Key Points

• Tesla helped to create the EV market, upending business as usual for the auto sector.

• Lucid is attempting to follow Tesla's lead, using EVs as a wedge to break into the auto industry.

• Lucid has a long way to go before it is anywhere near the company Tesla is today.

• These 10 stocks could mint the next wave of millionaires ›

Tesla (NASDAQ: TSLA) and its high-profile CEO Elon Musk can be polarizing. However, the automaker has achieved things that seemed impossible. It not only broke into the highly mature auto industry, it also helped to create the electric vehicle (EV) market. Could buying EV upstart Lucid (NASDAQ: LCID) set investors up for a similar success story?

Tesla: There are good things and bad here

Tesla was once a tiny upstart, attempting to build a business around a technology that was well understood but that hadn't gained any traction with consumers. To make matters worse, to achieve success, it had to compete against mature and well-entrenched auto industry giants.

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To the company's credit, it pulled it off and, along the way, basically created the electric vehicle market. Now every major automaker is offering EVs and there are numerous upstarts in the U.S. and abroad trying to ride on Musk's and Tesla's coattails. The end goal for all is to build a sustainably profitable EV business, which is where Tesla sits today.

That said, Tesla has exposure to other businesses. Selling cars is the big story, but the business also has a battery storage division, and it's working on autonomous driving technology and robots. There's a lot going on "under the hood." That's part of why Tesla's valuation seems stretched, with a price-to-earnings ratio of 182x. Investors are pricing a lot of good news into the stock. Investors who care about valuation probably won't be interested.

Lucid is trying to break into the auto industry, too

If you missed out on the huge price gains that investors in Tesla have achieved, there are other EV makers that are in an earlier stage of development. One is Lucid, which only sold around 3,100 cars in the first quarter of 2025. That's a rounding error for Tesla and the major automakers. However, that number was up around 50% year over year. Essentially, Lucid is making progress as it looks to grow.

Moreover, Lucid's high-end cars have been well received, earning industry accolades. So this isn't a fly-by-night business that's clinging to life, even though the stock has fallen more than 90% from its highs. At those highs, Wall Street was clearly overly enamored with EV upstarts. Now investors could be overly pessimistic, ignoring the incremental successes that Lucid is steadily achieving.

That said, not all investors have turned away from Lucid. In Q1, it was able to extend the maturity on a convertible note from 2026 to 2030. That's a big statement of confidence, and it gives the upstart EV maker more leeway to keep expanding and improving its business. It improved its gross margin in Q1 as it increased its volumes. To be fair, it is just losing less on every car that it sells than it did a year ago. But that's the path that a new manufacturing business has to go down, given the large up-front costs involved in starting from scratch.

Both stocks are high-risk, but Lucid's future is better defined

Lucid is still losing money and will likely continue to do so for years to come. So valuation metrics aren't meaningful for the upstart. However, the road it needs to traverse has been laid down by Tesla, so it is pretty clear what steps Lucid needs to take from here. There are very big risks involved, and risk-averse investors shouldn't buy it. But if you're looking at Tesla, you might want to consider Lucid instead.

Tesla makes great cars, but the business is clearly more mature than Lucid's. The other businesses hidden within Tesla present an opportunity, but they could flame out, too. So the huge valuation being afforded Tesla may not be worth the risk. Add in the CEO's volatile public image, and uncertainty increases materially.

Overall, if you were thinking about taking a risk on Tesla, it might be better to take a risk on Lucid. It has, for the most part, successfully achieved the key goals it has laid out as it looks to become the next Tesla.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $414,949!*
• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $39,868!*
• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $687,764!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.

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*Stock Advisor returns as of July 7, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.

Key Points

• The energy sector is volatile, but some companies are built to survive that volatility.

• Chevron has a lofty yield and a long history of returning value to investors via dividend hikes.

• TotalEnergies has a lofty yield and a business that is changing with the world around it.

• 10 stocks we like better than Chevron ›

Chevron (NYSE: CVX) is offering investors a 4.7% dividend yield today. TotalEnergies' (NYSE: TTE) yield is even higher at 6.3%. That compares to an energy industry average of just 3.5%. But lofty yields are just one reason to like Chevron and TotalEnergies. Here are a few more that may prompt you to buy one or both of these energy industry giants right now.

Chevron and TotalEnergies are integrated

The one thing every investor needs to understand about the energy sector right up front is that it is inherently volatile. Oil and natural gas are commodities, and their prices swing widely and quickly. That's why I prefer to invest in the energy sector via integrated energy stocks. Most conservative investors, and likely most income investors, should probably follow my lead.

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Chevron and TotalEnergies basically have exposure to the entire value chain, from production to transportation, chemicals, and refining. Each segment of the industry operates a little differently, with the diversification across the sector helping to soften the fluctuations in energy prices. To be fair, commodity prices are still the driving force behind Chevron's and TotalEnergies' businesses and stock prices. But integrated energy companies tend to weather the swings better than pure-play drillers and chemical and refining companies.

Chevron has a great dividend record and a solid foundation

That said, Chevron and TotalEnergies are not interchangeable. For example, Chevron has increased its dividend annually for 38 consecutive years. TotalEnergies hasn't managed anything near that level of dividend consistency (more on TotalEnergies' dividend below). Part of the reason for Chevron's dividend success is its focus on operating with a strong balance sheet.

At the end of the first quarter of 2025, Chevron's debt-to-equity ratio was roughly 0.2 times. That's low for any company and is second-best among its closest peers. That gives management the leeway to take on debt during industry weak patches so it can continue to support its business and pay its dividend. When oil prices recover, as they always have historically, leverage is reduced in preparation for the next downturn.

For more conservative dividend investors, Chevron is a solid choice in the energy sector. There will be ups and downs, but the dividend is highly reliable.

TotalEnergies is focused on change

That said, I own TotalEnergies. There are a couple of caveats here, though. First, U.S. investors must pay French taxes on the dividends collected, which reduces the actual income stream they'll receive. Second, TotalEnergies has a history of investing more aggressively. That includes investments in politically volatile countries and, right now, in the development of clean energy. Chevron has largely stuck to its energy core.

The clean energy investments being made are why I've chosen to own TotalEnergies. Essentially, the French energy giant is using its carbon fuel profits to invest in the energy transition that is shifting the world more and more toward electricity. This is going to be a decades-long shift, and an all-of-the-above approach is likely to be the final solution on the energy front. However, I like that TotalEnergies is working on an all-of-the-above strategy right now.

What really sets TotalEnergies apart, however, is that it has made this transition without cutting its dividend (it has actually been increasing it annually of late). European peers BP and Shell announced similar plans and used the business shift to justify dividend cuts. Then, they both walked back their clean energy plans. TotalEnergies has, if anything, sped up its investments in the space.

In other words, TotalEnergies is executing well in a changing world, which is exactly why I want to own it for the long term.

Energy prices have been weak

The interesting thing about both Chevron and TotalEnergies is that oil prices have been relatively weak of late. And that has put downward pressure on each company's shares, lifting their yields to fairly attractive levels. For more conservative dividend investors, Chevron is probably the better choice. But for investors like me who are willing to take on a little more risk to gain exposure to clean energy, TotalEnergies could be a good call right now, too.

Should you invest $1,000 in Chevron right now?

Before you buy stock in Chevron, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Chevron wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $687,764!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $980,723!*

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*Stock Advisor returns as of July 7, 2025

Reuben Gregg Brewer has positions in TotalEnergies. The Motley Fool has positions in and recommends Chevron. The Motley Fool recommends BP. The Motley Fool has a disclosure policy.

Key Points

• Warren Buffett tends to buy well-run companies and hold them for the long term.

• Even well-run companies fall out of favor on Wall Street.

• With a 4.7% yield, this high-yield stock is built to survive whatever comes its way.

Warren Buffett has built an incredible track record running Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B). And he did it using simple-to-understand logic: Buy well-run companies when they look attractively priced and then hold for the long term (so you can benefit from the growth of the business over time). But even well-run companies fall out of favor, and that's why this Buffett stock, with a lofty 4.7% dividend yield, is worth buying in July.

Two oil picks with different industry approaches

Energy stocks are currently suffering through a period of volatility thanks to geopolitical tensions. That's not unusual at all. The energy market is known for being volatile, and so are most stocks in the energy sector. Buffett has two energy investments, Occidental Petroleum (NYSE: OXY) and Chevron (NYSE: CVX). They have materially different industry positions.

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Oxy, as it is more commonly known, is focused on growing its business as quickly as practicable so it can better compete with established industry giants like, well, Chevron. Chevron, an industry giant, is focused on slow growth and -- here's the key for investors -- surviving through the inherent ups and downs of the energy sector. The second bit is why Chevron is so attractive as July gets underway.

There are three parts to Chevron's story. The one that will likely be most interesting to investors is its reliable dividend. The integrated energy giant has increased its dividend year in and year out for 38 consecutive years. That's an incredible streak given the price swings that have occurred in oil over that span. The company is, clearly, focused on rewarding investors for sticking around.

The interesting part is that this reliable dividend stock's dividend yield gets attractive during the tough times. Right now is a tough time thanks to both industry issues and some company-specific problems. History suggests Chevron will muddle through and continue to pay its dividend. In the meantime, investors can collect a hefty 4.7% dividend yield.

What backs Chevron's lofty yield?

A big yield that gets reliably paid is nice, but it doesn't fully explain why Buffett has Chevron in Berkshire Hathaway's portfolio. Which is where the next two parts of the Chevron story come in.

First, Chevron is an integrated energy giant. That means that it has exposure to the entire energy value chain, from producing oil and natural gas, to transporting the commodities, to processing them into other products. Each segment works a little differently through the energy cycle. Having exposure to all of them helps to smooth out performance over time. On top of that diversification, Chevron also has a global portfolio. So it can shift its investments to where they will have the best opportunity for success.

CVX Debt to Equity Ratio data by YCharts

That's a solid start, but there's another important factor. Chevron also has one of the strongest balance sheets in the energy patch, with a debt-to-equity ratio of just 0.2 times. That gives management the leeway to add debt during industry downturns so it can continue to support the business and dividend through hard times. When commodity prices recover, as they always have historically, it pays down its debt in preparation for the next downturn.

Buy Chevron when others are selling the stock

Chevron's stock is down around 20% from its 2022 highs, when oil prices were much higher. Long-term dividend investors shouldn't get too hung up on the downturn or the reasons why. Chevron is built to survive whatever comes its way. It probably makes more sense to just follow Buffett's "simple" approach and buy this well-run company while it is attractively priced and then hold it for the long term.

Should you invest $1,000 in Chevron right now?

Before you buy stock in Chevron, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Chevron wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

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See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Reuben Gregg Brewer has positions in TotalEnergies. The Motley Fool has positions in and recommends Berkshire Hathaway and Chevron. The Motley Fool recommends BP and Occidental Petroleum. The Motley Fool has a disclosure policy.

Key Points

• Berkshire Hathaway is one of the best-known companies on Wall Street.

• The sprawling conglomerate has long been led by investment icon Warren Buffett.

• It's about to undergo an important change, and it won't be a good fit for every investor.

If you spend any time around Wall Street, from just reading market news to actually working in finance, you know the names Warren Buffett and Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B), which is the company he runs.

Despite the stock's incredible track record, however, there are reasons it may not be the smartest investment you can make. But there are also reasons it could be a great choice. Here's what you need to know.

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Why you should avoid Berkshire Hathaway

The first big reason that an investor might not want to buy Berkshire Hathaway is that it doesn't pay a dividend. And it doesn't appear likely that it will anytime soon. So, if your goal is to generate income from your portfolio to pay for living expenses in retirement, you will not want to buy Berkshire Hathaway stock.

The second reason to avoid Berkshire Hathaway is its complexity. The large insurance operations within the company's portfolio of businesses typically lead it to fall into the finance sector. But the truth is, it is a widely diversified conglomerate. It owns over 180 companies outright and has a portfolio of publicly traded stocks, too. It has exposure to industries as varied as retail, railroads, and manufacturing and a whole lot more in between. If you like to keep your investments simple, this will not be the best option for you.

In that vein, Berkshire Hathaway is kind of like a mutual fund, given that you are, effectively, allowing Warren Buffett and his team to invest on your behalf. To be fair, the company's stock has vastly outperformed the S&P 500 index over time. So, trusting Buffett has worked out very well for investors. But if you like to directly handle all your investment decisions, owning Berkshire Hathaway probably won't be a great call.

BRK.A data by YCharts.

Letting the Oracle of Omaha do it for you

That said, as the chart above highlights, owning Berkshire Hathaway stock has been a big win for investors over time. So, trusting Warren Buffett and his long-term investment approach has worked out well. From a simplistic level, all he's doing is buying well-run companies when they appear attractively valued and then holding for the long term to benefit from the companies' growth over time. Only, if it were really that simple, every investor would have an incredible performance record. And that's just not the case.

Investors who are willing to let an expert handle their hard-earned savings could do much worse than buying Berkshire Hathaway. That said, while the S&P 500 index has been heading higher lately, Berkshire Hathaway stock has been falling. At least part of the reason is that Buffett has announced his intention to step down as CEO. Long-term employee Greg Abel is replacing him at the end of 2025.

This change must be carefully thought through because a new CEO can lead to significant shifts in the way a business is operated. But that's unlikely to happen at Berkshire Hathaway. First off, Buffett is stepping down as CEO, but he will remain chairman of the board, which means he will remain Greg Abel's boss. It is unlikely that Buffett will allow Abel to fail miserably without stepping in to help.

And then there's the not-so-subtle fact that Abel was, effectively, trained by Buffett. Just like Buffett was trained by famed value investor Benjamin Graham. Charlie Munger, Buffett's former partner, provided some educational input, too. Abel has a very impressive educational background as an investor. While he will most certainly do things differently, it seems likely that he won't abandon Buffett's basic approach to chart an entirely new course.

Berkshire is a smart pick for the right investor

Berkshire Hathaway won't be the smartest investment choice for all investors, despite its strong historical stock performance. But if you don't mind entrusting someone else to handle your savings and believe that Abel will carry on the Buffett approach, it could still be a very attractive investment choice for your portfolio.

The one remaining caveat is that Berkshire Hathaway is so large today that future growth may be less impressive than past growth. But with over $345 billion in cash on the balance sheet, a bear market could present a huge investment opportunity that gives Abel the option to boost growth beyond what seems probable with the market trading near all-time highs today.

Should you invest $1,000 in Berkshire Hathaway right now?

Before you buy stock in Berkshire Hathaway, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Berkshire Hathaway wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.

Key Points

• Dividends can help investors identify attractive investment candidates in more ways than one.

• Prologis is a giant, growing industrial REIT with an attractive 3.8% yield.

• Agree Realty is a fast-growing net lease REIT with a 4.2% yield.

There are different ways to use dividends when it comes to selecting investments. Often, dividend investors focus all their attention on the highest-yielding stocks. But you can also buy stocks with a history of attractive dividend growth. And right now, you can purchase these two dividend growers with well-above-market yields of as much as 4.2%. Here's what you need to know.

1. Prologis is a giant industrial REIT that's still growing quickly

With a nearly $100 billion market cap, Prologis (NYSE: PLD) is one of the largest real estate investment trusts (REITs) you can buy. It is also quite easily the largest REIT focused on industrial properties. It owns a global portfolio of assets, so it is also fairly well diversified, geographically speaking.

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The one thing Prologis focuses on is owning warehouses in the most important transportation hubs. That's a problem right now due to concerns about tariffs. However, given the interconnectedness of global trade, it seems likely that the world will adjust to any tariff changes. And assuming that is the outcome, Prologis will again be viewed as a well-positioned REIT.

But not even the tariff upheaval has really changed Prologis' trajectory. In the first quarter of 2025, it increased rents on renewing leases by a huge 32% on a cash basis. The average annualized dividend growth rate during the past decade was an attractive 11%, and the current 3.8% yield is near the high end of the REIT's 10-year yield range. As if that weren't enough, the company has raised the dividend every year for more than a decade. If you like owning the biggest and the best when they go on sale, fast-growing Prologis could be the dividend stock for your portfolio.

Agree Realty is small but growing quickly

Agree Realty (NYSE: ADC) is a net lease REIT, which means its tenants are responsible for most property-level operating expenses. It is not the largest player in the sector. That would be $50 billion market cap Realty Income (NYSE: O). But Realty Income is at a point where growth is modest. Agree Realty, given its smaller $8 billion market cap, is still capable of growing quickly.

Agree is focused on single-tenant retail properties in the U. S. These assets are fairly easy to buy, sell, and release as needed. And with a portfolio of more than 2,400 properties across all 50 U.S. states, it offers ample diversification within the niche it serves. It also has plenty of opportunities for growth, despite its focus on just one property type, as net lease retail is a huge sector. The dividend yield today is about 4.2%, which is about middle of the road for the REIT.

What you are really buying is the dividend growth rate, which has stood at more than 5% for the past decade. By comparison, Realty Income's dividend growth rate over that span was roughly half that rate. If you are a growth and income investor, Agree stands out from the net lease pack today.

Go for dividend growth with these two REITs

You can find higher-yielding REITs pretty easily. But finding REITs that offer a combination of yield and attractive dividend growth prospects is a bit harder. However, that's exactly what you will get with industrial property-focused Prologis and retail-focused Agree Realty. This pair of high-yielders won't be right for every dividend investor, but for some, they will offer the perfect mix of income and income growth to make them attractive buys in July.

Should you invest $1,000 in Prologis right now?

Before you buy stock in Prologis, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Prologis wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Reuben Gregg Brewer has positions in Realty Income. The Motley Fool has positions in and recommends Prologis and Realty Income. The Motley Fool recommends the following options: long January 2026 $90 calls on Prologis. The Motley Fool has a disclosure policy.

Key Points

• W.P. Carey offers a lofty 5.8% dividend yield.

• The real estate investment trust cut its dividend in 2023.

• Investors may not appreciate the growth potential for this industrial focused net lease REIT.

The S&P 500 index (SNPINDEX: ^GSPC) is offering a tiny 1.3% or so yield and it is trading near all-time highs. That's not a great backdrop for dividend investors trying to find high-yield stocks. But if you take your time and do your research, you can still find attractive income opportunities. W.P. Carey (NYSE: WPC) and its 5.8% yield could be just what you are looking for, if you don't mind buying when other investors are selling.

What is a net lease REIT?

W.P. Carey is a net lease real estate investment trust (REIT). That means it generally owns single-tenant properties for which the tenant is responsible for most property-level expenses. W.P. Carey competes with large peers like Realty Income (NYSE: O) and NNN REIT (NYSE: NNN). Realty Income is the largest player in this segment, with a market cap of about $50 billion. W.P. Carey is No. 2 at $13 billion, with NNN REIT coming in at about $8 billion.

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Net lease REITs tend to be fairly boring and reliable income stocks. The big driver of the business is sale/leaseback deals that are more of a financing transaction for the seller. Which is why all three of these stocks are out of favor right now because higher interest rates crimp the profitability of net lease REITs and their ability to ink new deals. W.P. Carey's stock has performed the worst, down about 30% from its highs in 2019.

Some of that underperformance can be attributed to one simple fact. NNN REIT has increased its dividend annually for 36 years. Realty Income has increased its dividend annually for 30 years. W.P. Carey cut its dividend in 2023. But don't skip W.P. Carey for this reason because it has a lot to offer.

NNN data by YCharts

What's different about W.P. Carey?

The first issue to address is the dividend cut, though "dividend reset" is probably a better characterization of the event. In 2023 W.P. Carey made the decision to exit the troubled office sector and sell its office holdings. That move necessitated lowering the dividend because of the size of the office property segment in its portfolio. It is now focused on industrial, warehouse, and retail properties, all of which are more lucrative property segments. The company started increasing the dividend again the quarter after the cut and has been increased each quarter since, which is the same pattern as before the reduction.

The portfolio is in much better shape today than it was before the office exit. And the industrial and warehouse focus sets W.P. Carey apart from Realty Income and NNN, which both focus heavily on retail. Pairing W.P. Carey with one of these two net lease REIT peers could actually make a nice combination that covers a lot of ground.

But the big story is that W.P. Carey's office exit left it with cash to invest in new properties. It has been putting that money to work and that will likely boost growth during the next couple of years. Notably, net lease giant Realty Income's last dividend hike amounted to a year-over-year increase of 0.2%. W.P. Carey's last increase was over 3% year over year.

That's a trend that is likely to continue during the near term as new acquisitions start to generate cash flow. But there's more to the story, because W.P. Carey tends to build inflation-linked rent escalators into its leases. That further supports growth and sets the company apart from its peers, which aren't as aggressive on this point.

Don't discount W.P. Carey because of the cut

When investors look at the net lease REIT sector they often default to Realty Income or NNN REIT. That's not a bad thing, but don't overlook the opportunity W.P. Carey presents. Up until the dividend reset, the company had raised its payout for 24 consecutive years. And given W.P. Carey's relatively strong dividend growth, it could be well worth stepping aboard even for conservative investors once they understand the backstory.

Most important, however, is the differentiated property focus offered by W.P. Carey, given its emphasis on industrial and warehouse assets. If you are looking at Realty Income or NNN REIT, you might actually want to buy them and add W.P. Carey, too, to more fully round out your net lease exposure.

Should you invest $1,000 in W.P. Carey right now?

Before you buy stock in W.P. Carey, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and W.P. Carey wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Reuben Gregg Brewer has positions in Realty Income and W.P. Carey. The Motley Fool has positions in and recommends Realty Income. The Motley Fool has a disclosure policy.

I own a couple dozen stocks. I like each and every one of them, given that I chose them out of the thousands of potential stocks available on Wall Street. Picking just one would be difficult. Yet, given my dividend focus, I would lean toward Realty Income (NYSE: O) today. The reason is partly because of its well-above-market 5.6% dividend yield, but there's much more to like beyond that simple fact. Here's what you need to know.

What does Realty Income do?

Realty Income is a net lease real estate investment trust (REIT). It owns single-tenant properties where the tenant is responsible for most property-level operating costs. The purpose of this leasing approach is pretty simple. The tenant effectively retains operating control of the asset, and Realty Income avoids the cost and effort of taking care of the property.

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In fact, sale leaseback transactions are used in the net lease world. This means that the seller instantly becomes the lessee, usually with a long-term lease that includes regular rent bumps. It is really a financing transaction for the seller, which raises capital from the sale but still retains that all-important operational control of a vital asset. Realty Income is supplying the capital and getting a reliable tenant with a vested interest in the property. It's pretty close to a win/win transaction.

Realty Income is one of the largest and most diversified net lease REITs you can buy. Its market cap is more than three times the size of its next closest peer's. It owns over 15,600 properties. It has exposure to retail and industrial assets, and its portfolio includes properties in both North America and Europe.

To be fair, Realty Income's size is also a problem to consider. The REIT simply can't grow quickly because it is already so large. So slow and steady is the name of the game. The average annualized dividend growth rate over the past 30 years was roughly 4.1% a year. Thirty years, by the way, is the length of Realty Income's dividend streak. So it is a reliable, though slow-growing, dividend stock.

Realty Income is a foundational investment with an attractive yield

Buying just one stock really isn't a reasonable expectation, but that doesn't mean you shouldn't own some companies that are foundational investments. For those with an income bias like me, Realty Income offers just such a foundation. It's a risk/reward trade-off, for sure, but one that comes with a very attractive 5.6% dividend yield.

Putting that yield into perspective will help explain why now is a good time to buy Realty Income. For starters, the S&P 500 is only offering a yield of roughly 1.2%. The average REIT is yielding 4%. Realty Income's average yield over the past decade is a little under 4.5%. In fact, the REIT's current yield is near the high end of the yield range over the past decade.

O data by YCharts.

Realty Income isn't going to excite you. But it should continue to provide you with a healthy income stream (paid monthly) for years to come. That income stream is highly likely to keep growing, albeit slowly, over time, and that can create a strong foundation for your broader dividend portfolio. It allows you to reach out a little bit and buy stocks with lower yields but higher dividend growth rates, like Hormel Foods, Hershey, or even fellow net lease REIT Agree Realty.

Add this one to your portfolio and don't look back

I wouldn't really recommend buying just one stock, because diversification is important. Still, Realty Income is a very well-run business offering a high yield that is backed by a reliably growing dividend. It has all the hallmarks of a one-and-done type stock for income-oriented investors. If you are looking for a foundational dividend stock, Realty Income should be on your short list today.

Should you invest $1,000 in Realty Income right now?

Before you buy stock in Realty Income, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Realty Income wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $966,931!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Reuben Gregg Brewer has positions in Hershey, Hormel Foods, and Realty Income. The Motley Fool has positions in and recommends Hershey and Realty Income. The Motley Fool has a disclosure policy.

Brookfield Asset Management (NYSE: BAM) is an attractive dividend growth stock. You could also look at it as a desirable growth and income stock. The two stats backing that up are the above-market 3.1% yield and the huge 15% annual dividend growth rate that management is projecting out to the end of of the decade. What does that mean for investors? And what happens after 2030?

What does Brookfield Asset Management do?

Before looking at the dividend growth opportunity with Brookfield Asset Management, it is important to understand what the company does. It is a large Canadian asset manager with a historical focus on infrastructure. It has long invested on a global scale, as well, so it has a very broad investment universe. In recent years it has expanded the universe, too, adding a bond specialist to the mix and broadening its efforts in private equity.

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Brookfield Asset Management operates across five different platforms: renewable power, infrastructure, real estate, credit, and private equity. It believes it is positioned to benefit in all of these business lines from key long-term trends, including the shift toward clean energy, the world becoming increasingly digital, and de-globalization. The goal is to increase the fee-bearing assets it manages from $550 billion to $1.1 trillion by the end of the decade.

As an asset manager, Brookfield Asset Management charges fees for managing other people's money. So growing fee-bearing assets will lead to higher revenues and earnings. If it hits its current targets, the company believes it can grow the dividend 15% a year through the end of 2030.

What will Brookfield Asset Management look like in 2030?

Assuming Brookfield Asset Management can live up to its dividend growth goal, which is not unreasonable, the dividend will grow from about $0.44 per share per quarter to $0.88. If the stock price remains the same in 2030 as it is today, the dividend yield would increase from 3.1% to 6.3%. If, as is more likely, the stock price increases as the dividend grows, the stock will rise from around $56 per share to $112 if the yield remains at the 3.1% level. But, in the price increase example, the yield on purchase price for an investor buying today would still be 6.3%!

That's great and should interest dividend growth as well as growth and income investors. But what happens over the five years after that? If the company can keep growing the dividend by 15%, which would be a very tall order, the dividend in 2035 would be $1.77 per share per quarter. That would suggest a yield on purchase price of 12.6% and a stock price of $224 per share if the market continued to afford the stock a 3.1% yield. Wow!

However, 15% dividend growth for a decade is a pretty aggressive expectation. What if the dividend growth is just half that rate after the first five years, slowing to 7.5% a year between 2031 and 2035? In that case the dividend will grow to $1.26 per share per quarter and the yield on purchase price would fall to "only" 9%. If the stock is still yielding 3.1% in 2035, the stock price based on the higher dividend would be around $160 per share. So it is still a very attractive outcome even if Brookfield Asset Management's growth slows materially in the back half of this 10-year outlook.

A lot depends on Brookfield Asset Management's execution

These are just estimates played out using a spreadsheet. Real life is always more complicated. Brookfield Asset Management's future is highly dependent on its ability to execute and, frankly, the ups and downs of Wall Street. However, if Brookfield Asset Management can live up to its lofty goals over the next five years, it is a very attractive dividend growth/growth and income stock today. And if it can do half as well over the five years after 2030 it will still be an attractive investment over that 10-year horizon.

Should you invest $1,000 in Brookfield Asset Management right now?

Before you buy stock in Brookfield Asset Management, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Brookfield Asset Management wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $966,931!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool recommends Brookfield Asset Management. The Motley Fool has a disclosure policy.

Oil and natural gas prices can move in unexpected ways and do so in a dramatic and rapid fashion. The geopolitical conflicts playing out today are yet another evidence point that energy investors need to be prepared to deal with often headline-grabbing and perhaps shocking volatility.

If you are looking for a high-yield energy stock today, you'll be better off sticking with a reliable giant like Chevron (NYSE: CVX) or attempting to sidestep energy prices with an investment in a midstream giant like Enterprise Products Partners (NYSE: EPD). Here's what you need to know.

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1. Chevron gives you direct exposure to energy

If what you are really looking for is some exposure to oil and natural gas, then Chevron and its roughly 4.7% dividend yield could be for you. A $1,000 investment will net you around six or seven shares today. The big story here, however, is the impressive history of dividend growth, with dividend increases in each of the last 38 years.

Oil and natural gas prices have gone through many dramatic swings over that span, and still, Chevron has remained committed to supporting its dividend. It is built to survive such energy market swings. For starters, its business is diversified across the energy sector and geographically. Having exposure to the upstream (energy production), the midstream (pipelines), and the downstream (chemicals and refining) helps to soften the peaks and valleys since each segment operates a little differently through the energy cycle. Having exposure to various global energy markets on the supply and demand side allows Chevron to focus its investments in the areas with the highest returns.

Then there's the energy giant's balance sheet, which is rock solid. With a debt-to-equity ratio of around 0.2x, it has notably less leverage than most of its closest peers. This gives management the leeway to take on debt during industry weak spots so it can continue to support its business and dividend. When oil prices recover, as they always have historically, Chevron simply reduces its leverage to prepare for the next industry downturn.

Playing it as safe as possible with high-yield Chevron is a good call for dividend investors that want more direct oil exposure.

2. Enterprise Products Partners shifts the energy playbook

But you don't have to have direct exposure to oil prices if you want to invest in dividend-paying energy stocks. That's because the midstream segment is the one part of the energy industry that works a little differently. Businesses like Enterprise Products Partners own the energy infrastructure, like pipelines, that move oil, natural gas, and the products into which they get turned around the world.

What sets the midstream apart from the upstream and the downstream is that the midstream largely charges fees for the use of energy infrastructure assets. In other words, businesses like Enterprise Products Partners are just toll-takers. The volume of products moving through its portfolio of assets is more important than the price of those products. And since energy is so vital to modern life, demand for energy tends to be high regardless of the price of oil. The reliable cash flow Enterprise generates is what supports the master limited partnership's (MLP's) lofty 6.8% distribution yield.

A $1,000 investment in Enterprise will leave you owning around 31 shares of the MLP. But, like Chevron, a key part of the story here is the distribution history. Enterprise has increased its disbursement every year for 26 consecutive years. And, like Chevron, Enterprise is financially strong (it has an investment-grade-rated balance sheet) and conservatively run. The distribution yield will make up the vast majority of your total return here, but if you are trying to maximize the income your portfolio generates, that probably won't bother you.

Two solid energy options for volatile times

Given the current volatility in the energy sector, Chevron and Enterprise are good options for investors right now. But they are usually good options in the energy sector because they are built to deal with the industry's volatility while rewarding investors for sticking around with dividends. If you have $1,000 and you want to add an energy stock, one of these two will be a good dividend-focused pick for your portfolio.

Should you invest $1,000 in Chevron right now?

Before you buy stock in Chevron, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Chevron wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $966,931!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chevron. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.

Cameco (NYSE: CCJ) has gone through some very trying times in the past, largely due to its reliance on the price of a commodity when it comes to revenue and earnings. But the uranium that Cameco mines could be in for a big step change in price. Here are three reasons to buy this nuclear power industry supplier like there's no tomorrow.

1. Cameco is a picks-and-shovels nuclear play

Cameco mines for uranium, which is the primary fuel for nuclear power plants. It is also a minority owner in Westinghouse, a service provider to the nuclear power industry. Basically, it is a way to invest in nuclear power without having to buy it directly. If demand for nuclear power grows, Cameco should benefit right along with that growth.

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There is a risk here, however, because nuclear power has a history of large and very public disasters. Nuclear meltdowns, perhaps not shockingly, have led to a pullback in demand for nuclear power.

Right now, however, nuclear power is experiencing a bit of a renaissance. Notably, it doesn't produce greenhouse gasses, making it a clean energy source. And since nuclear power provides always-on (or base load) electricity, it can be paired with intermittent power sources like solar and wind to create a more reliable power grid.

All in all, Cameco's role in supporting nuclear power plants with fuel and services makes it a great way to play the nuclear power renaissance that is taking place today. And that's buttressed by the fact that its operations are largely in developed and politically stable markets, which customers appreciate just as much as investors should.

2. Demand for energy is growing

But the shift toward clean energy isn't the whole story. Demand for electricity is set to see a step change over the next 20 years or so. Between 2000 and 2020, U.S. electricity demand increased by a total of 9%. Between 2020 and 2040, demand is expected to grow by 55%. There are multiple drivers of that surge, notably including artificial intelligence (AI), data centers, and electric vehicles (EVs). Electricity use is expected to increase from 21% of final energy use to 32% by 2050.

Meanwhile, there are new nuclear plant designs and options coming to market that should make nuclear power more attractive. Safety is likely to improve, costs are likely to drop, and speed to market is likely to increase. All these factors will help to make nuclear a key part of the electric transition that is happening, which will likely mean more demand for uranium to fuel nuclear power plants.

3. Supply doesn't look like it will meet demand

So, Cameco supplies an industry that appears to be seeing increased demand. Those are two good reasons to buy the stock. But there's one more reason to consider: the difference between supply and demand. Starting in 2030, Cameco expects demand to start outstripping supply, leading to a supply gap.

That will likely result in more investment in uranium mining, of course. But the gap grows rapidly due to the lull in mine development that happened following the Fukushima nuclear plant meltdown in 2011. Building mines is time consuming, expensive, and difficult, so it seems unlikely that the supply gap will have an easy solution. And that means uranium prices are likely to remain strong, if not rise, over time as demand for the nuclear fuel grows.

A lot of reasons to like Cameco, but there's one big risk to keep in mind

There are multiple reasons to like Cameco as an investment. But it is really appropriate only for more aggressive investors. That's because of the significant risk hinted at above: nuclear meltdowns. If there's another event of this nature, the view of nuclear power could quickly sour and send uranium prices -- and Cameco's stock -- crashing. If you can't stomach that risk, then the three reasons to buy Cameco outlined above probably won't be enough to entice you to buy this stock today, tomorrow, or any day.

Should you invest $1,000 in Cameco right now?

Before you buy stock in Cameco, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Cameco wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $966,931!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool recommends Cameco. The Motley Fool has a disclosure policy.

For most investors, simple is good. The Schwab US Dividend Equity ETF (NYSEMKT: SCHD) is a simple way to invest in reliable, high-quality dividend stocks. After all, if you have a life to live, you probably don't want to spend all your free time poring over stocks.

A roughly 4% yield and a unique stock selection process seal the deal when it comes to this smart investment choice. Here's what you need to know today.

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What has the Schwab US Dividend Equity ETF done?

Before getting into the Schwab US Dividend Equity ETF's investment approach, it's important to get a good feel for what it has achieved. Many dividend investors are looking to create a reliable income stream to live on in retirement.

So the goal is to own investments that produce reliable and hopefully growing dividends. Of course, a secondary hope is that the investment's value will rise as well, producing some capital appreciation.

SCHD data by YCharts.

The chart above shows that dividend investors have gotten exactly what they wanted from this exchange-traded fund (ETF). The current dividend yield of roughly 4% is in line with a "rule of thumb" retirement withdrawal rate that has led many dividend investors to focus on creating a 4% yield from their portfolios.

So, with that 4% yield, investors won't feel the need to touch the principal invested in the Schwab US Dividend Equity ETF. That can help with a feeling of financial security, or provide confidence that there will be money left to hand on to loved ones someday.

All that comes from one simple investment with a tiny expense ratio of 0.06%. To be fair, the Schwab US Dividend Equity ETF has not performed as well as an S&P 500 index ETF on a total return basis. But that's not the goal of the ETF. The goal is to provide a reliable income stream with some capital appreciation, and it does that very well.

Don't buy the Schwab US Dividend Equity ETF until you read this

You shouldn't buy any pooled investment just because of a few performance statistics. Just as with any other ETF or mutual fund, you are giving your hard-earned money to the Schwab US Dividend Equity ETF to manage on your behalf. You need to make sure you understand what is being done with that cash.

In reality, the Schwab US Dividend Equity ETF is just tracking the Dow Jones U.S. Dividend 100 Index. What you really need to know is what that index does, which is actually fairly complex. First, it pulls out all the companies that have increased their dividends for at least 10 consecutive years. Then real estate investment trusts (REITs) are eliminated from consideration. This forms the starting pool from which the index is created.

But the 100 stocks that make it into the index haven't been selected yet. The next step is to create a composite score for all of the stocks that pass the first round of screening. The score looks at cash flow to total debt, return on equity, dividend yield, and the company's five-year dividend growth rate. The 100 stocks with the highest composite scores are included in the index and are market-cap weighted.

SCHD Dividend Yield data by YCharts.

There's a lot going on there, but the point is that the Schwab US Dividend Equity ETF is focused on owning well-run and financially strong businesses that have attractive yields and strong histories of dividend growth. That's likely the same type of stock a dividend investor is trying to find.

Buying the Schwab US Dividend Equity ETF gets you an entire portfolio of such investments with just one buying decision. That's simple, and it allows you to spend your time doing other things, like spending time with family or playing golf.

Smart investors look for simple solutions that work

The Schwab US Dividend Equity ETF isn't going to give you everything an investor dreams of, but no investment can do so. What it will do is provide you with an attractive income stream and, if history is any guide, slow and steady growth of capital over time. If that's your goal, it would be a smart choice to invest in the Schwab US Dividend Equity ETF today.

Should you invest $1,000 in Schwab U.S. Dividend Equity ETF right now?

Before you buy stock in Schwab U.S. Dividend Equity ETF, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Schwab U.S. Dividend Equity ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $966,931!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

One of the best ways to ensure an investment can reward you well for the rest of your life is to buy reliable, high-yield stocks. On that front, Enterprise Products Partners (NYSE: EPD) stands out. A well-above-market distribution yield of 6.8% is one reason for that, but so is the strength of the midstream master limited partnership's (MLP's) business and its impressive distribution history. Here's what you need to know before buying.

What does Enterprise Products Partners do?

Enterprise Products Partners owns energy infrastructure, including pipelines, storage, processing, and transportation assets. It operates in what is generally referred to as the "midstream" segment of the overall energy sector. This is very important if you are looking to set yourself up with a reliable income stream for the rest of your life.

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The "upstream" is where oil and natural gas are produced. The "downstream" is where these commodities are processed. Financial results in both the upstream and the downstream are heavily influenced by often volatile commodity prices. The midstream, which basically connects the upstream to the downstream (and the rest of the world), isn't. Midstream businesses generally charge fees for the use of their energy assets. So, demand for energy, which tends to be fairly robust through the economic cycle, is more important to financial results.

Basically, Enterprise Products Partners' core business is designed to produce reliable cash flows. And those cash flows support the MLP's lofty 6.8% distribution yield. That yield is likely to make up the lion's share of an investor's return over time, but that probably won't be a problem for income-oriented investors.

How reliable is Enterprise Products Partners?

Enterprise Products Partners' business is designed to generate reliable cash flows, but what does history say about its ability to set you up with a lifetime of reliable distributions? Well, a lot.

For starters, Enterprise has increased its distribution annually for 26 consecutive years. That notably includes increases during the coronavirus pandemic and the oil downturn in 2016, both times when it would have been easy to justify a distribution cut. In fact, peers did cut their distributions in both of those periods, including Energy Transfer (NYSE: ET) in 2020 and Kinder Morgan (NYSE: KMI) in 2016.

EPD Dividend data by YCharts

If you are looking for a reliable income investment, Enterprise Products Partners stands out. But there's more to like here than just the distribution streak. For example, Enterprise Products Partners has an investment-grade-rated balance sheet. The distribution is covered 1.7x by the MLP's distributable cash flow. Essentially, there is a lot of room for adversity before a distribution cut would likely be on the table.

The distribution seems highly likely to keep growing, as well. The first reason is inherent to the midstream business. Increasing the fees charged along with inflation is the industry norm. Meanwhile, Enterprise has a long history of growing through capital investment projects, with a $7.6 billion capital plan currently in the works. On top of those two growth levers, Enterprise happens to be large enough to act as an industry consolidator. So, the occasional acquisition is a further growth driver to keep in mind, though acquisitions are impossible to predict.

Enterprise offers a compelling story for income investors

The one caveat here is that the world is increasingly using cleaner energy sources. However, the transition is likely to take decades, and it is far more likely that an all-of-the-above strategy (that includes carbon fuels) will be the final outcome. Don't count Enterprise out because it deals with carbon energy. All in, if you are looking for an investment that can set you up with a lifetime of income, Enterprise Products Partners and its lofty 6.8% distribution yield should be on your shortlist today.

Should you invest $1,000 in Enterprise Products Partners right now?

Before you buy stock in Enterprise Products Partners, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Enterprise Products Partners wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $676,023!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,692!*

Now, it’s worth noting Stock Advisor’s total average return is 793% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Kinder Morgan. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.

Brookfield Renewable Corp. (NYSE: BEPC) is a complex entity. It has sister units that trade as Brookfield Renewable Partners (NYSE: BEP), and both are run by another company, Brookfield Asset Management (NYSE: BAM).

But given the plans Brookfield Asset Management has for investing in clean energy, high-yielding Brookfield Renewable Corp. could set you up with a lifetime of reliable income.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Here's what you need to know before buying it.

What is Brookfield Renewable Corp.?

From a high-level view, Brookfield Renewable Corp. is a source of permanent capital for Brookfield Asset Management. So, too, is the sister unit, Brookfield Renewable Partners. In fact, they represent the exact same business and pay the exact same quarterly dividend amount. But Brookfield Renewable Corp.'s dividend yield is 4.7%, and Brookfield Renewable Partners' distribution yield is 5.8%.

How can these two Brookfield entities be the same but have different yields? That gets to the heart of the issue.

Brookfield Renewable Partners existed first, but as a partnership, many institutional investors couldn't buy it (institutional investors are often barred from buying partnerships by their investment mandates). So Brookfield Renewable Corp. was created to allow a larger pool of investors to buy into the Brookfield entity. The yield difference reflects the fact that the corporate share class is more popular than the partnership units.

And this all ties back to the fact that Brookfield Asset Management runs Brookfield Renewable. In either form, it is really just a way to invest alongside Brookfield Asset Management as it invests in clean energy infrastructure.

Infrastructure has long been the Canadian asset manager's specialty. Brookfield Renewable is valuable to Brookfield Asset Management because once it sells a unit or share, that unit or share continues to exist until it is bought back by Brookfield Renewable. In other words, the cash raised doesn't have to be repaid, like a bond would require.

That's a lot to work through, but it is important to understand as you think about buying Brookfield Renewable Corp. and its lofty 4.7% dividend yield.

What does Brookfield Renewable Corp. do?

With that foundation, it is time to examine the actual business of Brookfield Renewable. As its name implies, it owns renewable power assets. Its portfolio spans across solar, wind, hydroelectric, and battery storage. More recently, it added nuclear power to the equation.

It basically provides exposure to every kind of clean energy power source that is scalable. And it invests on a global scale, with operations in North America, South America, Europe, and Asia. Brookfield Renewable, in either corporate or partnership form, is basically a one-stop-shop for clean energy investing.

The dividend here has grown steadily over time as Brookfield Renewable's portfolio has grown. The goal is for annual dividend increases of between 5% and 9%. The long-term growth that backs those increases will come as Brookfield Renewable is used as a funding source to support Brookfield Asset Management's growth plans. And those plans include roughly doubling the asset manager's investment in clean energy between 2025 and 2030.

While it would be hard to suggest that growth is locked in, it seems highly likely that Brookfield Renewable Corp. will have the wind at its back on the growth front. But there's another wrinkle to keep in mind.

Brookfield Renewable's parent is an asset manager, and it is always buying and selling assets. Thus, Brookfield Renewable's portfolio is always changing, too. This is not a regulated electric utility and shouldn't be viewed as one, even though the energy contracts that back the business create a reliable income stream.

Can Brookfield Renewable Corp. set you up for life?

Given the purpose of Brookfield Renewable Corp. and Brookfield Asset Management's growth plans, it seems highly likely that buying Brookfield Renewable Corp. can set you up with a lifetime of reliable income. So, too, could higher yielding Brookfield Renewable Partners, if you don't mind owning a partnership. But the key is to understand what you are buying, given the complexity of the interconnections that exist here.

Should you invest $1,000 in Brookfield Renewable right now?

Before you buy stock in Brookfield Renewable, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Brookfield Renewable wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $676,023!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,692!*

Now, it’s worth noting Stock Advisor’s total average return is 793% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

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*Stock Advisor returns as of June 23, 2025

Reuben Gregg Brewer has positions in Brookfield Renewable Partners. The Motley Fool recommends Brookfield Asset Management, Brookfield Renewable, and Brookfield Renewable Partners. The Motley Fool has a disclosure policy.

Gold is seen by some as a safe-haven investment in times of economic and political uncertainty. For those looking to buy it, there are multiple ways to own gold, from simply buying bullion (gold coins or bars) to investing in precious metal mining companies.

If you are thinking about investing in gold now (or anytime), there's also a unique niche in the gold space that is worth exploring further. If it's to your liking, it's also why Franco-Nevada (NYSE: FNV) could be worth a $10,000 investment right now.

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What does gold do?

Gold is a metal -- it doesn't really do anything. That's kind of a joke, but it's also true. If you buy an ounce of gold (for instance, a single 1-ounce gold American Eagle coin), it will always and only ever be 1 ounce of gold. It can't grow into more than that, so the price change in gold is the only thing that will impact that coin's value.

And, while you own that gold, you'll need to put it somewhere safe. That's not too big a deal for one coin, but if you own a lot of gold coins, it becomes a bit more problematic. There are also transaction fees to consider, with gold coins being a rather expensive way to buy the metal, given the markups that coin dealers tend to impose so they can make a living.

All in, gold coins aren't always the best way to own gold unless you truly believe that the world economic order is going to collapse. If that happens, you may need to spend those coins. If that outcome doesn't come to pass, then gold is really more of a hedge against bad economic outcomes.

You could invest in gold in some other way. For example, you can buy exchange-traded funds (ETFs) that directly own gold. That's fine, but high costs and the "gold is only gold" issue are still at play.

A better option for many investors is buying stock in gold miners. Precious metals miners normally mine for more than just gold, but the key here is really the opportunity for a business to grow over time. The financial performance of precious metals miners rises and falls with the price of the metals they produce, so gold prices are still a key factor. However, over time, investors can benefit from new mines, upgrades of old mines, and acquisitions.

But there's an even better option in streaming and royalty companies like Franco-Nevada.

What does Franco-Nevada do?

One of the big problems with miners is that the process of running a mine is expensive. So, when precious metals prices are low, miners often lose money.

Franco-Nevada sidesteps that risk because it provides miners with cash up front (which is used to build mines and expand existing assets, among other things) for the right to buy gold and other metals at advantaged prices in the future. These are called streams and royalties. Essentially, Franco-Nevada is locking in good prices that pretty much ensure it will make a profit when it goes to sell the precious metals it buys.

The proof of the sustainability of Franco-Nevada's business model comes from its dividend. The Canadian company has increased its dividend annually for 18 consecutive years, which is roughly how long the business has existed.

If you are a dividend investor looking for a way to invest in gold, Franco-Nevada is a solid option. That said, the dividend yield is a tiny 0.9%. You aren't buying for the yield -- you are buying for the diversification benefit gold may offer your portfolio.

Data by YCharts.

Diversification, meanwhile, is where Franco-Nevada shines. It invests in gold and silver streams, which make up the lion's share of its assets. But it also invests in energy and other metals.

Gold prices can be volatile, so having a little diversification with other so-called "hard assets" is likely to be a good idea for most investors. In the end, you are likely looking for a hedge to protect against adversity, not going all-in with a 100% bet on gold. Franco-Nevada offers that hedge with broader commodity exposure than its closest peers. Note that most investors should probably keep 10% or even less of their portfolio in gold, anyway.

What does $10,000 get you with Franco-Nevada?

Franco-Nevada's share price is around $170 today, so $10,000 will net you around 58 shares. But that's not really what you are getting when you buy the stock. What you are getting is peace of mind, since you'll be adding a hard asset to your portfolio mix that Wall Street has long seen as a safe-haven investment. So long as you don't go overboard, a small investment in Franco-Nevada can go a long way in helping you sleep at night when markets get volatile.

Should you invest $1,000 in Franco-Nevada right now?

Before you buy stock in Franco-Nevada, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Franco-Nevada wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $658,297!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,386!*

Now, it’s worth noting Stock Advisor’s total average return is 992% — a market-crushing outperformance compared to 172% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

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Reuben Gregg Brewer has positions in Franco-Nevada. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Exchange-traded funds (ETFs) have changed the face of investing, helping investors to conveniently simplify their lives at low cost. But there are so many ETFs at this point that it can be confusing to find the ones that are best for your portfolio. Here are four of the best dividend ETFs for your portfolio if you lean toward dividend investing.

1. Vanguard Dividend Appreciation ETF

The first ETF up is the Vanguard Dividend Appreciation ETF (NYSEMKT: VIG). It has the lowest yield here at around 1.8%. That's pretty miserly, but it is still notably higher than the 1.3% dividend yield of the S&P 500 index. The interesting overlay here is that, like the S&P 500 index, the Vanguard Dividend Appreciation ETF owns a fairly large number of stocks, with around 300 holdings.

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VIG data by YCharts.

The ETF's construction is fairly simple. The first step is to create a list of all U.S. companies that have increased their dividends annually for at least a decade. Then the highest-yielding 25% of the companies are eliminated (high yield is clearly not the focus here). The companies that are left are put into the Vanguard Dividend Appreciation ETF with a market-cap weighting.

The ETF hasn't kept pace with the S&P 500 index over time, but if you like the idea of a broadly diversified portfolio filled with stocks that have a history of regularly hiking their dividends, this could be the right ETF for you. Notably, the dividend has doubled over the past decade, which suggests that a lower starting yield can still have a big income effect if you hold this ETF for the long term.

2. Vanguard High Dividend Yield ETF

Next up is the Vanguard High Dividend Yield ETF (NYSEMKT: VYM). This exchange-traded fund is pretty simple, too. It takes all of the dividend-paying stocks on U.S. exchanges and then buys the 50% of the list with the highest yields. The portfolio is weighted by market cap. This ETF has over 500 holdings, so its portfolio is even more diversified than the Vanguard Dividend Appreciation ETF. The dividend yield is around 2.9%.

VOO Dividend Yield data by YCharts.

Given the focus on yield here, the Vanguard High Dividend ETF has lagged the S&P 500 index over time by an even greater amount than the Vanguard Dividend Appreciation ETF. But if your goal is to maximize the income your portfolio generates, it could be a great foundational investment. Essentially, these two Vanguard ETFs offer wide diversification and dividends in ways that will meet the investment needs of dividend growth investors and, in this situation, high yield investors.

3. SPDR Portfolio S&P 500 High Dividend ETF

The SPDR Portfolio S&P 500 High Dividend ETF (NYSEMKT: SPYD), meanwhile, allows you to stick with S&P 500 index stocks, but do so with a high-yield focus. It simply buys the 80 highest-yielding S&P 500 stocks, weighting them equally. Equal weighting allows each stock to affect performance to the same degree and helps to reduce the risk that any one stock will overly hamper performance. The dividend yield is an attractive 4.5%, the highest on this list.

SPYD data by YCharts.

Don't buy this ETF looking for material dividend growth over time. The dividend is going to make up a material portion of an investor's total return, but it hasn't risen much over time. However, if you want to maximize income with a hand-selected portfolio of large market capitalization and economically important businesses, the SPDR Portfolio S&P 500 High Dividend ETF should be a top contender.

4. Schwab US Dividend Equity ETF

The Schwab US Dividend Equity ETF (NYSEMKT: SCHD) is by far the most complicated ETF on this list. But it might also be the most attractive, as it manages to mix dividend growth with an attractively high yield. The process starts with the list of companies that have increased their dividends annually for 10 consecutive years. A composite score is created for each of the companies that includes cash flow to total debt, return on equity, dividend yield, and a company's five-year dividend growth rate. The 100 highest-rated companies get included in the ETF and are market-cap weighted.

SCHD data by YCharts.

The end result has been a strongly performing share price, a growing dividend payment, and, today, a roughly 4% yield. The Schwab US Dividend Equity ETF isn't the most diversified, and it isn't the highest-yielding. But it provides a very attractive mix of the two. And, interestingly, it has managed to grow its dividend at a faster clip than the Vanguard Dividend Appreciation ETF.

For many dividend investors, the Schwab US Dividend Equity ETF's approach of using a fairly complex composite score to select stocks will be the most attractive choice. That said, investors need to recognize that this ETF isn't a simple one to understand. If you don't buy into the screening approach, you probably shouldn't buy the ETF.

Dividend options for every kind of dividend investor

Everyone has a slightly different approach to investing. This quartet of dividend-focused ETFs offers up four different dividend investing styles -- from dividend growth to high yield, and a notable choice that successfully manages to bring different investment tactics into one complex and high-yielding ETF. If you are looking for the best dividend ETF for your portfolio, one of these four ETFs will likely be exactly what you are trying to find.

Should you invest $1,000 in Schwab U.S. Dividend Equity ETF right now?

Before you buy stock in Schwab U.S. Dividend Equity ETF, consider this:

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Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

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Dividend investors are often drawn to high yields like moths to a flame. When it comes to yields today, there are few that are loftier than AGNC Investment's (NASDAQ: AGNC) 15%-plus dividend yield. Yet if history is any guide, most investors would be better off buying the Vanguard Dividend Appreciation ETF (NYSEMKT: VIG) instead, even though it only has a relatively modest 1.8% yield. Here's why.

What do AGNC Investment and Vanguard Dividend Appreciation ETF do?

AGNC Investment is a mortgage real estate investment trust (mREIT). That's a fairly complex niche within the broader REIT sector. AGNC Investment buys mortgages that have been rolled up into bond-like investments, often making use of leverage to do so. Mortgage securities prices can be impacted by interest rates, housing market dynamics, and mortgage repayment trends, among other things. And they trade all day, so stocks like AGNC Investment can be fairly volatile.

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The Vanguard Dividend Appreciation ETF is a diversified exchange-traded fund (ETF). It tracks the S&P U.S. Dividend Growers index. That index starts by taking all of the U.S. companies that have increased their dividends for at least 10 consecutive years and then removes the highest yielding 25% of the list. The rest get into the index (and the ETF) based on a market cap weighting. Note that it is specifically avoiding the highest-yielding stocks.

Income versus total return and back to income again

Here's the interesting thing: AGNC Investment is very clear that income is not its primary goal. Management says its goal is "Favorable long-term stockholder returns with a substantial yield component." That means that delivering a strong total return, which assumes dividend reinvestment, is the main goal, and AGNC Investment has done reasonably well at hitting that target.

AGNC Total Return Level data by YCharts.

Looking at the entire span that both AGNC Investment and Vanguard Dividend Appreciation ETF have existed, AGNC Investment has provided a slightly better total return. But take a look at the dividend and price history of each of these investments. After early spikes in the dividend and price of AGNC, it has been all downhill. By contrast, the Vanguard Dividend Appreciation ETF's dividend payouts and share price have both generally risen over time.

AGNC data by YCharts.

A strong total return is great, but that metric is based on the assumption that you're reinvesting your dividends. Income investors are usually looking to live off of the dividends their investments generate, which means spending them. As the chart above makes very clear, AGNC Investment's dividend payouts haven't been sustainable, while the smaller payouts from Vanguard Dividend Appreciation ETF were sustainable and generally grew over time.

In fact, AGNC Investment has over time reduced its payouts by more than 60% while the total payouts from the components of the Vanguard Dividend Appreciation ETF have increased by more than 200%. For someone whose plans over that period involved using the dividends their portfolio generated to help cover their living expenses, it's pretty clear which investment would have been the better choice.

AGNC isn't a bad investment

AGNC Investment isn't a bad investment -- it's just one that requires a more nuanced view. Yes, its dividend yield is huge, but that doesn't necessarily make it a good income stock. The real gains from owning it come from reinvesting the dividends and focusing on total return, which is not what most dividend investors are likely to be doing. If you are trying to live off of the income your portfolio generates, the Vanguard Dividend Appreciation ETF, despite its much lower yield, will probably be a better choice for your portfolio.

Should you invest $1,000 in AGNC Investment Corp. right now?

Before you buy stock in AGNC Investment Corp., consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and AGNC Investment Corp. wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

Now, it’s worth noting Stock Advisor’s total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 2, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard Dividend Appreciation ETF. The Motley Fool has a disclosure policy.

Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) is one of the most successful companies in modern history. Its CEO, Warren Buffett, is a Wall Street legend who has been given the nickname "the Oracle of Omaha." If you are an investor, it's highly likely that you know all about Buffett and the company he runs. But do you know about Markel Group (NYSE: MKL)?

What does Berkshire Hathaway do?

Because of its large insurance operations, Berkshire Hathaway usually gets placed in the finance sector. That's not a bad classification for the company, but it doesn't do justice to the business at all. That's because Berkshire Hathaway is actually a widely diversified conglomerate. The collection of businesses under the Berkshire Hathaway umbrella ranges from auto sales to retail to specialty parts manufacturing. And it has a whole lot in between -- its list of subsidiaries includes over 180 companies.

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Even the insurance operations are used in a slightly different manner than they are at most other insurers. The float, which arises because insurance premiums get paid up front while claims get paid in the future, is used to buy stocks like Coca-Cola, American Express, and Chevron. The diversity in the list of stock investments is just as wide as the diversity in Berkshire Hathaway's owned businesses.

Investors buying Berkshire Hathaway are really investing alongside Warren Buffett. But at the end of 2025, Buffett is retiring from the $1 trillion market cap company he basically created via his unique investment approach. His hand-picked successor, Greg Abel, will likely continue to use a similar approach to that of his mentor Buffett, buying well-run companies while they are attractively priced and then holding on for the long term to benefit from the business' growth over time. But there's no question that Berkshire Hathaway won't be exactly the same in the future as it has been in the past.

What does Markel Group do?

Markel Group, with a market cap of around $25 billion, is a much smaller business than Berkshire Hathaway. But it doesn't pull any punches when it describes its business, making frequent references to Berkshire Hathaway. It also uses the same exact model, of an insurance company that directly owns companies and invests in publicly traded stocks (including Home Depot, Visa, and Deere).

Interestingly, the stock performance of Markel Group hasn't been as strong as that of Berkshire Hathaway or the S&P 500 index (SNPINDEX: ^GSPC) since the 2020 bear market. But Markel's management has been working to shake things up so it can get back to its historical performance, which was actually better than that of Berkshire Hathaway for many years.

This is where the really interesting comparison comes up. Berkshire Hathaway is at the start of a management shake-up. Markel Group is nearer the end of such a shake-up. Berkshire Hathaway's new leader is taking over a company so large that it requires very large changes to affect performance. Markel Group is still small enough that improving the business won't require massive changes. In some ways, and from a big-picture perspective, it sounds like Markel Group is in a better position as a business right now.

Trade down, but perhaps only in size

The world will never see another Warren Buffett because he is a unique individual. But his broad investment approach can be roughly mimicked. Mimicking Buffett is basically what Wall Street wants Greg Abel's job to be when he takes over as CEO of Berkshire Hathaway at the end of 2025. Only he's going to have to do it within the confines of a gigantic company, which means it will be a massive task.

Markel Group has been mimicking Buffett for years. While the company seemingly lost its way to some extent over the last five years, it is working to get back on track. Given the relatively small size of the business, that shouldn't be nearly as large a job as what Greg Abel is dealing with. If you like Berkshire Hathaway, now could be a good time to start looking at Markel Group, where imitation has long been a high form of flattery to Warren Buffett.

Should you invest $1,000 in Markel Group right now?

Before you buy stock in Markel Group, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Markel Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

Now, it’s worth noting Stock Advisor’s total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 2, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway, Chevron, Deere & Company, Home Depot, Markel Group, and Visa. The Motley Fool has a disclosure policy.

AGNC Investment (NASDAQ: AGNC) has a gigantic 15%+ dividend yield. That lofty yield sounds very enticing, but sometimes things that sound too good to be true are, in fact, too good to be true. Here's why investors need to take a very nuanced view of AGNC Investment and how the company may actually be helping you decide when to buy the stock.

What does AGNC Investment do?

Property-owning real estate investment trusts (REITs) buy physical properties and lease them out to tenants. That's what you would do if you owned a rental property, so it's probably fairly easy to wrap your head around the business model. Mortgage REITs like AGNC Investment buy mortgages that have been pooled together into bond-like securities. That's a lot more complex and you probably couldn't mimic that in your own investment life.

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Everything from interest rates to mortgage repayment rates can impact the value of mortgage securities. So even tracking what is going on within AGNC Investment's portfolio, or within any mortgage REIT, would be hard for most investors. Adding to the complexity is that mortgage securities trade all day long, so the portfolio's characteristics can change fairly quickly.

This is not an investment for conservative income investors. That fact is highlighted by the steady downtrend in the dividend over the last decade or so, as the chart below highlights. Not surprisingly, the price of the stock has trailed the falling dividend.

AGNC data by YCharts

What is AGNC Investment worth?

That said, AGNC Investment's value is basically the value of its portfolio of mortgage securities. In that way it is kind of similar to a mutual fund. And, like a mutual fund, AGNC Investment reports the value of its portfolio on a per-share basis. It calls this number tangible net book value per share. It only reports that number quarterly, but it is an important figure to monitor.

At the end of the first quarter of 2025 AGNC Investment's tangible net book value per share was $8.25. At the end of the first quarter of 2022 it was $13.12. Tangible net book value per share can rise and fall fairly dramatically at times, depending on the market environment. Over the past year, for example, this metric has risen and fallen by 5% between quarters multiple times. It is, at best, a rough gauge for investors to monitor between quarters.

But the really interesting thing here is that AGNC Investment's stock price often trades above tangible net book value per share. Sometimes dramatically above the number -- the 52-week high is $10.85 even though the reported tangible net book value per share never rose above $8.84 in any of the last four quarters.

This is great news for shareholders, since AGNC Investment frequently sells new shares to the public to raise additional capital. Every penny above tangible net book value that a new buyer pays is tantamount to giving current shareholders free money. Management even explains this fact when it discusses stock sales, saying things like the company "opportunistically" raised money "at a considerable premium to tangible net book value" and that this brings "meaningful book value accretion to our common stockholders."

AGNC data by YCharts

The takeaway here is pretty clear. Nobody should pay more than tangible net book value per share for AGNC Investment unless they believe that number is going to be headed sharply higher. But sometimes AGNC Investment's share price dips below that figure, with the 52-week low coming in at $7.85. The company would likely not be raising capital at that price, given that it would destroy value for current shareholders. However, if you buy the stock on the open market below book value you are increasing the chances that you are getting a good deal on the stock.

AGNC data by YCharts

The fly in the ointment is the dividend

The problem with this discussion is that it doesn't address the dividend or the dividend yield. That's because the company's focus isn't income, it is total return. The dividend is a part of total return, but total return assumes the dividend is reinvested. But a key part of total return is also the price you pay for the investment.

If you bought at the 52-week high price of $10.85 per share, your total return would be terrible here even with the huge dividend yield. However, if you kept a close eye on tangible book value per share and only bought when the stock price was at or below the last reported figure, your total return would likely still be positive, helped along by that lofty yield.

Should you invest $1,000 in AGNC Investment Corp. right now?

Before you buy stock in AGNC Investment Corp., consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and AGNC Investment Corp. wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

Now, it’s worth noting Stock Advisor’s total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 2, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Federal Realty (NYSE: FRT) is not the largest real estate investment trust (REIT) you can buy. It isn't even the largest REIT in its strip mall niche. It actually has a fairly small collection of properties in its portfolio. And yet it stands head and shoulders above every other REIT when it comes to its dividend. Here's why now is a good time to consider adding Federal Realty and its industry-leading business to your portfolio.

What does Federal Realty do?

Federal Realty owns strip malls and mixed-use properties, which generally include apartments and offices in the mix with retail. Some of the REIT's individual properties are quite large developments with multiyear projects on them. Others are simple strip malls where locals go to meet their everyday needs, like buying groceries or getting a haircut.

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From this perspective, Federal Realty isn't particularly differentiated from its competitors. That changes when you see that it only owns around 100 properties, which is generally a much smaller portfolio than its closest peers. However, those properties are particularly well located, with Federal Realty's assets having a higher average income around them and higher average population density. In other words, its portfolio is focused in wealthy areas with lots of residents nearby, which is exactly where retailers want to be located.

The strength of Federal Realty's portfolio today is highlighted by its occupancy rates. After dipping during the coronavirus pandemic, they are now back above that level and closing in on 20-year highs. Occupancy ended the first quarter of 2025 at 93.6% but is expected to close in on 95% as the year progresses. Even during the pandemic, when non-essential businesses were closed by the government in an attempt to slow the spread of COVID-19, Federal Realty's occupancy didn't fall below 89%.

FRT Dividend data by YCharts

The real story, however, is Federal Realty's dividend, which has been increased annually for 57 consecutive years. That makes the REIT a Dividend King, which alone is an impressive feat. But there's two more nuances here. First, Federal Realty has the longest dividend streak of any REIT. Second, it is the only REIT that is a Dividend King. Having a small, well-positioned portfolio has clearly paid off.

Federal Realty's strength is in development and redevelopment

Federal Realty didn't just buy 100 or so properties 57 years ago and sit on them for half a century. It is actually a quite active buyer and seller of assets. The key to its long-term success is what it does with the assets it buys.

Usually Federal Realty buys well-located properties that need a little love and attention. That could be as simple as a coat of paint and more focus on tenant quality. A refresh of a property's exterior to make it look up to date goes a long way in attracting customers and tenants. But often the capital investments being made are far more extensive.

Federal Realty will usually add to the properties it buys in some way. That can include adding apartments and offices above street-level retail space. It can involve tearing down an entire property and rebuilding it from scratch. Or it can be as simple as getting the permitting to make changes, which alone adds value to a property. When Federal Realty believes that it can sell a property for an attractive price, it will do so and then go on the hunt for another property that it can work on to improve its value over time.

In other words, Federal Realty's portfolio is in a near-constant state of flux. And the inherent push is for the improvement in the quality of its portfolio. Management knows from experience that well maintained and located properties attract tenants, customers, and buyers, and that is the REIT's guiding star.

A great REIT with an attractive yield

Given the quality of Federal Realty's business model, highlighted by its Dividend King status, the shares don't go on sale very often. Today the dividend yield is 4.6%, which is notably higher than the S&P 500 index's (SNPINDEX: ^GSPC) 1.3% and the average REIT's 4.1%. Federal Realty's yield is also near the high side of the range over the past decade. If you are looking for a reliable dividend backed by a high-performing business, Federal Realty should probably be on your short list today.

Should you invest $1,000 in Federal Realty Investment Trust right now?

Before you buy stock in Federal Realty Investment Trust, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Federal Realty Investment Trust wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

Now, it’s worth noting Stock Advisor’s total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 2, 2025

Reuben Gregg Brewer has positions in Federal Realty Investment Trust. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The world is in the middle of an energy transition. It isn't the first time it has gone through a transition, so there's a rough roadmap when it comes to understanding what comes next. The big picture is that energy transitions take decades to play out. That's why dividend investors should be looking closely at this clean energy-focused investment and its major yield.

What is going on with power?

The modern world doesn't exist without reliable power. That's the core factor to consider here as you examine the energy landscape that exists today and what that landscape may look like tomorrow. Since power isn't optional, the big-picture shift away from dirtier carbon fuels toward cleaner ones that is taking place today simply can't happen overnight. It has to be a slow and steady transition.

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In fact, even some of the oldest energy sources haven't been eliminated, even though they have been usurped by newer energy sources. For example, burning wood is still a frequently used power option. While coal use has been falling in the United States, usually being replaced by cleaner-burning natural gas, coal is still a huge force in the world.

That brings the story to solar, wind, and energy storage. These sources of power are growing rapidly and will likely continue to do so for many years. In the United States alone, wind power is projected to increase 5x over by 2050. Solar is expected to increase by 7x. And battery storage, which is very small today, is projected to grow so much that the numbers aren't meaningful.

The big takeaway is that there's likely to be huge growth ahead for clean energy investments. One of the best ways to take advantage of that growth is Brookfield Renewable (NYSE: BEP)(NYSE: BEPC) and its lofty yield of up to 6.2%.

What does Brookfield Renewable do?

Brookfield Renewable is controlled by Brookfield Asset Management (NYSE: BAM). Brookfield Asset Management has a 100-year-plus history of successfully buying, operating, and selling infrastructure assets on a global scale. This is actually an important fact to keep in mind because Brookfield Renewable is not operated like a utility. It's operated more like a private equity shop, buying, operating, and selling assets over time.

Brookfield Renewable's portfolio spans the entire clean energy spectrum. It owns hydroelectric, solar, wind, battery, and even nuclear power businesses. Those businesses are spread across North America, South America, Europe, and Asia. Given the multi-decade growth opportunity ahead, Brookfield Renewable is likely to see material growth in its business, and it can play wherever clean energy growth is offering the most attractive investment opportunities.

There are two ways to buy Brookfield Renewable. The most attractive, yield-wise, is a partnership share class, which is the one with the 6.2% yield. But for investors who prefer to avoid partnerships, there is also a corporate share class that has a dividend yield of around 5%. The only difference between the two share classes is demand, with many large institutional investors barred from owning partnerships. Small investors will probably prefer the higher-yielding partnership, which is structured so that it doesn't run afoul of the rules for tax-advantaged retirement accounts.

Brookfield Renewable is unloved for the wrong reasons

Brookfield Renewable has been a poor performer on Wall Street as excitement over clean energy has waned. With a pullback on government support in the U.S. market, it would seem like now is a bad time to invest in clean energy. But Brookfield Renewable doesn't expect the U.S. government's pullback to affect it much, if at all. It generally works with companies under long-term contracts, and companies around the world remain committed to shifting toward clean energy.

Moreover, the backing of Brookfield Asset Management means there are still some very deep pockets backing Brookfield Renewable as it looks to grow. Since Brookfield Asset Management's goal is to roughly double its investment in clean energy over the next five years, it seems highly likely that Brookfield Renewable will grow right along with its parent. If you are looking for a high-yielding investment today, clean energy-focused Brookfield Renewable should be on your short list.

Should you invest $1,000 in Brookfield Renewable Partners right now?

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Reuben Gregg Brewer has positions in Brookfield Renewable Partners. The Motley Fool recommends Brookfield Asset Management, Brookfield Renewable, and Brookfield Renewable Partners. The Motley Fool has a disclosure policy.