Many companies have de-emphasized paying dividends over the years. That's one reason the dividend yield on the S&P 500 is only around 1.3% these days.
However, several companies offer higher-yielding payouts for those seeking a bit more dividend income. Here are four top dividend stocks yielding around 4% these days that you can confidently buy for dividend income this April.
Agree Realty
Agree Realty (ADC +0.22%) has a 4% dividend yield. The real estate investment trust (REIT) focuses solely on owning single-tenant net lease and ground lease retail properties. Those lease structures provide very stable cash flow. Meanwhile, the REIT pays very close attention to the credit quality of its tenants, as 68.2% of its rent comes from clients with investment-grade credit ratings. It routinely upgrades its portfolio by reducing its exposure to lower-quality tenants by selling those properties and replacing them with new ones leased to higher-quality tenants.
NYSE: ADC
Key Data Points
The REIT's focus on tenant quality has paid off for investors. Agree Realty has grown its payout at a 5.6% compound annual rate over the past decade. It's in an excellent position to continue growing its dividend in the future. Its low dividend payout ratio and conservative balance sheet provide ample financial flexibility to continue investing in income-generating properties leased to high-quality retailers.
Chevron
Chevron's (CVX +1.72%) dividend yields 4.1%. The oil giant generates lots of cash flow. Its integrated business model, consisting of oil and gas production, midstream assets, and refining and chemicals operations, helps mute some of the volatility of oil prices. Last year, Chevron produced $15 billion in free cash flow, easily covering its $11.8 billion in dividend payments.
NYSE: CVX
Key Data Points
The oil giant has a terrific record of growing its dividend. It delivered its 38th consecutive annual dividend increase this year. Chevron has grown its payout faster than the S&P 500 and nearly double the rate of its closest peer over the past five years. That growth should continue. Chevron expects to produce an additional $10 billion in annual free cash flow by 2026, fueled by expansion projects and its structural cost savings initiatives.
Kinder Morgan
Kinder Morgan (KMI +2.67%) has a 4.1% dividend yield. The natural gas pipeline giant produces more than enough cash to cover its high-yielding payout. The company expects to generate nearly $5.9 billion of cash flow from operations this year. That would be enough to cover its capital expenditures of $3.1 billion and dividend payments of $2.6 billion, with more than $150 million to spare. That excess free cash flow will help strengthen Kinder Morgan's already rock-solid balance sheet.
The company's growth capital spending will give it more fuel to pay dividends. Kinder Morgan has increased its payment for seven straight years and has already stated plans to raise its payout later this year. With $8.1 billion of growth capital projects in its backlog slated to come online through the end of the decade, Kinder Morgan has visible cash flow growth coming down the pipeline to continue boosting its payout.
NYSE: KMI
Key Data Points
Rexford Industrial Realty
Rexford Industrial Realty (REXR 1.05%) currently has a 4.4% dividend yield. The REIT produces very stable cash flow. It focuses on owning industrial buildings in Southern California, one of the world's biggest industrial markets. It benefits from strong demand and constrained supply, which keeps occupancy high while driving steady rent growth.
The REIT has grown its dividend at an 18% compound annual rate over the past five years, driven by the growing rental income of its existing properties and its steadily expanding portfolio. Rexford has extensive built-in growth ahead. It expects its net operating income to surge 40% over the next few years, driven by embedded annual rental increases in its existing leases, signing new leases at higher market rates as legacy contracts expire, and repositioning and redevelopment projects it currently has under way. Meanwhile, it has additional growth potential by continuing to make accretive acquisitions.
Excellent dividend stocks for some extra income
Agree Realty, Chevron, Kinder Morgan, and Rexford Industrial Realty pay above-average dividends that they've steadily increased. With more growth likely ahead, they're great stocks to buy for dividend income this month.
