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High-Yield Dividend Stocks to Boost Your Income Now

Tom Hutchinson, Chief AnalystCabot Dividend Investor

The aging of the population

https://johngraham.us/baby-boomers/2nd chart

Average retirement income

u Median Retirement account $58,035 $3,000u Median private Pension $9,372u Social Security $17,064

Total $29,440

Two problems

u Not enough savings

u Not enough return

Current rates on traditional fixed rate investmentsu 10-year Treasury Bond 1.47%u iShares iBox Investment Grade Corporate Bond ETF 3.32%u 2-year CD 2.70%u AAA rated 20-year municipal bond 1.65%u Money market account 1.22%u S&P 500 dividend yield 1.88%

The power of dividend growth

u Altria (MO) - Current dividend yield: 7.6%; five-year dividend growth rate: 9.7%

u Income on $20,000 investment

YieldCurrent $1,520 7.6%5 Years $2,415 12.07%10 Years $3,836 19.18%15 Years $6,095 30.47%

The power of dividend growth

u Brookfield Infrastructure Partners (BIP) – Current yield: 4.16%; five-year dividend growth: 10.4%

u Income on $20,000 investment

YieldCurrent $832 4.16%5 Years $1,364 6.82%10 Years $2,238 11.19%15 Years $3,670 18.35%

Average Annual Returns and Volatility by Dividend Policy (1/31/72–12/31/18)

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Returns Beta Standard Deviation Dividend Growers & Initiators 9.62% 0.88 15.62% Dividend Payers 8.78% 0.94 16.37% No Change in Dividend Policy 6.88% 1.00 17.76% Dividend Non-Payers 2.40% 1.29 24.34% Dividend Cutters & Eliminators -0.79% 1.21 24.68% Equal-Weighted S&P 500 Index 7.30% 1.00 17.26%

Companies that grew or initiated a dividend have experienced higher returns relative to other stocks since 1972—with significantly less volatility.

Data Sources: Ned Davis Research and Hartford Funds, 1/19. Stocks within the S&P 500 Index.

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Let’s Go to the Calculator

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Dividend Reinvestment CalculatorInitial Number of Shares 1,000Initial Price per Share $20Annual Dividend $1.00Dividend Annual Growth Rate 5%Stock Price Annual Growth Rate 5%Number of Years 10

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Calculator Results

Without Dividend Reinvestment With Dividend Reinvestment

Total Value $45,785 $53,066

Number Shares 1,000 1,629

Dividends Paid $13,207 $16,936

Annualized Return 8.63% 10.25%

Ten-Year Returns$20,000 with dividends reinvested

u S&P 500 $62,954u Altria (MO) $97,044u McDonalds (MCD) $100,324u PepsiCo (PEP) $63,688u Visa (V) $231,728u Caterpillar (CAT) $95,054

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Enterprise Product Partners (EPD): Yield 6.1%

Enterprise is one of the largest energy infrastructure companies in the country with a vast portfolio of service assets connected to the heart of American energy production.

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Enterprise Product Partners (EPD)

u Despite rising earnings, the stock is still 30% below the 2014 high.u An estimated $44 billion will need to be spent on new American

energy infrastructure to keep pace with all the oil and gas production amidst the energy boom between now and 2023.

u Enterprise has projects coming on line this year and in future years that should boost earnings.

u The stock has performed well while the energy sector was out of favor and should thrive when that changes.

u The distribution has been raised every quarter for 20 years and stock performance has been outstanding over that timeframe.

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AbbVie Inc. (ABBV): Yield 6.5%

AbbVie is a cutting-edge, U.S.-based biopharmaceutical company specializing in small molecule drugs.

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AbbVie Inc. (ABBV): Yield 6.5%u The stock sells at a ridiculously cheap seven times

forward P/E ratio.u Concern about competition for blockbuster drug

Humira is pricing in a worst-case scenario that is unlikely to transpire.

u AbbVie has one of the best pipelines of future drugs and newly launched drug in the industry.

u The merger with Allergan will increase revenues and diversify away from Humira.

u This is one of the fastest-growing, high dividend-paying stocks in the industry in the midst of a bad stint.

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Cabot Dividend Investor

Chief Analyst Tom Hutchinson uses the proprietary IRIS investing system to help you make smart investing decisions that really grow your wealth. Subscribers receive: u Monthly issues of Cabot Dividend Investor with articles and

updates on the current stocks in 3 income portfolios u Weekly updates with news/alerts on investment

recommendations and general market conditions.u 24/7 online access to your current issue and recommendations,

complete library of back issues and recommendations, portfolio tracking, guidebooks, and more.

u Direct access to Tom Hutchinson for answers to your questions.

Watch your email for a WEBINAR SPECIAL OFFER

Upcoming Eventsu Cabot Wealth Summit 2020

8th annual investor conference with the entire Cabot Wealth Network analyst team August 2020

u [Free Webinar] Make Money with Global Stocks plus 2 Global Stocks to Buy NowCarl Delfeld, Chief Analyst, Cabot Global Stocks Explorer, on Wednesday, October 23 at 2PM ET. Sign up now at CabotWealth.com/webinars

And, don’t forget – Watch your email for a WEBINAR SPECIAL OFFER

Questions?

Thank you for joining us.

Tom HutchinsonChief AnalystCabot Dividend Investortom@cabotwealth.com800-326-8826 toll-free

Cabotwealth.com/webinars

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