Going, going, gone? We could soon find out whether that statement applies to the S&P 500. The major index is only around 6% below its all-time high.
Reaching that milestone is the only remaining box to check for an irrefutable new bull market to be declared. With a new bull market in sight, here are three top dividend stocks to buy sooner rather than later.
1. Bank of America
Bank of America (BAC -0.21%) provides investors with a lot to like these days. Its dividend yield currently tops 3%, near its highest level in the last 10 years.
Bank of America (BofA) stock is also dirt cheap. Even with a nice rally in recent months, BofA's shares still trade at a forward price-to-earnings ratio of only 9.2 times.
Wall Street is overwhelmingly bullish about the bank stock. The consensus 12-month price target reflects an upside potential of 12%. Of the 30 analysts who cover BofA, 22 rate the stock as either a buy or a strong buy.
I think the upbeat views are warranted. BofA continues to deliver strong financial results, with second-quarter revenue rising 15% year over year and earnings jumping 19%. In my view, it would be a smart move to buy the stock before the rest of the market realizes just how good BofA is.
2. Brookfield Infrastructure
Fitch's downgrade of the U.S. credit rating last week caused many utility stocks to fall. Brookfield Infrastructure (BIP -0.80%) (BIPC -1.04%) was no exception. Shares of the Canadian company tumbled more than 10% before rebounding a little.
However, I see this pullback as an excellent buying opportunity for long-term investors. For one thing, you can lock in Brookfield Infrastructure's juicy distribution yield of nearly 4.7%. (That percentage is for the limited partnership units that trade under the BIP ticker; the yield for the corporate shares that trade under the BIPC ticker is nearly 3.7%.)
More importantly, though, Brookfield Infrastructure's prospects remain strong. The company beat expectations with its second-quarter results announced last week. Its funds from operations (FFO) increased by nearly 8%. Organic growth was near the upper end of Brookfield Infrastructure's target range of 6% to 9%.
Brookfield Infrastructure isn't just a utility operator. It also owns a variety of other assets, including pipelines, rail networks, data centers, cell towers, and toll roads. The company should be able to deliver solid total returns over the long run, thanks to its diversified business that meets critical needs.
3. Enterprise Products Partners
For investors seeking an exceptionally high yield, Enterprise Products Partners (EPD 0.45%) could be just the ticket. The midstream energy company's distribution yield currently tops 7.5%.
And you can pretty much count on those distributions rising in the future. Enterprise Products Partners has increased its distribution for an impressive 25 consecutive years. It continues to generate more than enough distributable cash flow to grow its distribution.
Enterprise stock is also attractively valued. Units of the limited partnership trade at roughly 10.3 times expected earnings and 12.5 times trailing-12-month free cash flow.
Why invest in Enterprise Products Partners sooner rather than later? First, you can begin receiving those great distributions more quickly. Also, with economists (including those at the Federal Reserve) no longer predicting a recession, the demand for Enterprise's pipelines and other midstream assets could increase.
