar track record of increasing dividends alongside an appealing yield. This prominent player in the tobacco industry focuses on rewarding shareholders by consistently providing higher dividends.
Over the past 55 years, Altria has raised its dividend 59 times, demonstrating resilience in generating earnings across various market conditions while returning capital to investors.
With a dominant position in the tobacco sector, Altria continues to grow its earnings, which supports its ability to maintain and increase dividends. The company is also expanding its presence in the smoke-free product market, a segment anticipated to experience significant demand and generate substantial revenues, thereby supporting future distributions.
Altria's management targets a mid-single-digit growth rate in adjusted EPS through 2028. The tobacco company expects to achieve a similar growth rate in dividends as it works to reduce debt, thereby fortifying its balance sheet and positioning itself for forthcoming opportunities.
While Wall Street analysts maintain a “Hold” consensus rating on Altria stock, its expanding earnings base, strong dividend history, and an attractive yield of 7.6% make it a compelling choice for investors seeking regular dividend income.
Dividend Stock #3. Enterprise Products Partners (EPD)
Enterprise Products Partners (EPD) emerges as another strong contender in the dividend space, offering an impressive yield of 7%. This yield is supported by EPD’s resilient business model, which relies on long-term fee-based contracts and minimum volume commitments, ensuring stable earnings growth and protection from commodity price volatility.
This leading player in the energy infrastructure sector has a diversified product portfolio and operates across various geographic locations. The company maintains a low leverage ratio, enhancing its balance sheet and capacity to pursue growth initiatives. Further, the company’s focus on acquisitions is set to bolster EPD's midstream energy systems, likely increasing its distributable cash flow and laying a solid foundation for future expansion.
EPD has a commendable track record of dividend growth, having increased its dividend for 26 consecutive years at a CAGR of 7%. This consistent commitment to returning capital to shareholders underscores EPD’s appeal to income investors.
Wall Street analysts share a positive outlook on EPD's future, with a consensus rating of “Strong Buy.”
