If I was looking for the best stock to buy for income, there are a few things I would be looking for:
- Decent, but not excessive, too good yield
- History of increased payments over the years
- The company’s products or services are in almost constant demand
- Finances are strong enough to survive the inevitable stock market storm.
With this in mind, here are three stocks FTSE 100 I find it comfortable to build a portfolio.
At 2.1% Diageoof (LSE: DGE) The dividend yield seems to be quite low. But I think it’s one of the safest.Owned by the company Many of the best-selling premium spirits brands.. It’s also geographically widespread, so it doesn’t depend on one or two economies working well.
Certainly, there are risks. The pandemic shows that even the strongest companies can still face problems as a result of the Black Swan event. Even though many of us continue to consume at home, the closure of liquor stores around the world has hit Diageo’s sales and stock prices.
As long as you continue to fight the virus, this should all be temporary.The fact that it continues To increase Dividends again last year suggest that management is confident in a significant recovery in sales.
Consider the FTSE 100 peer Unilever (LSE: ULVR) To be one of the best stocks to buy. Again, the income is not excessive. Compared to what you get from FTSE 100 miners and homebuilders, this year’s 3.4% yield is inferior. But this lacks the point.
Like Diageo, Unilever’s appeal as a source of dividends lies in the fact that its products are in constant demand. Companies with cyclical revenues are often forced to reduce their dividend payments as trends change.
Of course, earnings growth can still be disappointing from time to time (as recently), emphasizing that even Unilever’s share price can face challenges.However, its performance In the long run It shows how rewarding it is to buy and wait correctly.
Unilever also has a high score for increasing regular payments to investors. It makes sense for me to reinvest what I received when the company can do it year after year, Therefore, compound interest will return over time..
Without exposure to the utilities sector, it would have been unthinkable to build a revenue portfolio. Thanks to our constant need for electricity, gas and water, these companies tend to be abundant sources of dividends.That’s why my last “best stock to buy for income” is National grid (LSE: NG.)..
Analysts have a power provider that returns 49.6p per share in the current fiscal year. At the current stock price, the yield is 5.2%. This is much higher than the 3% offered across the FTSE 100.
Again, there are a few things to keep in mind. Dividend coverage — how well payments are covered by profits — is a bit low. The high cost of running infrastructure smoothly also means that dividend increases are always conservative. In support of its rather dull reputation, stock price advances were also quite pedestrian.
Nevertheless, the predictability of revenue means that I am willing to overlook these things. We would like to make the National Grid the core holding of our income-focused portfolio.
If the CEO of a company owns 12.1% of the shares, I think that’s usually a very good sign.
But with this opportunity, it could be even better.
At the age of 55, he sees new “Uber-style” technology opportunities.
And this isn’t a small tech startup full of empty promises.
This extraordinary company is already one of the largest in the industry.
Last year, revenue reached a whopping £ 1.132 a billion.
The board recently announced a 10% dividend increase.
And It was a great Motley Fool income pick for the ninth year in a row!
But still, we believe there can still be great adversity.
Obviously, the founder and CEO of this company agrees.
Paul summers There are no positions in any of the listed shares. Motley Fool UK recommends Diageo and Unilever. The views expressed about the companies mentioned in this article are those of the author and may differ from the official recommendations made by subscription services such as Share Advisor, Hidden Winners, and Pro. Here at The Motley Fool, by exploring different insights, Better investors than us.
What is the best stock to buy for income?I choose these FTSE 100 stocks
https://www.fool.co.uk/investing/2021/05/26/best-shares-to-buy-for-income-id-pick-these-ftse-100-stocks/ What is the best stock to buy for income?I choose these FTSE 100 stocks