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High-yield dividend stocks might be the best option for savers in 2020.
Today, U.S. Federal Reserve members will discuss monetary policy and the outlook for interest rates in the coming year. But we already know what they're going to say.
So let me save you a little bit of time…
Interest rates will remain lower for longer. And you can expect further cuts if the economy gets bumpy.
We know this because lower interest rates were the Fed's favorite weapon in its ongoing war on savers.
To be fair, fixed-income investors haven't been able to rely on interest rates for most of the decade anyway. With 2020 underway, it looks like investors are stuck finding other ways to live off their nest egg.
Today, I'm digging into three of my top high-yield dividend stocks right now. That includes what I think is one of the best dividend stocks in 2020. It combines a 5%-plus dividend with significant upside over the next 12 months.
Plus, this first dividend stock plans increase its dividend by 79% each year…
This Stock Pays $1 Per Share
Lower interest rates and ongoing political tensions have been a boon for gold prices. And with gold breaking out of a multiyear holding pattern, gold stocks have once again pushed to recent highs. This has been good for Newmont Corp. (NYSE: NEM).
So this week, the company used the recent uptick as a tool to recruit new investors. The firm announced a plan to increase its dividend by 79% to $1 per share each year.
The firm also plans to boost its share repurchase plan for up to $1 billion in common stock. In 2019, Newmont returned about $1.4 billion to shareholders. In 2020, it will try to increase those allocations, particularly if gold prices continue to climb.
Now, let's pivot to one of the best dividend stocks from last year – it's also ready for a big 2020.
Microsoft Dividend Hike Coming Soon
Microsoft Corp. (NASDAQ: MSFT) emerged as one of the top stocks of 2019. Shares popped more than 54%, nearly doubling the return of the S&P 500 for the year.
The firm has emerged itself in the cash-rich industries of cloud computing and software subscriptions. The uptick in share price naturally impacted the company's dividend.
Over the year, its dividend yield fell from 1.7% to 1.2% since share prices soared. But don't expect it to stay down at 1.2% for very long.
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Markets largely expect that Microsoft will announce a dividend hike during its upcoming earnings report. Over the last five years, MSFT has increased its dividend from $0.31 per quarter to $0.51. Given its 9.5% hike in 2018 and its 11% hike last year, investors could easily see another double-digit percentage increase this year.
Now, our top dividend stock has the highest yield of these, over 5%. But it's also a growth opportunity…
This High-Yield Dividend Stock Could Jump 45%
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.