Entering text into the input field will update the search result below

5 Dividend Growers With 8%+ Yields And High Return Potential

Apr. 03, 2021 8:26 AM ETABR, EPD, MPLX, PSX, TSLX28 Comments


  • Dividend growth stocks as a group have crushed the market over time.
  • In the current low-interest rate environment, most dividend growth stocks have low yields.
  • Today we present five stocks that combine meaningful dividend growth streaks with extremely attractive yields and significant total return potential.
  • Looking for a portfolio of ideas like this one? Members of High Yield Investor get exclusive access to our model portfolio. Learn More »

Looking directly up at the skyline of the financial district in central London - stock image
Photo by Nikolay Pandev/E+ via Getty Images

Dividend growth investing is a proven model for generating long-term outperformance.

In fact, dividend growers have historically crushed the broader market (SPY):


Unfortunately, with interest rates (GOVT) near historic lows, dividend-paying stocks

If you want full access to our Portfolio and all our current Top Picks, feel free to join us for a 2-week free trial at High Yield Investor.

We are the fastest growing high yield-seeking investment service on Seeking Alpha with over 600 members on board and a perfect 5/5 rating from 61 reviews:

Our members are profiting from our high-yielding strategies and you can join them today at our lowest rate ever offered.

With the 2-week free trial, you have nothing to lose and everything to gain.

Get Started Today!

This article was written by

Samuel Smith profile picture

Samuel Smith is Vice President of Leonberg Capital, he has a diverse background that includes being lead analyst at several highly regarded dividend stock research firms. He is a Professional Engineer and Project Management Professional and holds a B.S. in Civil Engineering & Mathematics from the United States Military Academy at West Point and has a Masters in Engineering.

Samuel leads the investing group High Yield Investor investing group. Samuel teams up with Jussi Askola and Paul R. Drake where they focus on finding the right balance between safety, growth, yield, and value. High Yield Investor offers real-money core, retirement, and international portfolios. The services also features regular trade alert, educational content, and an active chat room of like minded investors. Learn more.

Analyst’s Disclosure: I am/we are long EPD. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (28)

So TSLX and ABR do no issue K-1's. correct?
That’s an interesting list and provides some good food for thought. EPD is one of my largest positions and I don’t think I’ll ever sell it; I just keep adding more. Thanks!
Samuel Smith profile picture
@PermaFrostByte thanks for reading and sharing!
Wow, did not know PSXP was yielding 10%+ shows how well I've been keeping track of MLPs. I used to own quite a few (including PSXP near its inception) but ended up selling them all as I got tired of the annual tax filing. I do remember PSXP made me a tidy bit of profit, good thing I sold I guess given its price movement the past year. Same with the Shell midstream drop down.
Samuel Smith profile picture
@clrodrick thanks for reading and sharing!
Refreshing to see that two of my largest holdings: TSLX, ABR (as well as its Prefs.) are mentioned. :)
Samuel Smith profile picture
@Unojack thanks for reading and sharing!
Thank you for nice and simple article! I'm long in MPLX and bought it when the dividend ratio was 12%! That seemed very impressive and one of the biggest dividend yields in the market, though Shell Midstream and Antero Midstream offer even higher yields, therefore I was a bit surprised not to see them here.
Samuel Smith profile picture
@Osvaldas31 note that this article discusses dividend growers, not just high yields.
I would have included MMP instead of PSXP(which is a dice roll on DAPL). MMP offers a 10% yield with top rate management & as strong a balance sheet as EPD. Coverage is currently lean at 1.1x, as a result of an outsized covid hit to volumes. But looking forward, it's predominantly gasoline and jet fuel pipelines should present an outsized recovery play as the economy re-opens, and coverage should return to management's 1.25x longtime standard. This is a management team that, besides maintaining financial health and a strong balance sheet, has consistently been the most profitable of all MLP's on it's investments. This is top quality. Adjusted risk/reward, seems to me a better bet than PSXP- unless you have a gambler's streak looking for a favorable DAPL outcome.
Samuel Smith profile picture
@Nathan5 we like MMP much more than PSXP. However, they have already announced their intention to freeze their distribution this year, so that disqualifies them from being an income growth stock.
@Samuel Smith But PSXP has not only frozen theirs, if DAPL rolls thr wrong way- a cut is in the cards.
Samuel Smith profile picture
@Nathan5 yes we mentioned this in the article. Note that this is far from a top 5 list. We are long only one of these stocks.
Re: high yield, I own some, but no MLPs. I can't hold them in an IRA, and I've shied away from them in my individual holdings. I do own ARB, which has been a winner because I bought it just over $9.00 a share. I do note that it is still down significantly from the 2008 recession. I'm not familiar with the BDC, but I will check it out. Thanks you!
@Sam_12 If interested, you could hold the AMLP MLP ETF in an IRA account, although the current price is a little high.
Samuel Smith profile picture
@Sam_12 glad you found it useful!
Samuel Smith profile picture
@Off-The-Run very true. MLPA is preferable in my view because its management fee is much lower than AMLP's.
rickevantodd profile picture
Very good article. Very long EPD and short June 21 puts. For diversification in the space I am long both MLPA and MLPX.
Samuel Smith profile picture
@rickevantodd good picks! Thanks for sharing.
TSLX if of interest at the right price. Arbor is also, but I can't get past the 91% Bridge Loans with WA maturity of 18.9 years. These two stats don't go together; Bridge loans are, at least in my mind, short term in nature. Such loans are taken out to "Bridge" a period of time, usually financing a renovation project or some temporary condition. So how do they get to 18.9 years? Doesn't make sense to me at all.
Samuel Smith profile picture
@Arimnestos it is 18.9 months, not years. You are correct that bridge loans of 18.9 years would not make sense, especially for the borrowers, since apartment cap rates are typically far below bridge loan interest rates.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.