Double your money in a short period of time. Few investors would walk away from such an opportunity. Of course, there is no guarantee that your investment will double your money. Risk is closely tied to potential reward.
However, achieving 100% return within the next 6.5 years is not beyond the realm of possibility. Here are three super high dividend stocks that can realistically deliver 100% total return by 2030.
1. Ares Capital
ares capital (NASDAQ:ARCC) is the largest publicly traded business development company (BDC). The company provides financing to companies with a particular focus on the upper echelons of the middle market.
BDCs are required to return at least 90% of their profits to shareholders in the form of dividends. Ares Capital has generated significant profits that can be returned to investors. The dividend yield is close to 9.6%. The company's dividend is also reliable, having grown steadily over 14 years.
This stock will generate a return of over 80% in dividends alone by the end of 2030, even if the stock price does not rise. But if history is any guide, Ares Capital should provide investors with significant stock price appreciation in addition to generous dividends. The company's total profit is S&P500 In the long run.
Ares Capital meets the financing needs of a growing market. Many banks are shying away from the middle market, leaving a wide opportunity for BDCs to provide private capital. With Ares' impressive track record, strong financial position, and impressive dividend, we think this stock has a good chance of doubling investors' money by 2030.
2. Enterprise Product Partner
enterprise product partner (New York Stock Exchange: EPD) is a limited partnership (LP) that owns midstream energy assets. These assets include more than 50,000 miles of pipelines, 40 natural gas processing plants, 26 fractionation towers, and more.
Midstream Energy LPs are known for rewarding investors handsomely with attractive distributions. Enterprise Products Partners is no exception. Its distribution rate is almost 7.2%. The company has also increased its distribution for 25 consecutive years.
These distributions should go a long way in helping Enterprise Product Partners achieve more than 100% total return by 2030. However, don't discount the outlook for the stock to do well.
Demand for natural gas and natural gas liquids should increase in the coming years. This should increase demand for Enterprise Products Partners' pipelines and midstream facilities, especially since the U.S. ranks as the largest exporter of liquefied natural gas.
3. Pfizer
pfizer (New York Stock Exchange: PFE) It is the most well-known of these three stocks. The company is one of the largest pharmaceutical companies in the world. We sell a wide range of products including autoimmune disease drugs, cancer treatment drugs, and vaccines.
My definition of a super high dividend stock is one with a dividend yield that is at least four times the S&P 500's dividend yield. Pfizer's nearly 6.1% dividend yield meets that criteria.
Like Ares Capital and Enterprise Products Partners, Pfizer doesn't need to generate massive stock appreciation to double investors' money by 2030, thanks to its attractive dividend. With sales of COVID-19-related products declining and patents on some of its best-selling drugs looming, some may worry that the company won't be able to achieve significant growth at all.
However, I expect Pfizer's COVID-19 revenue to be stable. The company expects to generate $20 billion in additional annual revenue by 2030 from new product launches and new indications for existing products. That's more than enough to offset revenue losses from the looming patent cliff. Pfizer also expects to generate an additional $25 billion in new revenue from business development deals by 2030.
All of this leads to reliable growth. Combined with the dividend, I think this growth could easily allow Pfizer to generate a 100% total return over the next six and a half years.
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Keith Speights works at Ares Capital, Enterprise Products Partners, and Pfizer. The Motley Fool has a position in and recommends Pfizer. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.
3 Super Dividend Stocks That Can Realistically Double Your Money By 2030 was originally published by The Motley Fool.
