It's hard to beat dividends when investing in the stock market. The market, or any particular stock, will fluctuate over time, sometimes significantly. But a healthy, growing company will keep paying out its dividends -- and will increase them over time, too.
In this prolonged period of ultra-low interest rates, dividends also offer compelling income streams, with many yields topping interest rates -- and inflation, as well. So, when looking for stocks to buy, consider dividend payers.
Here are three promising companies, each of which recently offered the same yield -- 4.1%.
Health Care REIT (NYSE:HCN)
First up is Health Care REIT, which has a lot to recommend it. Based in Toledo, Ohio, it's an S&P 500 company with a market cap pushing $26 billion that invests in healthcare-related properties, such as senior-care facilities, and collects a lot of rent payments. As a real estate investment trust, it must pay out at least 90% of its earnings as dividends
It also manages and develops many properties. As of the end of September 2014, its portfolio of nearly 1,250 properties spanned 46 states, the United Kingdom, and Canada.
Health Care REIT is well positioned in an industry that can only increase as our population grows, ages, and needs care. The company is performing well, with revenue more than quadrupling since 2010, and free cash flow turning positive in the past few years. Free cash flow is very welcome, as it can help the company invest in further growth.
In the past few years, Health Care REIT made some big acquisitions, such as assisted-living pioneer Sunrise Senior Living for $4.8 billion. It also spent $2.4 billion on its largest skilled-nursing and post-acute acquisition, Genesis. Its real estate investments have been growing by an annual average of 28% since 2008.
It ranked in the top 5% of the Kingsley 2012 Medical Office Index for tenant satisfaction. More recently, as of the end of September, its actively managed medical office portfolio sported the highest occupancy rate in the industry. These are meaningful details, because it's good for business to retain tenants instead of having to find new ones.
The company's geographic diversification is also a plus. Health Care REIT's stock has averaged annual growth of 15% during the past 20 years, and its growth rate has been accelerating in recent years. This month, it pays its 175th consecutive quarterly dividend.
Arcos Dorados (NYSE:ARCO)
Arcos Dorados is the biggest McDonald's franchisee, with more than 2,000 locations focused in Latin America, and more than 95,000 employees. That's generally a good thing, as it's a populous and growing region. Lately, however, it has been problematic due to economic upheaval in countries such as Venezuela and Argentina, which, posted respective inflation rates of more than 60% and 20% last year.
A bit of good news recently is the reopening of relations with Cuba, which is likely to mean a new market for Arcos Dorados.
Turbulent times aren't likely to last forever, though, and not all of Latin America is that volatile. Arcos Dorados offers investors a great combination of a powerful, world-famous brand name coupled with emerging markets, where upwardly mobile families will increasingly want to dine at the golden arches. Its recent troubles have depressed its stock, presenting an appealing lower entry point, which has also boosted its dividend yield.
One more temporary problem is the strong dollar, which is hurting currency translations. Still, the company is grounded with a lot of real estate, and once its economic environment improves, it stands a good chance of doing quite well. In its third quarter, its organic revenue growth was a solid 9.7%. Its price-to-sales ratio was recently an appealing 0.3, well below the S&P 500's 1.7.
Wynn Resorts (NASDAQ:WYNN)
Finally, there's Wynn Resorts, the casino-and-resort giant that owns 72% of Wynn Macau, operating in the Chinese gambling destination of Macau, as well as properties in Las Vegas. It, too, is currently depressed, which has pushed its dividend yield up. Its stock price has fallen by about a third during the past year, and now sports a forward-looking P/E ratio of just 16 and a PEG ratio of 0.7.
Wynn just reported results for all of 2014 and for its fourth quarter, which were generally disappointing. The company is moving away from its focus on VIP players and aiming for more mass-market business; it's not there yet, and a pullback in VIP gambling has hurt it recently. Still, it posted solid year-over-year gains of more than 5% in the fourth quarter for both its hotel and food revenue.
The company has not been standing still, and is opening a new casino in the Cotai region of Macau in 2016, with other projects underway, as well. In the meantime, in Las Vegas, it's the most profitable casino resort operator. It might take a year or two before Wynn Resorts is again firing on all cylinders, but patient investors can now sign up for a dividend yield of about 4.1% while they wait.