Anytime is a good time to invest in dividend stocks. However, the beginning of a new year can psychologically feel like the best time of all to put money to work in new ways.
There are thousands of dividend stocks from which you can choose. Some are better than others, though. Here are three no-brainer dividend stocks to buy in 2024.
1. Enterprise Products Partners
Enterprise Products Partners (EPD +0.65%) is a leader in the midstream energy industry. It operates more than 50,000 miles of pipelines, as well as other midstream assets such as natural gas processing plants and storage facilities.
What most other companies would call a dividend, limited partnerships such as Enterprise refer to as a distribution. At its current share price, Enterprise's distribution yield is a sky-high 7.6%. Even better, the company has increased its distributions for 25 consecutive years. And it appears to be in a great position to keep that streak going in 2024.
NYSE: EPD
Key Data Points
Many stocks are priced at a premium as the current year winds down. Not Enterprise Products Partners. It trades at a modest forward price-to-earnings ratio of 9.9.
No one knows for sure what 2024 will bring. The good news for shareholders of Enterprise Products Partners is that it's resilient in good times and bad times. Since 2005, the company has never delivered a return on invested capital of less than 10% -- not even during the 2008-2009 financial crisis or the COVID-19 pandemic.
2. U.S. Bancorp
U.S. Bancorp (USB +0.12%) ranks as one of the top super-regional banks in the U.S. It had $668 billion in assets as of Sept. 30, and serves millions of customers. Fortune magazine named U.S. Bancorp as one of the most admired super-regional banks of 2023.
Unfortunately, investors didn't find a lot to admire about U.S. Bancorp stock throughout much of 2023. At one point, its shares were down more than 30% year to date due to the fallout of the regional banking crisis. However, U.S. Bancorp stock has rebounded nicely and is now in positive territory for the year.
NYSE: USB
Key Data Points
Its dividend remains attractive, with a yield of more than 4.4% at the current stock price. U.S. Bancorp recently increased its payout, and given its reasonable payout ratio of 57%, I expect it will continue to deliver modest hikes in the future.
With shares trading at 10.3 times forward earnings, U.S. Bancorp stock is still a bargain. The company has a strong balance sheet, and the credit quality of its loans is improving. The further we get from the banking crisis of early 2023, the better this stock's prospects should be.
3. Verizon Communications
Verizon Communications (VZ 0.24%) is a telecom giant with wireless and broadband customers across the world. The company was created in 2000 via the merger of Bell Atlantic and GTE, two of the biggest telecom leaders at that time.
Income investors have liked Verizon for years -- and still do. Its dividend yield tops 7% at the current share price, and management has increased the payout for 17 consecutive years.
NYSE: VZ
Key Data Points
The stock is continuing to make a major comeback after sinking by more than 20% earlier in 2023. Verizon's better-than-expected third-quarter results provided a strong catalyst. Investors were especially encouraged by the company's improved free cash flow.
Even with its big bounce late this year, Verizon's valuation remains attractive. Shares trade at only 8.1 times expected earnings. With a new streaming bundle option for subscribers featuring Netflix and Max, the stock could have plenty of room to run in 2024.
