These High-Yield Dividend Stocks Are Stomping on the Gas and Revving Up Their Growth Engines
Higher-yielding dividend stocks tend to be slower-growing companies. They often pay out a significant percentage of their cash flow in dividends because they don't have enough attractive growth opportunities to reinvest that cash. Their slower growth also weighs on their valuations, which causes their dividend yields to rise.Pipeline companies have fit that description in recent years as their growth has slowed. However, the industry is seeing a resurgence in demand. Because of that, several pipeline stocks are stomping on the gas by ramping up their investment rates, which should fuel faster growth in the coming years. And that re-acceleration could enable them to grow their high-yielding dividends even faster in the future. Natural gas pipeline giant Kinder Morgan (NYSE: KMI) has been running on fumes in recent years. The company's growth engine had stalled out, causing its dividend yield to rise. At recent prices, it yielded about 4.2%, which was several times higher than the S&P 500's 1.3% yield.Continue reading
Higher-yielding dividend stocks tend to be slower-growing companies. They often pay out a significant percentage of their cash flow in dividends because they don't have enough attractive growth opportunities to reinvest that cash. Their slower growth also weighs on their valuations, which causes their dividend yields to rise.
Pipeline companies have fit that description in recent years as their growth has slowed. However, the industry is seeing a resurgence in demand. Because of that, several pipeline stocks are stomping on the gas by ramping up their investment rates, which should fuel faster growth in the coming years. And that re-acceleration could enable them to grow their high-yielding dividends even faster in the future.
Natural gas pipeline giant Kinder Morgan (NYSE: KMI) has been running on fumes in recent years. The company's growth engine had stalled out, causing its dividend yield to rise. At recent prices, it yielded about 4.2%, which was several times higher than the S&P 500's 1.3% yield.
