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AT&T (T)

We pay our cell phone bills and Internet bills every month. If you want to get even, consider collecting dividends from companies that provide these services.

AT&T, for instance, is one of the largest telecommunications companies in the world. More than 100 million consumers in the U.S. use its mobile and broadband services. At the same time, the company also serves nearly all Fortune 1000 companies with connectivity and smart solutions.

And because wireless and Internet services are necessities for the modern economy, AT&T generates a recurring business through thick and thin.

The company pays quarterly dividends of 27.75 cents per share, translating to an annual yield of 5.9%.

Raymond James analyst Frank Louthan has a ‘strong buy’ rating on AT&T and a price target of $24. Considering that AT&T shares currently trade at around $18.90 a piece, the price target implies a potential upside of 27%.

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Realty Income (O)

Realty Income is a real estate investment trust with a portfolio of over 11,700 properties that are under long-term lease agreements.

Its top tenants include big names like Walmart, CVS Pharmacy, and Walgreens — companies that have survived and thrived through thick and thin.

In fact, the REIT claims that it collects around 43% of its total rent from investment-grade tenants. A diversified, high-quality tenant base allows Realty Income to pay reliable dividends.

Moreover, while most dividend-paying companies follow a quarterly distribution schedule, Realty Income pays its shareholders every month.

The stock currently yields 4.6%.

Morgan Stanley analyst Ronald Kamdem has an ‘overweight’ rating on Realty Income and a price target of $74 — roughly 13% above the current levels.

MPLX (MPLX)

MPLX isn’t a household name like AT&T. But for the serious yield-hunters, it’s a stock that probably shouldn’t be ignored.

Headquartered in Findlay, Ohio, MPLX is a master limited partnership created by Marathon Petroleum to own, operate, develop and acquire midstream energy infrastructure assets.

The partnership pays quarterly cash distributions of 77.50 cents per unit. With the stock trading at $33.73, that translates into a chunky annual dividend yield of 9.2%.

In Q3, MPLX generated $1.26 billion of distributable cash flow, which provided 1.58 times coverage for its cash distributions for the quarter.

The stock is also up 12.8% year to date, in stark contrast with the S&P 500’s double-digit loss during the same period.

Wells Fargo analyst Michael Blum sees further upside on the horizon. Blum has an ‘overweight’ rating on MPLX and a price target of $40, about 19% worth of upside from where the stock sits today.

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Jing Pan Investment Reporter

Jing is an investment reporter for MoneyWise. He is an avid advocate of investing for passive income. Despite the ups and downs he’s been through with the markets, Jing believes that you can generate a steadily increasing income stream by investing in high quality companies.

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