Top dividend investors don't just pick stocks with high yields. They also look at companies that have good prospects for future growth. Below, you'll find out how General Motors (NYSE:GM), Las Vegas Sands (NYSE:LVS), and Weyerhaeuser (NYSE:WY) are giving their shareholders dividend yields of 4% or more and also have the potential to deliver significant share-price appreciation to investors as well.
General Motors drives ahead
General Motors has come back from its woes, and for dividend investors, its 4.1% yield is solid. The company only emerged from bankruptcy in 2010, but since then, the company has raised its dividend twice and now pays a quarterly amount that's more than 25% higher than its first dividend in 2014 was. With increases having come in mid-2015 and early 2016, another boost to the dividend might be coming in the near future.
General Motors is coming off record U.S. sales results in 2015, and even though growth in North America appears to be hitting a plateau, GM has also gotten solid performance elsewhere in its global market. Low gasoline prices have spurred sales of SUVs and other larger vehicles, and losses in Europe have been coming down from much higher levels in the recent past. China is also emerging as a key market for General Motors, and efforts to join new trends toward electric vehicles and autonomous driving capabilities could spur further growth for years to come for GM.
Las Vegas Sands bets on a comeback
Despite its name, Las Vegas Sands relies not on the health of the Vegas gaming market but rather how conditions are in the Asian gaming capital of Macau. Sands has several properties in Macau, and the crushing slowdown in activity there during the past two years sent the casino giant's stock down sharply. Recently, though, Macau has started to pick up some steam, hitting a bottom in terms of monthly revenue levels and showing signs of a potential recovery. At the same time, the company's new Parisian property in Macau has 3,000 hotel rooms and more than 400 table games, and it has generated strong initial interest even in the face of competition from peers in the area.
Las Vegas Sands has a dividend yield of almost 5%, and the company boosted its dividend by more than 10% early in 2016. Increases have come quickly in recent years, with the payout having nearly tripled just since late 2012. Even as other casino companies have chosen to cut their dividends, Sands has held steadily. With new opportunities potentially arising in Japan, Sands could well see another leg up in growth in the near future.
Weyerhaeuser sees the forest for the trees
Real estate investment trusts are favorites among dividend investors, but Weyerhaeuser isn't your typical REIT. The company has extensive timber assets, producing wood products and giving the REIT exposure to the housing market. Given how well housing has done lately, Weyerhaeuser has fared quite well, and its dividend remains healthy at just over the 4% mark. Dividends have been healthy for a long time, and Weyerhaeuser has doubled its quarterly payout within the past four years.
Investors are more optimistic about Weyerhaeuser than ever right now, because recent trends suggest that construction activity on the home front could get another boost following the results of the presidential election. As the largest owner of timber properties in the U.S., Weyerhaeuser has a lot to gain if strong construction demand pushes timber prices higher. Barring an unforeseen reversal of fortune for the housing market, Weyerhaeuser looks like it's on track to keep rewarding its shareholders with dividend income.
The best dividend stocks don't just pay high yields. These three companies show you that high yields and attractive business fundamentals can create a powerful combination, and it's worth holding out for the highest-quality dividend stocks available in the market.
Dan Caplinger has no position in any stocks mentioned. The Motley Fool recommends General Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.