The stock market has been a bit more volatile than usual lately. Several factors have made investors nervous, including inflation worries and the omicron variant of the coronavirus. This stock market volatility might be making you feel less confident about putting more money to work.
However, there are safer stocks you can confidently buy right now. Here are five great options for those with a few hundred dollars to invest.
Realty Income (O 1.33%) lives up to its name. The real estate investment trust (REIT) has a long history of producing dependable income. It has made 617 consecutive monthly dividend payments throughout its history. The REIT has also increased its payout 113 times, including by 5.1% over the past year. It currently offers a dividend yield of 4.4%.
Realty Income owns a diversified portfolio of commercial real estate, focusing on freestanding retail properties with triple net leases to tenants that are resistant to economic downturns and e-commerce pressures. That portfolio and lease structure enable it to generate steady cash flow. It also has one of the strongest financial profiles in the sector, giving it the flexibility to continue expanding its portfolio. This combination of diversification and financial flexibility has enabled Realty Income to consistently deliver double-digit total shareholder returns with minimal volatility.
Brookfield Infrastructure (BIPC 0.38%) (BIP 0.88%) operates a globally diversified portfolio of infrastructure businesses across the utility, transportation, energy midstream, and data sectors. These businesses tend to generate relatively steady cash flow; that allows Brookfield to pay an attractive dividend yielding 3.5% right now.
The company has a long history of growing its cash flow and dividend. It expects both to continue rising, projecting annual per-share growth in the mid- to upper single digits for several years. Brookfield sees a few factors powering this outlook, including rising contract rates, expansion projects, and new additions to its portfolio. Brookfield Infrastructure recently completed another needle-moving deal, acquiring a Canadian midstream company that should fuel growth for the next few years. That positions it to continue producing attractive total returns.
Waste Management (WM 2.86%) turns trash into cash. The waste collection and recycling company expects to produce between $2.5 billion and $2.6 billion of free cash flow this year. That's giving it more money to return to shareholders. It recently boosted its dividend by 13% and authorized an additional $1.5 billion in share repurchases.
One factor driving its rising cash flow is its recent acquisition of Advanced Disposal. The company expects that combination to save it $150 million annually. Waste Management is also investing in new and upgraded recycling facilities, enabling it to recycle more materials, helping drive additional cash flow growth. With a strong balance sheet and a business that's generating lots of cash, Waste Management should be able to continue producing steady returns for investors.
NextEra Energy (NEE 0.63%) operates the largest utility in Florida. It also owns a vast portfolio of energy infrastructure assets, including natural gas pipelines, wind farms, transmission lines, solar-energy facilities, and energy storage. These assets generate stable cash flow, giving it money to invest in expanding its operations and pay a growing dividend.
The company expects to grow its earnings per share at or near the upper end of its 6% to 8% annual target range through at least 2023. That should support dividend growth of around 10% through 2022. This growth should help it continue to produce above-average total returns in the coming years.
STAG Industrial (STAG 0.04%) is a REIT that owns a diversified portfolio of industrial properties it leases under long-term contracts. That supplies it with steady income to cover its monthly dividend, which now yields 3.2%.
One thing that makes STAG Industrial stand out in the crowded industrial REIT sector is its relatively low valuation. Because it's cheaper, it offers more downside protection in today's heated market.
STAG Industrial also offers attractive growth prospects. Thanks to the growing demand for industrial real estate, the average rental rate on new and renewal leases at its existing properties jumped 14.7% in the third quarter. Meanwhile, the company has lots of financial flexibility to expand its portfolio via acquisitions. Combined with its high-yield dividend, that growth should enable STAG Industrial to produce attractive total returns in the coming years.
Solid investment options
If you have a few hundred dollars to invest, you might not want to risk that money on stocks that could see large price declines in today's volatile market. However, instead of staying on the sidelines, you might want to consider spreading your money around a few lower-risk and less volatile stocks like the five above.
Realty Income, Brookfield Infrastructure, NextEra Energy, Waste Management, and STAG Industrial are all growing cash flow at healthy rates, enabling them to pay steadily rising dividends. Those factors should help these stocks produce attractive total returns in the coming years, making them look like solid buys right now.