In a period of rising inflation և during a period of slowing economic growth, investors can rely on the reliability of dividend stocks to consider them.

Earlier this year, Hartford Funds asset managers released a report showing benchmark performance. S&P 500: with dividends, without it, until 1930. It found that dividend-paying stocks contributed 41% to the overall return to that 90-year period.

In addition to the wars and downturns, the period included the so-called “lost decade” of the 2000s, when the bursting of the tech stock bubble, the 9/11, and the collapse of the housing market led to negative earnings for the S&P 500. . Shares, however, returned positively 1.8%.

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The study also found that since 1970, dividends have accounted for a staggering 84% of the index’s total return. The repurchase of dividends in the benchmark, as well as the strength of the merger, would increase the investment of $ 10,000 to more than $ 3.8 million, compared to $ 627,161, the chart of which should have been based on the price of the index alone.

While you may be convinced that buying dividend-paying stocks is a proven, lucrative strategy for generating high-quality long-term returns, obviously the next question is:

Pursuing direct returns is risky because higher returns are often more risky, but whether you are a growing or a valuable investor, there is a return on income that can fit into any portfolio. The following pair of dividend stocks happen to be not only solid income stocks, but also benefit from being dirty cheap.

Annaly Capital Management:

Real Estate Mortgage Investments (REIT) at the Largest Market Value Annaly Capital Management: (NYSE: NLY) is also the principal of mREIT, which invests in mortgage-backed securities, usually secured by the full trust of the federal government through credit agencies, including Fanny May and Freddie McInny May. As of the end of June, they represent 99% of its mortgage portfolio.

The goal of Annaly և other mREITs is to maximize the difference between the average return on their mortgage securities and the amount paid to borrow money. This means that one of their biggest risks is the easy-to-use Federal Reserve policy, which keeps interest rates artificially low and pushes homeowners to refinance their higher-interest mortgages for lower interest rates.

This is why Annaly is experiencing an increase in the fixed rate of advance payment (CPR), or the percentage of its portfolio that it expects to repay within a year. In the second quarter, its CPR increased to 26.4% from 23.9% in the first quarter. Although it expects its long-term CPR to be 12.9%, better than the 18% forecast a year ago, it is still up from the 11.8% expected by Anal two months ago.

Fortunately, given the economic outlook, the Federal Reserve is not going to make any policy changes that would drastically disrupt the apple cart.

Annaly shares are down 10% from their recent highs, but it is trading 4 times with a downward return և 8 times according to analysts. Its dividend now stands at 10% per annum, just where it has averaged over the past two decades, a period when mREIT returned about $ 20 billion in dividends to shareholders.

A prescription bottle that pours pills on $ 100 bills.

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Viatris

It was formed in November last year by merging the $ 12 billion drug business Pfizer:s Upjohn Division և General Pharmacist Mylan, Viatris (NASDAQ: VTRS) It does this by building on the best of both worlds. The market, however, is concerned about its ability to make a profit while incurring significant debt.

Viatris has suffered significant losses since its shutdown, but the company predicts that a quarter of its outstanding debt will be repaid by 2023. At that time, he expects to achieve $ 1 billion in spending synergy, or double the amount he expected this year.

On an adjusted basis, it generated $ 2.3 billion in net income, more than double that of a year ago.

After the debt reduction, the management of Viatris would like to invest several years of operating funds in the development of new research. This should give it greater financial flexibility, which will allow it to provide biotechnology to its shareholders in the future, either through the repurchase of its own shares, the elimination of dividends or the launch of an in-house drug development program.

Viatris is also in a great position to take advantage of the aging global population of the United States through its leading overall distribution, as the industry is growing at almost 6% per year, from $ 172 billion a year ago to 2026. Administration Approval of Semglee, Insulin Medication for Diabetes և the First Biologically Mutable Similar in the US

Viatris trades at 4 times less revenue estimates, with a cash flow of about 80% of its carrying amount, և 10 times the amount of cash produced. The dividend he started after his spinoff is 3.2% per annum, which allows investors to buy this dirty cheap biotechnology before it opens up the value inherent in his business.

This article presents the opinion of a writer who may disagree with the position of the “official” offer of Motley Fool Premium Consulting. We are motley! Questioning an investment thesis, even our own, helps all of us think critically about investing, making decisions that will help us become smarter, happier, and richer.