As an investor in your 50s, you're likely looking to grow your nest egg so that it can help support you when you retire. You're probably also interested in building a passive income stream, ideally one that will grow over time.
Fortunately, well-chosen dividend growth stocks can help you accomplish both of these goals. And with their powerful wealth-building combination of increasing dividend payouts and share price appreciation, Starbucks (SBUX 0.19%), Disney (DIS -0.21%), and Visa (V 0.49%) are three of the best available in the market today.
The coffee king
Starbucks gives its investors many ways to win. Its core coffeehouse business continues to perform well, with global comparable-store sales growth of 8% in the first quarter. The company's new Starbucks Reserve brand concept is exceeding expectations, giving management the confidence to move forward with its plan to open 500 of these ultra-premium coffee stores around the world. And management also remains excited about the potential of the company's fast-growing tea business, both within Starbucks cafes and in stand-alone Teavana stores.
In addition, Starbucks is taking share in grocery aisles, and it now holds the lead market share in both premium roasted ground coffee and premium single-serve coffee on the popular K-Cup platform.
These complementary businesses help to create what CEO Howard Schultz likes to refer to as a "flywheel" effect, whereby each aspect of Starbucks' business helps to reinforce the others. Together, they're helping to drive strong increases in revenue and earnings for the coffee king. And that, in turn, is allowing Starbucks to reward its shareholders with steadily rising dividends, as well as a stock that continues to hit new all-time highs.
Image source: Disney.
The entertainment titan
The Walt Disney Company is a brand powerhouse. From Pixar to Marvel to Star Wars -- and, of course, its namesake Disney brand -- the company owns some of the most valuable entertainment assets in the world.
Disney excels at monetizing these brand assets through its vast network of theme parks, cruise ships, cable properties, and movie studios, as well as its powerful global licensing operations. This monetization machine helps Disney turn its beloved characters and storylines into cold hard cash, which the company can then pass on to its shareholders via stock repurchases and a fast-growing dividend.
And with the incredible success of the blockbuster movie Star Wars: The Force Awakens likely to ripple across Disney's properties in the quarters ahead, along with an impressive pipeline of films slated to be released in the coming years, the excitement around Disney's brands has never been more palpable. As such, investors may wish to consider purchasing The Walt Disney Company's stock today.
The payments giant
As the largest credit card payment network, Visa is well-positioned to profit from the massive global shift toward electronic payments and away from cash transactions. With a platform that processes more than 70 billion transactions annually and operations that span more than 200 countries and territories, Visa's tremendous scale and network effects make it unlikely to be displaced by competitors. Along with its trusted brand, these powerful competitive advantages combine to form a wide protective moat around Visa's ever-rising cash flow.
And those cash flows should soon receive a boost from the company's recently announced acquisition of Visa Europe. The deal should help the combined business better target the European market, where more than $3 trillion in personal consumption expenditure is still done via cash or check.
What's more, the challenging yet massive $6.7 trillion Chinese market just recently opened to U.S. payment processors, providing yet another huge long-term growth opportunity for Visa.
All told, with its position as the leading global electronic payment network and strong international growth prospects, Visa appears poised to deliver many years of dividend growth and capital appreciation to its shareholders.
