In the hunt for stocks to carry you through your retirement, you're probably looking for low-volatility stocks that supply reliable, steadily rising streams of income. You're past the time where higher-risk growth investments are a staple and instead lean toward those that provide a safer asset allocation.

We asked three Motley Fool investors to find stocks that fit that bill, and they chose JPMorgan Chase (NYSE:JPM), Johnson & Johnson (NYSE:JNJ), and Anheuser-Busch InBev (NYSE:BUD). Read on to learn why.

Bank vault door

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Want dividend growth? You can bank on it

Dan Caplinger (JPMorgan Chase): Retirees like to own shares of blue-chip stocks that provide reliable income and have solid businesses. On those lines, some would question whether JPMorgan Chase fits the bill, given its exposure to the financial crisis less than a decade ago. The Wall Street banking giant has recovered fully from the crisis and has been able to convince regulators at the Federal Reserve that it should be able to boost its dividends and stock buybacks to return more capital to its shareholders. In June, JPMorgan said that it would raise its quarterly payout by 12% to $0.56 per share, along with authorizing more than $19 billion in share repurchases between mid-2017 and mid-2018.

Even after the increase, JPMorgan won't have all that impressive a dividend yield, weighing in at just 2.5%. But most of the reason for the low number is that JPMorgan's stock has climbed so high in recent years, riding the boom in earnings to all-time records. Value-oriented retiree investors will appreciate the inexpensive valuations on the shares, which currently fetch just 12 times forward earnings estimates for the bank.

There's always the chance that new stresses will put pressure on the industry. Yet JPMorgan's competitive position has improved, and weeding out some of the weaker banks in the sector could actually help JPMorgan. That makes the stock a smart play for conservative retiree investors as well as the general investing public.

Lab technicians looking at a specimen

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A diversified Dividend Aristocrat

Leo Sun (Johnson & Johnson): Johnson & Johnson's three core businesses -- pharmaceutical products, consumer healthcare, and medical devices -- are so well diversified that it's tough for any major headwinds to blow the entire company off course.

Robust demand for its multiple myeloma treatment Darzalex, its B-cell malignancies treatment Imbruvica, and Stelara for immune-mediated inflammatory diseases all drove the growth of its pharmaceutical business in recent quarters. J&J also recently spent a whopping $30 billion to buy Actelion, a maker of PAH (pulmonary arterial hypertension) treatments.

J&J's consumer healthcare business is supported by sales of over-the-counter products (especially upper respiratory products and anti-smoking aids) and Neutrogena beauty products. Its medical devices business is supported by its electrophysiology products, advanced surgery products, and Acuvue contact lens products.

On the surface, J&J's growth looks glacial. Nonetheless, its annual revenue rose 35% between fiscal 2006 and 2016, its adjusted EPS grew 80%, and its stock price more than doubled over the past decade. J&J currently pays a forward dividend yield of 2.5%, and it's raised that payout annually for over half a century -- making it an elite Dividend Aristocrat that has hiked its dividend for over 25 years. It also spent just 54% of its earnings and 50% of its free cash flow on those payments over the past 12 months.

J&J faces some near-term challenges, like generic competition for former blockbuster drugs, recalls, and lawsuits regarding some of its products. But over the long term, J&J has consistently outperformed the S&P 500 with minimal risk -- making it an ideal "buy and forget" play for most retirees.

Beer barrels at Wicked Weed Brewing

Image source: Wicked Weed Brewing.

Cash on the barrelhead

Rich Duprey (Anheuser-Busch InBev): Stock appreciation is nice in a retiree's portfolio, but stability, safety, and income serve the investor better. Now's not the time to take wild flights of fancy, which is why Anheuser-Busch InBev is a stock retirees should consider adding.

While no investment is immune to the vagaries of a market decline, this massive brewer manages to provide a modicum of constancy. Following its acquisition of SABMiller, it now has virtual ownership of the U.S. beer market, and has a portfolio of brands that spans the breadth of the industry. From mass-produced beers like Budweiser and Bud Light to its high-end craft beer segment that includes Shock Top, Blue Point, Goose Island, and more recently Wicked Weed Brewing, it has a beer for every taste and a distribution network that can ensure its brands get shelf space.

Beer's decline relative to spirits and wine is greatly overwrought, particularly in craft. For example, although Bud Light's market share has fallen over the past decade, it is still by far the biggest beer on the market and outpaces second-place Coors Light by nearly 2-to-1. And the softness is just in the U.S. market; Anheuser-Busch is a global operation and while individual markets may ebb and flow, the brewer is still seeing growth.

The megabrewer pays a dividend of $3.90 per share that currently yields 3.3% that's paid biannually, not quarterly, with a larger portion paid early in the year and a smaller one later on. With Anheuser-Busch InBev's demonstrated ability to generate strong cash flows, payouts have been steadily rising. Although their future rate of increase may be lower than it was in the past, retirees can be reasonably assured this global brewer will continue to provide the stability, safety, and income they've been looking for.

 

Dan Caplinger has no position in any of the stocks mentioned. Leo Sun owns shares of Johnson & Johnson. Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Anheuser-Busch InBev NV and Johnson & Johnson. The Motley Fool has a disclosure policy.