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I’m looking to boost my passive income stream this year by finding dividend stocks to buy. There are some high yielding stocks that I would buy for my portfolio today if I had the money to invest. Here are three of them.
M&G
Fund manager M&G (LSE: MNG) has been a bit of a disappointment for shareholders, including myself, last year, down 8% over the past 12 months. But more positively, the company aims to maintain or increase its dividend. Now the yield is 9.6% juice.
One of the reasons stocks fell last year was investor nervousness about the asset management sector. A worsening economic environment can reduce asset values, increasing investor withdrawal. That can lead to profit and loss.
However, I consider the stock to provide good value for my portfolio. M&G is an established brand, demand for financial services will remain strong over the long term and the business has proven to be consistently profitable, although last year’s earnings were down significantly compared to the previous 12 months. That concerns me, but with a long-term investment mindset I see M&G’s current share price as a buying opportunity for my portfolio.
Direct Line
I will buy it too Direct Line (LSE: DLG) for my portfolio if I have spare funds to invest.
The insurer is a household name. It also benefits from resilient demand as most people will insure their homes and motor vehicles whatever happens in the wider economy. By staying in the mainstream line of insurance, the company can avoid the huge losses that competitors who offer catastrophe insurance and the like can do.
The company yields 9.8%, which means that if I put £1,000 into the shares today it will hopefully generate almost £100 in annual passive income. One risk I see is a decrease in profits if the company loses customers, as happened in the first half. Hopefully, in the long term, Direct Line’s strong brand and deep commercial experience will enable it to remain profitable.
Income and Growth
Other than high yield shares I would add to my portfolio if I had cash to spare Income and Growth Ventures Capital Trust (LSE: IGV).
The 10.4% yield is certainly attractive to me, although the dividend tends to be advanced based on the performance of the trust’s investments. Put money into many different companies at the beginning of development and try to benefit from success.
The strategy includes the risk that the trust will lose money on some investments. Hopefully, we can get a good chance, as we have done in the past. That can help the company pay dividends to its shareholders.
While I also hope for opportunities for capital growth, in the last year the share price has actually fallen by 16%. Income is the main attraction for me here and falling share prices have led to higher yields.
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