3 Supercharged Dividend Stocks to Buy If There's a Stock Market Sell-Off

Dividend stocks offer something for every type of investor. Whether you’re risk-averse or prefer a more aggressive style of putting your cash to work in the market, companies with a lengthy track record of paying and elevating their dividends in a variety of economic landscapes can improve your compounded returns over the years. 

3 Supercharged Dividend Stocks to Buy If There's a Stock Market Sell-Off

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3 Supercharged Dividend Stocks to Buy If There’s a Stock Market Sell-Off

If you’re on the hunt for more income stocks to boost your portfolio’s long-term growth potential, here are three names to consider hitting the buy button on. 


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1. Innovative Industrial Properties 

Innovative Industrial Properties (NYSE: IIPR) remains an increasingly unique example of a profitable business operating within the fast-growing cannabis space. The company is a real estate investment trust (REIT), and it owns and operates a portfolio of greenhouses and other facilities which it leases solely to state-licensed medical cannabis growers.

Innovative Industrial Properties’ portfolio includes locations in hot marijuana markets like Arizona, California, Illinois, Massachusetts, Nevada, Ohio, and Pennsylvania, with well-known tenants that include the likes of Green Thumb Industries, Jushi Holdings, Trulieve, and Cresco Labs. As a REIT, Innovative Industrial Properties is required to pay out no less than 90% of its taxable income as dividends. Its dividend payout surged 24% in 2022 alone, and the stock currently yields a whopping 8.4% for investors.  

As of Dec. 31, Innovative Industrial Properties owns a portfolio of 110 properties distributed across 19 states. The company enters into triple net lease arrangements with tenants, under which the latter is responsible for almost the entirety of operating costs attached to the properties in question. And the average length of a lease between Innovative Industrial Properties and a tenant is 15 years. These elements together have lent a strong measure of predictability and resilience to its business in an otherwise highly unpredictable and volatile industry.  

Looking at the full-year 2022, Innovative Industrial Properties reported revenue of $276 million, net income of $153 million, and adjusted funds from operations (FFO) of $234 million. These three figures represented respective increases of 35%, 36%, and 34% from the full-year 2021. Meanwhile, the company closed out the year with zero secured debt and cash on its balance sheet to the tune of about $87 million.

If you’re looking to invest in the potential of the multi-billion-dollar medical marijuana industry while putting your cash into a profitable and dividend-paying business to boot, Innovative Industrial Properties more than satisfies on all counts. 

2. Johnson & Johnson 

Johnson & Johnson (NYSE: JNJ) has an incredible track record of not only paying but raising its dividend. At the time of this writing, the company has 60 consecutive years of dividend increases under its belt. The stock yields approximately 3% at the time of this writing, and its dividend has increased by about 70% over the trailing decade alone.  

Johnson & Johnson is about to go through some major business changes with the spin-off of its consumer health business into a new company called Kenvue. The pharmaceutical and medical device businesses will be combined and remain under the Johnson & Johnson name. Both companies will pay dividends to shareholders.

The pharmaceutical and medical device businesses understandably remain the fastest-growing of Johnson & Johnson’s reportable segments, as the nature of the products they sell leads to far higher margins and profits. Still, the consumer health business has been a mainstay in households around the world for more than a century, and that broad industry footprint isn’t going anywhere.

On the whole, Johnson & Johnson remains profitable and growing revenue steadily (it reported earnings of $18 billion in 2022 while revenue jumped 1% from 2021 to $95 billion). For investors seeking a reliable, mainstay business that can deliver moderate growth in a wide range of environments, this looks like a worthwhile addition to a well-diversified portfolio.  

3. Microsoft 

Microsoft (NASDAQ: MSFT) is known for its market-leading software and hardware solutions, from its Office productivity software and its Azure cloud infrastructure services to its Windows operating system and popular products like the Xbox and Surface laptops and tablets. The tech giant has seen its dividend rise 200% over the trailing decade alone, and the stock currently yields about 1% for shareholders.  

While everyone from individuals to large enterprise customers is reeling back spending in the current economic environment, Microsoft’s industry-leading presence means that it’s well-positioned to benefit from a recovery in spending in the future. Even in the challenging landscape that tech companies are navigating right now, the company is growing revenue steadily and raking in profits. 

Microsoft reported total revenue of $53 billion in the most recent quarter, along with earnings of $16 billion. That top-line figure represented an increase of 2% from the year-ago quarter. And if anyone was concerned, Microsoft has plenty of liquidity on hand to weather any near-term storms — nearly $100 billion in cash and investments as of last count. The company’s established digital and physical products, not to mention its role in the artificial intelligence revolution, make its faithful dividend history the icing on the cake of this tried-and-true stock.  


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Rachel Warren has positions in Johnson & Johnson. The Motley Fool has positions in and recommends Cresco Labs, Green Thumb Industries, Innovative Industrial Properties, Jushi, Microsoft, and Trulieve Cannabis. The Motley Fool recommends Johnson & Johnson. The Motley Fool has a disclosure policy.

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