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News  ›  The Motley Fool

The Smartest Dividend Stocks to Buy With $5,000 Right Now

The Motley Fool Logo The Motley Fool By Will Healy
The Smartest Dividend Stocks to Buy With $5,000 Right Now

The article recommends two dividend stocks for investors with $5,000: Realty Income (O), a REIT offering a 5.6% dividend yield with monthly payouts and strong cash flow coverage, and AT&T (T), which provides a 4.6% yield with sustainable dividends backed by $17 billion in trailing free cash flow. Both stocks offer income generation with potential upside from growth initiatives and favorable valuations.

Insights
O   positive

Strong 5.6% dividend yield significantly above S&P 500 average, consistent monthly dividend payments with 31-year streak of annual increases, 99% property occupancy, FFO of $4.20 per share well above $3.24 annual dividend indicating safety, and stock trading 30% below 2020 highs offering potential upside.