2 Dividend Stocks You Can Safely Hold for Decades

If you’re looking for safe dividend stocks you can hold for decades, there are some great companies you might not know about yet. The following stocks have been increasing their dividend payments for over 25 years and have above-average returns. Here’s why: real estate income (o 0.47%) and fastener (fast 0.74%) A solid choice for retirement savers.

Real Estate Income: 5.60% dividend yield

Concerns about consumer spending and the possibility of a recession have pushed Realty Income’s shares down 18% over the past year. However, the stock rebounded by the end of 2023 as investors began to appreciate this top real estate investment trust (REIT)’s outstanding dividend history and quality tenant portfolio. Realty Income has a diverse portfolio of commercial customers and over 13,000 tenants under long-term net lease agreements, providing high visibility into future dividend payments.

Realty Income has increased its monthly dividend for 31 consecutive years. As a REIT, we must distribute at least 90% of our taxable income to shareholders in the form of dividends. The current stock dividend yield is 5.60%, which is higher than the real estate industry average.

Realty Income’s tenants include large retailers such as: walmart, fedex, walgreens, other well-known brands and retailers account for 82% of the real estate portfolio. Owning stocks is almost like earning royalties in the retail sector, but the best part about owning this REIT is that investors don’t have to worry about the struggles of consumer spending. These companies won’t close operations just because of a bad year.

Management’s strategy is to maintain a healthy mix of strong companies that can stand the test of time. That’s why Realty Income has paid dividends for over 54 years and will likely continue to do so for decades to come.

Fastenal: Dividend yield 2.27%

Fastenal is a well-managed company that pays a shareholder-friendly dividend. As a leading distributor of construction materials, including fasteners and other components, the company has provided investors with market-leading returns for decades while paying out a percentage of its profits as dividends.

The company has been increasing its quarterly dividends for 25 years, and its current yield of 2.27% is above market value. S&P 500The rate of return is 1.47%.

Fastener distribution requires excellent supply chain management and a sophisticated distribution network, which are key competitive advantages for the company. Over the past 10 years, sales have grown 8% per year and earnings per share have grown 10% per year.

The company’s strategy to be closer to customers through more than 3,400 field and retail stores and tight control of operating costs has delivered outstanding returns for investors. The stock has more than doubled over the past five years and is set to hit another high starting in 2024.

Fastenal still has a long growth runway. It is starting to gain traction internationally, with sales exceeding $1 billion in 2022, compared to $6 billion in the United States.

If you need steady growth along with your income, look no further. If you invested $10,000 in Fastenal stock 10 years ago, it would already be worth $40,000 after dividends are reinvested. Investors could see similar returns over the next decade as the company begins to expand internationally.