Top High-Dividend Stocks for Passive Income Investors

A recent report emphasizes the advantages of investing in high-dividend-yield stocks for passive income. It spotlights Altria Group and British American Tobacco, both offering attractive dividend yields and growth potential despite challenges in the tobacco sector.

Date: 22-09-2024

AI Rating: 7

The report provides insights on two tobacco companies, Altria Group and British American Tobacco, highlighting their potential for generating passive income through high dividend yields.

Altria Group (NYSE: MO) offers a dividend yield of 7.83%, with a significant payout of $783 annually on a $10,000 investment. The company has demonstrated strong dividend growth, raising its dividend-per-share by 100% over the last decade. The report notes Altria's free cash flow per share has increased by 125.8% over the same period, providing a solid foundation for its dividend payments.

British American Tobacco (NYSE: BTI) has an even higher dividend yield at 8.21%, translating to $821 in annual dividends from a $10,000 investment. The report indicates that British American Tobacco is capitalizing on new-age nicotine products, which could significantly contribute to future earnings and cash flow growth. The free cash flow per share has grown by 35% since 2019, indicating a robust financial performance despite currency challenges.

Both companies exceed the S&P 500’s current yield of 1.32%, making them attractive for investors seeking passive income. The declining cigarette usage is acknowledged, but both companies possess strong pricing power and operational strategies to steer through these challenges.

Stocks: MO BTI