My Dividend Income Portfolio for Daily Cash Flow
Dividends EVERY SINGLE DAY! You know that rush you get seeing a dividend hit your account, how about getting that dividend income every day of the month!
In this video, I’ll show you how to create a dividend income portfolio that will not only create that cash flow but produce dividend yields twice the market average!
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How to Get Dividends Every Day
Nation, I am excited for this video and the series we’re starting. Those of you in the Nation know I’m a big fan of dividends, like screaming mega fan. Dividends historically have accounted for 40% of the total market return and who doesn’t like getting paid while you invest.
We’ve talked about monthly dividend stocks here on the channel and even getting your dividends every week…but now I’m putting together a dividend income portfolio that will produce cash flow EVERY DAY OF THE MONTH!
The goal here is going to be about 70 to 80 stocks that will generate a dividend income on every weekday of each month. Since most dividend dates are extremely consistent and most companies pay out every three months, that means I’ll be doing four videos, each with about 15 to 20 dividend stocks to buy that will create this daily cash flow.
And the best part, not only is this going to be a well-diversified portfolio producing constant dividends, I’ve picked the best dividend stocks with a yield of nearly 3.5%…that’s almost twice the average dividend yield on the market.
I’ll be putting this video and the other three into a playlist on the channel called Daily Dividend Income Portfolio, make sure you smash that subscribe button so you get notified when those come out.
How to Create a Portfolio for Dividend Income Every Day
Now, how this is going to work, is over the next four months, I’ll highlight those dividend income stocks that will be paying out in the next month. For example, today we’ll highlight 20 dividend stocks that will pay out in October, January, April and July.
We’ll get started here but understand, while those dividend dates are extremely consistent, companies like to pay on the same week and even the same day each year, they can change a little so technically the portfolio might pay out two dividends on one day and nothing the next but it’s still going to be about five a week.
20 Dividend Income Stocks to Buy
Our first four daily dividend income stocks produce an average yield of 4.75% and come from four of the most stable sectors in the market. Let’s start with $163 billion drug-maker AbbVie, ticker ABBV, and it’s 5.1% dividend yield.
I like AbbVie here not only for that solid dividend payment, which has doubled over the last five years, but it’s recent acquisition of Allergan has really helped to fill the pipeline. Drugs from the Allergan portfolio helped boost sales by 26% in the last quarter and the company has several pipeline drugs that could hit big.
AbbVie is one of the last to go ex-dividend in this group, usually around October 14th, so you’ve still got time to buy the shares. Remember, stocks usually pay out their dividend two or three weeks after going ex-dividend but you have to own them before that date to collect.
Next here is Edison International, ticker EIX, and its 4.9% dividend yield.
Not only does Edison offer a high yield but this is a great value play in the utilities sector. California regulators approved the company on August 27th for its electric vehicle and battery storage plans which means this company could lead the way in charging stations and infrastructure.
The company will argue for its 2021 through ’24 rate case later this year which could boost the shares further from here.
Edison generally goes ex-dividend late September, around the 27th, so just a couple of weeks to pickup the shares.
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US Bancorp, ticker USB, is next on our list with a 4.6% dividend and another value play.
Besides that value play, I like shares of Bancorp here as one of the strongest regional banks with returns on equity well above its peer group. The bank has a great mix of fee-generating business which will help it in this low interest rate environment and it’s just generally a solid stock.
USB also goes ex-dividend around the end of September, right around the same time as Edison International.
Our fourth stock in this first group of dividend payers is actually a monthly dividend stock, Realty Income, ticker O, and a 4.5% yield.
Now much of Realty Income’s properties are in the retail market but the majority is that consumer staples type like pharmacy and convenience. That means I’m not too worried about the retail apocalypse and in fact, occupancy has never been below 96% at the properties.
Realty Income pays its dividend on a monthly basis, usually going ex-dividend towards the end of the month, so this one is going to produce that cash flow 12 days a year.
Our next four dividend income stocks start with healthcare distributor, Cardinal Health, ticker CAH, and a 3.8% dividend.
Cardinal is one of my favorite forever stocks. Between AmerisourceBergen, Cardinal Health and McKesson, these three companies control 90% of the pharmaceutical wholesale market in the country. Even if we do see true enthusiasm for drug price controls from the government, which is a long-shot to start, then I think it’s likely the industry can negotiate a compromise that still maintains solid profits while moderating price increases.
Management has identified over $300 million in cost savings it can drive this year and next which could rocket free cash flow.
Shares of Cardinal Health generally go ex-dividend in the last few days of the month, around the same time as Realty Income.
Another company with some great market forces behind it, Mastercard, ticker MA, and its half a percent yield.
OK, so normally a half percent dividend wouldn’t qualify as a dividend stock in my book but shares of Mastercard have produced a market-busting 32% annual return over the last five years and that dividend has climbed by 20% a year.
Now the pandemic has hit the company’s cross border fees but retail transactions are holding up and this one is really at the forefront of the shift to digital transactions. I like it over Visa here and am picking up shares myself before that 8-October ex-dividend date.
Dollar General, ticker DG, is another one here with a relatively weak dividend but a strong 10% annual increase in the payment.
So while this is a dividend income portfolio, I think you can buy shares like Dollar General, which has produced a 25% annual return over the last five years, pick up shares like this that might not put as much dividend cash in your pocket and still be happy as your portfolio grows.
DG has a strong store network and is able to use grocery staple products like milk and bread to upsell people into the higher profit stuff in the store. And with about 80% of the store merchandise priced under $5, this is a great one if the economy starts to wobble and shoppers get price conscious.
DG goes ex-dividend towards the end of that first week in October so still a couple of weeks here.
Shares of 130-year old McCormick & Company, ticker MKC make are list next with a 1.2% dividend yield.
McCormick is easily the leader in the $11 billion global spices market with a 20% share, four-times larger than its next largest competitor. That gives it unrivaled pricing power with stores and premium shelf space.
The grocer retailer segment accounts for 80% of sales so the drop in restaurant orders hasn’t hurt as much and in fact, shares are up 25% since the beginning of the year.
McCormick shares go ex-dividend early in October so you’ll get your dividend usually around the second week.
We’re not even halfway through our dividend income list yet but I want to personally invite you to our private Facebook group, Let’s Talk Money Together. I love the group because it’s a great way for you in the community to have a conversation, talk about investing and making money.
Next is one of our two cell tower companies on the list, Crown Castle International, ticker CCI, and its 3% dividend yield.
CCI is a leader in the connectivity space with 40,000 cell towers, 70,000 small cell nodes and 75,000 miles of fiber cable. These assets are going to be vital as internet and smartphone bandwith demand booms over the next few years. Between the adoption of 5G, the Internet of Things where everything you own is connected to the net and the push to smart cities, this company owns the assets that will make it all happen.
Shares of Crown Castle go ex-dividend later this month, usually around the 26th of September.
I’m digging back into the value plays in utilities and here Sempra Energy, ticker SRE, and its 3.4% dividend yield.
Sempra owns utilities business in California and Texas, two of the largest markets for the sector, as well as some liquified natural gas infrastructure. California regulators have already approved the company’s four-year rate increases so this one should produce very stable cash flow for a while.
Sempra is one of the first to go ex-dividend in the list, usually towards the third week of September and paying out in early October.
Shares of Cisco Systems, ticker CSCO, and its 3.4% dividend haven’t rocketed like a lot of tech names this year but there’s still a lot to like.
Cisco dominates in networking equipment which is already seeing a boom on the shift to work-from-home. The company also has a strong position in cloud and enterprise services but what I’m really excited about is the May acquisition of ThousandEyes, a networking intelligence company. This could really boost Cisco’s cloud services line, basically it’s providing data intelligence on applications and online services to companies which is going to be a major trend for years.
Shares usually go ex-dividend in the first week of October, so still a few weeks on this one.
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Mega-bank JP Morgan, ticker JPM, and its 3.6% dividend yield could be the strongest bank in the market right now.
I like JP Morgan here because it’s got enough capital market business to support earnings and growth against the interest rate environment. Basically, because interest rates are so low, it’s really hard for lending banks to make money. JPM though books a lot of its revenue from trading fees and other market transactions like investment banking. It’s also the largest credit card issuer in the U.S. and has a strong capital cushion just in case loan defaults creep up.
Shares here go ex-dividend in that first week of October, right around the same time as Cisco.
We’ve got eight more dividend stocks to highlight and stick with me because these last two groups produce an average dividend yield of over 4%, more than twice the market yield.
I want to go through real quickly how I picked these stocks, how I put the portfolio together, so you can find your own dividend stocks or just adjust the portfolio when you need to.
Now the concept is easy but it took hours to put together the data on this. I took the 366 stocks in the S&P 500 that pay dividends, nearly 400 large-cap companies, I then went to the stock page for each one. You can find this on any investing platform but I went to Yahoo Finance and then to this Historical Data tab.
From here, I changed the time period and then to Show Dividends Only to see the dividend dates for the last five years. I took that and copied it into my spreadsheet for every single stock, noting the dividend dates over the last year.
Once I did that, I could note when each dividend stock paid out on each day and then could pick the best for our portfolio. For example, for today’s video, I 81 stocks going ex-dividend late September and into October.
This allowed me not only to create an income portfolio that pays out nearly every weekday of the month but also to select only the strongest companies with the highest dividend yields.
Next on our list is another cell tower REIT, American Tower, ticker AMT, with its 1.7% dividend payment.
Another one here with a less-than-impressive dividend yield but hiding some amazing growth. Shares have produced a 26% annual return over the last five years, well over the 15% annualized return on the overall market, and dividends have increased at a 20% clip each year.
AMT is by far the largest cell tower operator in the market with 180,000 towers and has a more diversified portfolio with assets across the U.S., Europe, Asia and Latin America. Those same market strengths we talked about with Crown Castle will work in American Tower’s favor as well and its scale really helps it cut costs.
Shares go ex-dividend late in the month here, usually around the 26th of September.
Media powerhouse Comcast, ticker CMCSA, and its 2% dividend are next here.
Comcast has been taking a lot of market share in internet services from the telecom providers like AT&T and Verizon. Just in the last five years, the company has grown its market share in the segment by about 8% to 64% of the market. The upside to this, besides higher revenue from the segment, is that Comcast can then upsell internet customers into its other products like cable and streaming.
The company has doubled its annual cash flows from the NBC segment since the 2011 acquisition and it’s just a generally really well-run company with a strong long-term outlook.
Shares go ex-dividend very early in October, usually on the first day of the month.
Back into healthcare here with the largest medical device company, Medtronic, ticker MDT, and its 2.2% dividend.
A lot of healthcare companies, especially medical devices, have actually had a rough year because of the coronavirus. Because any elective procedure or non-emergency has been pushed off, the company reported a 12% drop in revenue last quarter.
Of course, those procedures can be pushed back but most can’t be eliminated altogether so that could mean a big boost to the company’s sales over the next few quarters.
Medtronic is the largest pure-play medical device maker with competitive advantages in a range of chronic diseases including cardiac, diabetes and spinal conditions so this is definitely a strong company in that healthcare trend.
Shares usually go ex-dividend in the last week of September which means you’ll get the dividend towards mid-month October.
Next in our list, $3.9 billion leader in flow control systems, Flowserve, ticker FLS, and its 2.7% dividend yield.
Flowserve is a big name in the industrials segment though you might not have heard of it. The company is a leader in pumps, valves and other control systems in the oil & gas, chemical and power industries.
That exposure to oil & gas has meant the shares have been under pressure this year and are still 40% off the high but the company has a strong balance sheet. It’s got over $560 million in cash against about $1.5 billion in long-term debt which is pretty solid so the company has the financial survivability to rebound with the industrials market.
Flowserve goes ex-dividend in a few days here, one of the first on our list so be watching for that.
We’ve still got four more dividend stocks to highlight but I need to ask you for a favor. Nation, I’m trying to grow my Instagram profile, Let’s Talk Money Joseph Hogue, and I need your help. I use Instagram to share personal finance ideas, family updates and some great motivation so if you’re on the platform, look for Let’s Talk Money Joseph Hogue.
Four more stocks here, some with the highest dividends on the list and starting with a 3.6% dividend on shares of Patterson Companies, ticker PDCO.
Patterson is a products and equipment distributor to the dental and animal health markets, so another one here that has seen business hit by the pandemic but should see sales return later in the year. Against the weaker sales environment, the company has been able to manage costs to improve profitability.
Shares go ex-dividend later than most on the list, usually in the second week of October, so you’ll be receiving the dividend towards the end of the month.
Another tech powerhouse here with Broadcom, ticker AVGO, and a 3.6% dividend yield.
The 2016 merger of Avago Technologies and Broadcom created a monster in the semiconductor space. Avago brought its leadership in filters and amplifiers for high-end smartphones while Broadcom specialized in networking and broadband products. The combined company controls a leadership position in several of its segments and advantages in that scale.
This one goes ex-dividend pretty soon as well, usually around the 20th of September.
Two major dividend payers next, starting off with the 7% yield on shares of AT&T, ticker T.
Now I haven’t always loved AT&T but I’m starting to come around on where it’s trading now and recent moves by management.
Management has aggressively paid down debt though, paying off $11 billion last year, and the dividend is as safe as it gets. The dividend will be about 60% of earnings this year, so higher than previous years but there’s plenty of cash flow and savings from the paused share repurchase program.
Shares of AT&T go ex-dividend later on the list, around the second week of October.
Shares of Philip Morris International, ticker PM, offer a 5.9% dividend yield and very stable cash flow.
Shares are basically flat for the year and I don’t think the recent FDA announcement to allow IQOS to be marketed in the U.S. is built into the price. Tobacco volume is lower in most markets but the company has enough pricing power and other products that this one is going to be a cash machine for a very long time.
Shares go ex-dividend later this month, usually in that last week of September.
This dividend income strategy will create a dividend payment nearly every single day to pay the bills, build wealth or just to relax. Don’t forget to subscribe to the channel so you get notified when those other three videos come out. You don’t want to miss the rest of this awesome daily dividend portfolio!
Read the Entire Dividend Portfolio Series