Arguably the most important decision for investors to make is which stocks to buy. But when to buy them ranks pretty high on the list, too. Sometimes, it makes sense to wait to buy a given stock. However, there are other times when moving quickly is better.
I think several stocks fit into the latter category right now for income investors. Here are three high-yield dividend stocks to buy sooner rather than later.
1. National Storage Affiliates Trust
National Storage Affiliates Trust (NSA 0.95%) is a real estate investment trust (REIT) that focuses on self-storage units. It operates 1,052 self-storage properties in 42 states and Puerto Rico.
NYSE: NSA
Key Data Points
As a REIT, NSA must return at least 90% of its income to shareholders as dividends. The company's forward dividend yield stands at 4.8%. NSA has increased its dividend by 75% over the last five years.
Self-storage has proven to be a resilient sector through the years, delivering higher returns than most REIT sectors with lower volatility. NSA has been one of the best self-storage REITs on the market, generating higher core funds from operations (FFO) per share growth since its IPO in 2015 than most of its peers.
Why buy NSA stock now? For one thing, the Federal Reserve is likely to cut rates later this month. REITs tend to respond well to rate cuts because their borrowing costs are reduced. NSA should especially benefit from rate cuts since they could spur increased home buying, which often drives higher demand for storage units during the moving process for homeowners.
2. Realty Income
Realty Income (O 0.84%) is another REIT that is a fantastic stock for income investors to buy sooner rather than later. It ranks as the seventh-largest global REIT with 15,450 properties.
NYSE: O
Key Data Points
I suspect that most income investors will like Realty Income's forward dividend yield of 5.07%. However, they'll probably love the REIT's dividend track record. Realty Income has increased its dividend for 29 consecutive years with a compound annual growth rate of 4.3%.
This REIT's business is rock-solid. Realty Income's real estate portfolio is diversified across over 1,550 clients operating in 90 industries. Roughly 90% of the company's rent is insulated from economic downturns.
The main reason to buy Realty Income stock now is the likely interest rate cut on the way. Like NSA, Realty Income will benefit from lower borrowing costs if the Fed makes a move as is widely expected. Lower rates will also cause bond yields to fall, which could cause strong REIT stocks such as Realty Income to be more attractive to income investors as they move away from bonds.
3. United Parcel Service
No, not every high-yield dividend stock to buy soon is a REIT. United Parcel Service (UPS 2.41%) is the world's largest package delivery company, serving customers in over 200 countries and territories.
NYSE: UPS
Key Data Points
UPS offers a juicy forward dividend yield of 5.11%. The company has increased its dividend for 15 consecutive years. I fully expect this streak to continue for years to come.
To be sure, UPS has faced some challenges. Shipping volumes have decreased from the levels seen during the worst part of the COVID-19 pandemic. The company has also incurred higher costs associated with its union contract signed last year.
However, these issues underscore why now's the time to buy UPS stock. The company is turning things around, with U.S. shipping volumes rising in Q2 for the first time in nine quarters. The expenses in the union contract were largely front-loaded, meaning that UPS' bottom line should improve going forward. The company has also resumed stock buybacks, a positive sign that should reassure investors.
