Building a million-dollar retirement portfolio takes a combination of three things. You need to invest enough money into investments that are generating a high enough return to reach that target by the time you want to retire.
For example, investing $100 a month into three stocks (a total of $300 each month) that are generating a 12.5% annualized total return would grow to more than $1 million in 30 years. To reach $1 million faster, you'd need to either increase your monthly investment or make higher-returning investments.
Not many companies have delivered a return of 12.5% (or more) over multiple decades. However, three companies that have done that in the past are Brookfield Corporation (BN 4.39%), NextEra Energy (NEE +0.08%), and Realty Income (O +0.35%). They're also in strong positions to continue generating returns at or above that level in the future.
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A wealth-creating machine
Brookfield Corporation is a leading global investment firm. Over the last 30+ years, Brookfield has delivered an annualized total return of 19%. That has trounced the S&P 500's 11% annualized return during that timeframe.
The company aims to deliver an annualized return of more than 15% to shareholders over the long term. It's in a strong position to do so in the coming years. Brookfield expects to benefit from several megatrends, including leading the way in investing in AI infrastructure, capitalizing on the fundamental shift in the retirement landscape, and cashing in on the real estate recovery.
NYSE: BN
Key Data Points
These and other catalysts drive Brookfield's view that it can grow its distributable earnings at a 25% annual rate for at least the next five years. Meanwhile, its long-term focus on investing in durable megatrends positions it to continue growing at above-average rates for many years to come. That puts Brookfield in a strong position to deliver total annual returns exceeding 12.5% over the next 30 years.
Powerful total return potential
NextEra Energy is a leading electric utility and clean energy infrastructure company. Utility stocks tend to be slower-growing companies that deliver lower total returns. However, NextEra Energy isn't your average utility. It has delivered an average annual total return of more than 13% over the last 30 years.
NYSE: NEE
Key Data Points
It has grown its adjusted earnings much faster than the average utility (around 9% annually over the last 20 years compared to the low-single-digit annualized rate of its utility peers). That's due to operating the largest electric utility in Florida (which benefits from the state's above-average growth rate and abundant sunshine) and its investments in developing clean energy infrastructure across the country.
NextEra Energy's growth catalysts are only growing stronger. Power demand should accelerate over the next two decades, driven by AI data centers, advanced manufacturing facilities, and electric vehicles. That drives NextEra's expectation of growing its earnings by more than 8% annually over the next decade. It has multiple upside catalysts to its base growth rate, including the development of AI data center hubs, the construction of new nuclear power plants, and acquisitions. Add in its growing dividend (a nearly 3% yield), and NextEra Energy has powerful total return potential.
A steady, wealth-creating REIT
Realty Income is one of the world's largest real estate investment trusts (REITs). The company has delivered a 13.3% compound annual total return since its public market listing in 1994.
NYSE: O
Key Data Points
Two factors have contributed to the REIT's robust returns. It pays a high-yielding monthly dividend and steadily grows its adjusted funds from operations (AFFO) per share. This combination of income and growth really adds up over the long term.
Realty Income's dividend currently yields around 5%. Meanwhile, the REIT has one of the best financial profiles in the industry, which should enable it to continue growing its portfolio of high-quality income-producing real estate. It has also begun forming more strategic partnerships, which are enhancing its investment returns. With a $14 trillion total addressable market opportunity, Realty Income has a long growth runway ahead.
Millionaire-maker stocks
Brookfield Corporation, NextEra Energy, and Realty Income have delivered strong returns over the last thirty years. All three companies remain in excellent positions to continue enriching their investors going forward. Given that, you should consider investing $100 a month in each one and never look back. They have the potential to grow that investment into more than $1 million over the next three decades.
