Dividend Powerhouses: 3 Stocks to Hold for Lasting Wealth

Dividends offer investors a powerful strategy for building long-term wealth, especially when those dividends are reinvested. The following three stocks not only boast dividend yields exceeding 5%, but they also possess unique attributes that make them worthy of a permanent place in your portfolio.

Unlock the Renewable Energy Boom with This Dividend Gem

Renewable Energy's Unstoppable Rise

The global renewable energy sector is experiencing a remarkable surge, with annual capacity additions jumping by nearly 50% in 2023 – the fastest growth rate in two decades. This trend shows no signs of slowing, as renewable energy continues to set new records year after year. Investors would be wise to position themselves to capitalize on this transformative shift.

Clearway Energy: A Dividend-Paying Renewable Powerhouse

Clearway Energy (NYSE: CWEN) is poised to thrive in this renewable energy boom. As one of the largest owners of clean energy generation assets in the U.S., Clearway's fleet comprises approximately 9,000 MW of net owned capacity across 26 states. This diverse portfolio includes wind, solar, energy storage, and environmentally responsible natural gas facilities.The company's strategic positioning is further bolstered by the Federal Reserve's recent rate cut, which enables Clearway to more affordably fund its acquisition pipeline. With multiple renewable energy projects in the works, Clearway's growth trajectory appears firmly intact. Notably, the company offers exceptional transparency around its dividend, which currently boasts a yield of 5.5% and a targeted 5% to 8% annual growth rate through 2026, with a payout ratio between 80% to 85%.As the renewable energy revolution continues to unfold, Clearway Energy stands out as a dividend-paying stock that investors can confidently hold for the long term, reinvesting its robust dividends to compound their returns.

Verizon: A 5G Powerhouse with a Juicy Dividend

Verizon's Strategic Acquisition and 5G Dominance

Verizon Communications (NYSE: VZ) is the largest telecommunications company in the United States by revenue, with a business model primarily focused on internet and phone subscriptions, as well as equipment sales. However, the company's recent strategic move has added an exciting new dimension to its operations.In September, Verizon announced a $20 billion all-cash acquisition of Frontier, one of the largest pure-play fiber internet providers. This acquisition will significantly expand Verizon's fiber footprint, increase its scale with 2.2 million fiber subscribers, and generate at least $500 million in annual cost synergies.But Verizon's true long-term appeal lies in its leadership in 5G technology. The barriers to entry in this industry are exceptionally high, making it likely that Verizon will remain one of only three companies with a nationwide 5G network. This dominant position in the 5G landscape is a key reason why investors can confidently hold Verizon forever.

A Dividend Aristocrat with a Juicy Yield

Verizon's commitment to rewarding shareholders is evident in its dividend history. The company has increased its dividend for 18 consecutive years, a testament to its financial strength and stability. Currently, Verizon's dividend yield sits at a generous 6%, providing investors with a steady stream of income to complement the company's growth potential.With its strategic acquisition, industry-leading 5G network, and reliable dividend, Verizon is a stock that can be held indefinitely, offering investors a compelling combination of growth, income, and long-term value.

Ford: Navigating the EV Transition with Dividend Resilience

Ford's EV Challenges and Cost-Cutting Measures

Ford Motor Company (NYSE: F) presents a unique opportunity for investors, as the iconic automaker navigates the challenges of the electric vehicle (EV) transition. While Ford's traditional divisions, such as Ford Blue and Ford Pro, are generating healthy profits, the company's Model e unit, responsible for electric vehicles, has been a source of significant losses.In fact, Ford's Model e division is projected to lose up to $5.5 billion in 2024 alone. However, the company is not sitting idly by, and it has taken decisive action to address these headwinds. Ford has delayed as much as $12 billion in EV investment, reducing the capital expenditure allocated to EVs from 40% to 30%. The company has also canceled a line of EV SUVs, minimized plans for a battery factory, and launched a "skunkworks" team to develop a low-cost EV platform targeting prices around $25,000.

Dividend Resilience Amid Industry Challenges

The automotive industry's transition to electric vehicles has been slower than anticipated, and Ford's EV losses may continue to weigh on the company's performance in the short term. However, investors should take a long-term view on Ford, as the company works through these challenges and eventually reverses its EV losses.Despite the industry's cyclical nature and the ongoing EV revolution, Ford remains a compelling dividend stock. At current prices, the company's dividend yield stands at a robust 5.7%, and it has a history of offering supplemental dividends when it has extra cash. As Ford navigates the EV transition and brings down the costs of its electric vehicles, the company's ability to increase dividends in the future is likely to be a significant draw for income-oriented investors.By holding Ford for the long term, investors can benefit from the company's resilience, its efforts to optimize its EV strategy, and the potential for increased dividend payouts as it overcomes the current headwinds.