Imagine a machine that generated cash for you year in and year out. Unfortunately, such a machine doesn’t exist. However, the closest alternative is investing in assets that generate reliable passive income.
Some assets are better than others, though. Do you want decades of passive income? Here are three stocks to buy now and hold forever.
Perhaps the most important thing for investors seeking passive income to know about AbbVie, though, is that it’s a Dividend King. This elite group consists of stocks that have increased their dividends for at least 50 consecutive years. AbbVie’s streak of dividend hikes currently stands at 54 years.
The company’s forward dividend yield stands at 3.1%. AbbVie’s yield has been even higher in the past, but its soaring share price has caused the yield to decline somewhat. That’s not a bad problem to have.
I view AbbVie as one of the most stable pharma stocks around. The company successfully navigated a patent cliff after its longtime top-selling drug, Humira, lost exclusivity. Thanks to investments in developing new products and making shrewd acquisitions, AbbVie barely skipped a beat before returning to growth.
Practically everyone is at least somewhat familiar with The Coca-Cola Company(NYSE: KO). The company’s soft drinks and other beverages are sold in more than 200 countries and include 30 billion-dollar brands.
Like AbbVie, Coca-Cola is a Dividend King. However, its dividend track record is even more impressive. The company has increased its dividend for a remarkable 63 consecutive years. I expect we’ll see that number rise in early 2026. Coca-Cola’s dividend yields an attractive 2.9%.
Most lists of safe haven stocks will prominently feature Coca-Cola. That’s not surprising, considering the company has survived and thrived for 139 years. If the economy declines, Coca-Cola will likely hold up better than most.
However, this longtime favorite of investors still has plenty of growth opportunities ahead. Despite its tremendous success, Coca-Cola has a market share of only 14% in developed markets and 7% in developing and emerging markets, encompassing cold beverages, hot beverages, and ready-to-drink alcoholic beverages.
I have saved the stock that’s arguably the best choice for passive income investors for last. It’s Realty Income(NYSE: O). This real estate investment trust (REIT) owns 15,542 properties in nine countries. Realty Income ranks as the world’s sixth-largest REIT based on market cap.
Granted, Realty Income isn’t a Dividend King like AbbVie and Coca-Cola. However, the company has increased its dividend for 30 consecutive years and, even more impressively, for 112 consecutive quarters. Realty Income has grown its dividend by a compound annual growth rate of 4.2% since listing its shares on the New York Stock Exchange in 1994.
The REIT’s forward dividend yield is 5.7%. Even better, Realty Income pays its dividend on a monthly basis. It even registered the phrase “The Monthly Dividend Company” as a trademark.
Like AbbVie and Coca-Cola, Realty Income offers stability. Its portfolio is highly diversified, with 1,647 tenants representing 92 industries. The stock’s beta is 0.5, indicating significantly lower volatility compared to the S&P 500(SNPINDEX: ^GSPC). Realty Income has also delivered 29 straight years of positive total operational returns (annual adjusted funds from operations per share plus dividend yield).
There’s even more good news about this stock, though. Realty Income has tremendous growth opportunities. The company estimates its total addressable market is roughly $14 trillion. Around $8.5 trillion of this market is in Europe, where Realty Income faces limited competition.
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Keith Speights has positions in AbbVie and Realty Income. The Motley Fool has positions in and recommends AbbVie and Realty Income. The Motley Fool has a disclosure policy.
