Even the most promising names in your portfolio can get dragged down due to macroeconomic news or cyclical trends. During times like these, it helps to ride out the storm with the comfort of consistent dividend payments.
If you're an income investor constantly on the hunt for quality picks, you should consider the three stocks below. They're going ex-dividend in June, which means that if you buy these income-generating machines soon, you'll receive receive their next dividend payments
With all the chatter that the Federal Reserve will hike interest rates soon -- even after Friday's disappointing jobs report -- there is the potential that credit will become more expensive and affect sales of rate-sensitive products such as automobiles.
This won't help GM, which is already coping with dull growth in revenue. But GM sits on a cash pile that is far larger than those of automakers such as Tesla (TSLA - Get Report) . And that cash pile backs the company's dividends. On a trailing 12-month basis, GM has free cash flow of $2.96 billion while Tesla has a negative cash flow of a little more than $2 billion.
Moreover, at a payout ratio of 22%, GM still has plenty of room to expand its dividends.
GM is still the leader in trucks and is powered by a robust lineup of models. Even if its plans for automated cars face some delays, the company boasts strong fundamentals. Until the company's potential is reflected in its stock price, investors can enjoy the comfort of meaty dividend payments that currently yield about 5.1%.
Tougher gaming rules pertaining to China and the anticorruption crackdown in the country have adversely affected visits to the gaming mecca of Macau by VIPs. As a result, Macau, which is only location in China where gambling is legal, has been dealing with shrinking revenue for the past two years.
This has thus affected companies such as Las Vegas Sands, which has four resorts in Macau. Las Vegas Sands will see long-term success, however, because it has properties elsewhere. The company's Marina Bay Sands in Singapore is its most profitable property, and Las Vegas Sands is planning to expand it through the construction of a new tower of 1,000-1,200 rooms and an entertainment arena.
Although the stock is down around 16% over the last year, it's up 5.3% so far in 2016. Adding to the total return potential for investors is the current dividend yield of 6.2%. Analysts at Asian brokerage CLSA say that Las Vegas Sands' dividend is among the safest out there. In past, the company has grown its dividend at a fast pace, and the quarterly dividend is now more than double what it was in 2013. Las Vegas Sands will go ex-dividend on June 20.
Utility stocks are the classic income-producing defense plays, and Missouri-based public utility holding company Ameren is a fitting example.
Despite the bloodbath in the markets in the start of the year, Ameren stock has managed to gain 29% over the past year. It has also delivered nice dividends to shareholders. Even after the past year's gains, it still has an attractive dividend yield of 3.4%.
With a payout ratio of 70.6%, Ameren is still in a position to increase dividend payments in the future.
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