When you are on a budget, sometimes you have to compromise with the products you buy. Maybe you eat fast food instead of going to a more expensive restaurant. You may buy second-hand furniture instead of new furniture.
But such compromises are not necessary in investing. Even if you don’t have a lot of money, you can find great stocks, many of which offer exceptional dividends. Here are my picks for the smartest dividend stocks to buy right now for $150.
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You can scoop up two shares of it Ares Capital (NASDAQ: ARCC) for less than $44. And with this stock you get a lot of bang for your buck.
Ares Capital is a top business development firm (BDC). It provides financing to mid-market companies, which typically generate annual revenues between $100 million and $3 billion.
As a BDC, Ares must return at least 90% of its income to shareholders through dividends to be exempt from income taxes on its profits. The company has paid stable or growing dividends for fifteen consecutive years. The future dividend yield currently stands at a shy 9%.
Ares Capital has generated the highest total returns and dividend growth of any major publicly traded BDC over the past decade. Since its inception in 2004, the company’s cumulative total return has surpassed 1,000%, compared to approximately 674% for the S&P500.
You can’t buy two shares Enbridge (NYSE: ENB) with another $45 off your original $150, but you can buy one. If you do this, you will become part owner of one of North America’s top midstream energy companies.
However, Enbridge is more than just a midstream energy company today. It still operates pipelines and natural gas storage facilities in the US and Canada. But thanks to recent acquisitions, the company is now also the largest natural gas company in North America and is expanding its renewable energy business.
What about dividends? Enbridge has increased its dividend for 29 consecutive years. The forward dividend yield stands at a lofty 6.2%.
Investors should also be able to count on stable dividends from Enbridge in the future. About 98% of the company’s cash flows are contractually tied or part of cost-of-service agreements that reduce volatility. Enbridge has minimal exposure to commodity price fluctuations. This excellent dividend payer is well positioned to succeed in both rising and falling markets.
After purchasing two shares of Ares Capital and one share of Enbridge, you will be left with more than $60 of your original $150. That’s enough to collect one part Real estate income (NYSE:O)the seventh largest global real estate investment trust (REIT).
