Bank of America (BAC)
Let’s start with a bank stock. Why? While many sectors fear rising interest rates, banks look forward to them.
Central banks hike interest rates to tame inflation.
Banks lend money at higher rates than they borrow, pocketing the difference. When interest rates increase, the spread for how much a bank earns widens.
And it just so happens that quite a few banks, such as Bank of America, have upped their payouts to shareholders over the past year.
In July, Bank of America boosted its quarterly dividend 17% to 21 cents per share. That gives the company an annual yield of 1.8% at the current share price.
According to the latest earnings report, the bank earned a profit of $7.0 billion in Q4, up 28% from a year ago.
Even with the stock market’s sluggish start in 2022, Bank of America shares have climbed 30% over the past 12 months. Its peers, such as Goldman Sachs and Morgan Stanley — both of which raised their dividend in 2021 — have also enjoyed substantial rallies during this period.
Discover how a simple decision today could lead to an extra $1.3 million in retirement
Learn how you can set yourself up for a more prosperous future by exploring why so many people who work with financial advisors retire with more wealth.
Discover the full story and see how you could be on the path to an extra $1.3 million in retirement.
Read MoreSouthern Co. (SO)
Moving up the yield ladder is Southern, a gas and electric utility holding company headquartered in Atlanta. It serves close to 9 million customers.
The utility sector is known for being a defensive play — and not just against inflation. Come what may, people still need to heat their homes in the winter and turn the lights on at night.
The recession-proof nature of the business means Southern can pay reliable dividends.
In April, the company boosted its quarterly payout by 2 cents per share to 66 cents per share, marking the 20th consecutive year that Southern has increased its dividend.
Look further back, and you’ll see that the company has paid steady or increasing dividends since 1948.
In 2021, Southern earned an adjusted profit of $3.41 per share, up 5% from 2020. Management expects adjusted earnings per share for 2022 to be in the range of $3.50 to $3.60.
Trading at $64 apiece, Southern stock offers a solid annual yield of 4.1%.
Global Partners (GLP)
If you really want oversized yields, you may have to look at the lesser-known stocks — like Global Partners.
Structured as a master limited partnership, Global Partners is one of the largest independent owners, suppliers and operators of gas stations and convenience stores in the Northeast.
At the same time, it is a leading wholesale distributor of fuel products and is involved in transporting petroleum products and renewable fuels by rail from the mid-continental U.S. and Canada.
The business pays quarterly distributions of 58.5 cents per unit, which comes out to a staggering annual yield of 9.1%.
In the trailing 12 months as of Sept. 30, Global Partners’ distributable cash flow covered its payout 1.1 times after factoring in distributions to its preferred unitholders.
The partnership will report Q4 results on Monday, Feb. 28 before the markets open.
Sign up for our Moneywise newsletter to receive a steady flow of actionable ideas from Wall Street's top firms.
Diversify your portfolio by investing in art
When it comes to investing, a diversified portfolio can lead to better returns. Masterworks' art investing platform has turned a previously inaccessible asset class into an actual option for individual investors. Think of artists like Banksy, Monet or Warhol. Get priority access and skip the waitlist here.
Skip the waitlistMore from Moneywise
- 4 Ways to Earn Big Returns in 2022 Without the Shaky Stock Market
- Jim Rogers: Next Bear Market Will Be ‘Worst in My Lifetime’ — He'll Rely on 3 Assets
- Robert Kiyosaki Says We're Already in a 'Technical Depression' — He's Using These 3 Assets for Protection
This 2 minute move could knock $500/year off your car insurance in 2024
OfficialCarInsurance.com lets you compare quotes from trusted brands, such as Progressive, Allstate and GEICO to make sure you're getting the best deal.
You can switch to a more affordable auto insurance option in 2 minutes by providing some information about yourself and your vehicle and choosing from their tailor-made results. Find offers as low as $29 a month.
