The S&P 500‘s dividend yield is around 1.2% these days, which is near its all-time low. However, that doesn’t mean there aren’t attractive income opportunities today. Several high-quality companies currently offer dividend yields that are much higher.
Here are three safe dividend stocks with yields of at least 3% that you can confidently buy right now.
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Brookfield Infrastructure‘s (NYSE: BIPC)(NYSE: BIP) dividend yield is around 3.8% these days. The global infrastructure operator has a diverse portfolio of critical infrastructure businesses across the utilities, transportation, energy midstream, and data sectors. Most of those businesses generate durable cash flows backed by long-term contracts or government-regulated rate structures (85% of its funds from operations) that either index rates to inflation or protect its earnings from its impact. As a result, Brookfield generates steadily rising cash flow to support its dividend.
The company aims to pay out 60% to 70% of its stable cash flows in dividends, retaining the remainder to reinvest in expanding its operations. Brookfield currently has about $7.8 billion in capital projects in its backlog, which it expects to complete over the next two to three years. The bulk is in its data segment (nearly $6 billion) and includes its investments in a U.S. semiconductor foundry and multiple global data center projects.
Brookfield Infrastructure also acquires new businesses. It has secured $1.5 billion of deals over the past year, including investments in a U.S. refined products pipeline system, a bulk fiber network, and an advanced fuel cell system to power data centers. The company’s growth catalysts support its expectations of growing its funds from operations by more than 10% annually, which should drive dividend increases of 5% to 9% each year. Brookfield has grown its payout at a 9% compound annual rate since 2009.
ExxonMobil(NYSE: XOM) has a dividend yield of just over 3%. The global oil and gas giant supports its dividend with a large-scale, globally integrated business. That helps mute some of the impact of oil price volatility on its earnings. Exxon also has a fortress balance sheet.
The oil and gas giant is already the most profitable company in the industry. It expects to make even more money in the future. Exxon anticipates delivering $25 billion in earnings growth and $35 billion in cash flow growth, compared to 2024’s levels, on a constant-price, constant-margin basis by 2030. It aims to deliver that incremental profitability through a combination of structural cost savings and high-return growth capital projects.
Exxon’s plan would enable it to generate about $145 billion in cumulative surplus cash over the next five years at an average oil price of around $65 per barrel. That would give the oil company plenty of fuel to continue increasing its dividend, which it has done for a sector-leading 42 consecutive years.
Prologis(NYSE: PLD) has a 3.2% dividend yield. The real estate investment trust (REIT) backs its dividend with the stable cash flows produced by the long-term leases securing its properties. Most of its leases contain annual rental escalation clauses, enabling it to earn steadily rising rental income.
The REIT has a conservative dividend payout ratio and one of the sector’s strongest balance sheets. That gives it the financial flexibility to expand its portfolio. It invests in development projects and makes acquisitions.
Prologis primarily invests in logistics properties. However, it sees a significant opportunity to leverage its vast land bank, its experience installing solar panels and battery storage at its sites, and its expertise in constructing building shells to develop data centers. These growth drivers should enable Prologis to continue increasing its dividend. It has grown its payout at a 13% compound annual rate over the last five years, well above the S&P 500’s 5% average.
Brookfield Infrastructure, ExxonMobil, and Prologis all pay dividends yielding more than 3% backed by strong businesses and financial profiles. They also have excellent dividend growth track records, which should continue. Those features make them safe dividend stocks you shouldn’t hesitate to buy right now.
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Matt DiLallo has positions in Brookfield Infrastructure, Brookfield Infrastructure Partners, and Prologis. The Motley Fool has positions in and recommends Prologis. The Motley Fool recommends Brookfield Infrastructure Partners. The Motley Fool has a disclosure policy.
