3 stocks to buy with dividends yielding more than 3%

Is a 3% dividend yield target unambitious, when there is something bigger? Yes, I am looking for relatively safe income stocks to buy for the long term. And some of my favorites look really cheap.

Safety ditch

National Grid (LSE: NG.) has a forecast 5% yield. Shares have dropped 10% over 12 months, and I smell a buying opportunity.

Some investors are understandably nervous about the long-term future for gas distribution. And I see that is probably the main risk.

But gas will be replaced by electricity, right? It will not stop, it will only increase to a renewable source. And the National Grid has also been sewn up.

If we look back at the dividend history here, we see a record of progressive annual increases over the years.

And that’s a big attraction for me. Yes, there will be risks ahead. But the best long-term dividend stocks are often those with strong defensive moats. I saw one of those on National Grid.

Essentials

Before checking the bigger results, this is one of the safest stocks. I’m talking about Unilever (LSE: ULVR), with an estimated 3.6%.

It is not one of the biggest crops. But it is in the area FTSE 100long-term average. And I rate Unilever’s dividend as one of the most reliable.

Stocks gain during the pandemic. An increase in sales of cleaning and hygiene products will not hurt. But the price is starting to fall from the 2020 peak.

I see another buying opportunity, especially with dividends also covered by earnings.

We are going through tough economic times right now. And that would mean less clarity on earnings. So we could see some stock price volatility as a result. But Unilever is on the long-term buy list.

addictive

Imperial brand (LSE: IMB) is the biggest, with a forecast dividend of 7%. It comes after a year of weak stock prices. Some may choose not to buy for ethical reasons, but I’m just looking at the investment angle here.

The stock has recovered somewhat over the past 12 months. But the stock is still underrated by the market. Any further gains will dilute the large dividend yield, so now could be a good time to buy.

In a few years, the possibility of poorness comes down to the feeling that cigarettes are on the way out as a product. I may be wrong, and the industry may be on the way out.

But I just don’t see it. Many in the world still buy cigarettes in the billions, with premium brands still a lot. And the move to newer tobacco-based products is getting stronger.

Analysts see substantial earnings growth in the coming years. I saw a cash cow.

Verdict

These all face individual risks, which should be assessed by the investor himself. But these three can make a good start for a long-term dividend portfolio. And I rate everything as cheap now.