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Got $10,000? Buy These 3 Dividend Stocks Yielding More Than 4%

If you have $10,000 you can afford to invest, you should consider buying some high-yielding dividend stocks. They can generate recurring cash flow for you and potentially make up for losses elsewhere in your portfolio. For example, if you invest that amount on a stock paying 4%, you would be collecting $400 in annual dividends.

Three stocks that pay even more than that and which can be pillars for your portfolio include Medical Properties Trust (NYSE: MPW), Village Super Market (NASDAQ: VLGEA), and Enbridge (NYSE: ENB). The lowest-yielding stock on this list pays 4.3% -- that's more than three times the S&P 500 average of 1.4%.

1. Medical Properties

A real estate investment trust (REIT) can make for a solid income stock to buy because it has to pay out 90% of its earnings to investors. Although the healthcare-focused REIT hasn't been performing badly this year, its shares are down 33% in 2022 or nearly double the S&P 500's drop of 18%.

Earlier this year, the REIT closed on a transaction where it sold a 50% interest in eight Massachusetts-based general acute care hospitals. While it's a reduction in assets, it demonstrated Medical Properties' shrewd management: The company banked a 47% gain on the sale of the real estate. And the $1.3 billion in cash it received from the deal will go to shrinking its debt, which totaled $10.1 billion at the end of March.

Bringing down debt and adding cash is a good move for the company and only makes it a safer buy. However, Medical Properties is not all that risky to begin with; its funds from operations (a REIT's version of net income) over the first three months of 2022 totaled $0.47 per share -- more than the company's quarterly dividend of $0.29 per share.

The falling share price has pushed Medical Properties' yield up to an incredible 7.4%. Given its strong fundamentals, this could be an underrated dividend stock to own right now.

2. Village Super Market

Investing in defensive stocks like grocery stores can be a safe move to make today. It's easier for grocery stores to pass on rising costs to consumers than it is for other businesses. That, in turn, can make them safe investments to hold amid inflation.

Unsurprisingly, Village Super Market has been relatively stable this year as its shares are down less than 1%. And if you count its 4.3% dividend yield, then you'd be in positive territory right now if you owned the stock. Village Super Market isn't an exciting stock, but it can make for a sound investment -- it owns ShopRite and Fairway Market locations across multiple states, including New Jersey and New York.

This is a bit of an under-the-radar stock to buy as Village Super Market's shares average a 30-day volume of less than 30,000. However, with a stable business, dividend yield of 4.3%, and payout ratio of around 60%, it can make for a great dividend stock to add to your portfolio.

3. Enbridge

If you're looking for more of a mix between a good return and a high yield, then pipeline company Enbridge should be near the top of your list. It's primarily in the business of moving and transporting oil and gas, so that makes it a safer buy than other stocks in the sector. And its long-term contracts give Enbridge plenty of stability.

However, that doesn't mean it doesn't benefit from surging demand. More activity on its pipelines helps the company generate more revenue. And with the rise in oil prices this year, shares of Enbridge are up 8%. While that's not nearly as high as the 45% gains top oil and gas producer ExxonMobil's stock has amassed thus far, Enbridge will be the safer stock to hold even if oil prices come down -- which they inevitably will as supply increases. The Organization of the Petroleum Exporting Countries has been increasing production this year, and over time, that will help normalize commodity prices.

Enbridge's business is stable, as is its dividend. It has been increasing its payouts for 27 years in a row, and today it yields 6.6%. The company uses distributable cash flow (DCF), which is calculated by making adjustments to operating cash flow, to assess the strength of its dividend. And through the first three months of 2022, the company's DCF totaled 3.1 billion Canadian dollars, or CA$1.52 on a per-share basis. That's well above the CA$0.86 that Enbridge currently pays in dividends each quarter.

This high-yielding stock gives investors a way to gain exposure to the one sector that's doing well these days -- oil and gas -- without taking on excessive risk. And at the same time, you're securing a top dividend along the way.

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*Stock Advisor returns as of June 2, 2022

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Enbridge. The Motley Fool has a disclosure policy.


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