3 High-Yield Dividend Stocks to Buy and Hold Forever

Dividends offer investors an incredible strategy for building long-term wealth, especially when those dividends are reinvested. Not only do the following stocks all offer dividend yields above 5%, they all have their own reasons to be held forever. Let’s dig in.

Warm up

Global renewable energy is on fire right now, in a good way. Global annual renewable capacity expansion will increase by nearly 50% by 2023, marking the fastest growth rate in the past two decades. It was also the 22nd year in a row that renewable capacity expansion set a new record – a trend that investors can get behind.

Those statistics leave a company as Clearway energy (CWEN 1.60%) will benefit from this in the coming years as renewable energy continues to grow. Clearway Energy is one of the largest owners of clean energy generation assets in the U.S. market and its fleet includes roughly 9,000 MW of net generating capacity in 26 states. These assets include wind energy, solar energy, energy storage assets and environmentally friendly natural gas generation facilities.

Not only does the Federal Reserve’s interest rate cut ensure that Clearway can affordably finance acquisitions, the company also has several investments in sustainable energy projects in the pipeline. The company also offers incredible transparency around its dividend, which currently offers a 5.5% yield, with targeted growth of 5% to 8% through 2026 and a payout ratio between 80% and 85%.

As renewable energy continues to grow, Clearway is a stock you can hold forever while reinvesting its robust dividend.

Acquisition and 5G

Verizon Communications (VZ 0.60%) is the largest American telecommunications company in terms of turnover and the company lives mainly from internet and telephone subscriptions and the sale of equipment. But a recent move is bringing something more into the fold.

In early September, Verizon announced that it had entered into an acquisition agreement Border in an all-cash transaction worth $20 billion. It’s a strategic move that will land one of the largest pure-play fiber internet providers and significantly expand Verizon’s fiber footprint. The acquisition will also increase scale by 2.2 million fiber subscribers, and management believes this can generate at least $500 million in annual run-rate cost synergies.

However, the reason why investors can hold Verizon forever has more to do with its work in 5G. The barriers to entry in the industry are so high that Verizon will likely remain one of only three companies with a nationwide 5G network.

Verizon recently increased its dividend, marking the 18th consecutive year that the company’s board of directors approved a quarterly dividend increase. Currently, Verizon’s dividend yield is at a juicy 6%, and with the acquisition and work with 5G, the company could be held forever.

EV woes

Ford Motor Company‘S (F 0.94%) The advantage is almost addition by subtraction. While the Ford Blue and Ford Pro divisions are busy squeezing profits, Ford’s Model E unit, responsible for electric vehicles, is doing the opposite and is expected to lose up to $5.5 billion by 2024 alone .

However, the iconic automaker is not letting losses mount and has postponed as much as $12 billion in EV investments. Management spent 40% of capital expenditure on electric vehicles, but that has been reduced to 30%. Ford has canceled a series of EV SUVs, minimized plans for a battery factory and attacked the cost structure of its EVs with a “skunkworks” team that aims to develop a low-cost platform with prices around $25,000.

The auto industry’s transition to an electric vehicle future is slower than expected, and losses could drag on for longer than investors would like. But if Ford eventually even breaks even on its model e division, it will be a huge boost to its bottom line and its ability to grow dividends in the future.

The auto industry is cyclical and also experiencing an EV revolution, and investors would be wise to hold a stock like Ford for the long term as it works through headwinds and makes up for EV losses. At current prices, Ford’s dividend yields 5.7%, often offering investors additional dividends if it has extra cash.

Buy and hold

These three stocks offer investors a way to capitalize on the booming renewable energy sector, have limited access to the future of 5G, and make profits as automakers cut electric vehicle prices. All three companies offer dividend yields above 5%, and they are certainly stocks you can hold forever.