The Smartest Dividend Stocks to Buy With $100 Right Now

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A little money can go a long way, especially when you’re investing in stocks that pay you to own them.

I mean dividend stocks, of course. There are plenty of great dividend stocks that don’t cost much. Here are my picks for the smartest dividend stocks to buy right now.

You can collect a share Ares Capital (NASDAQ: ARCC) at its current price of around $23.I think doing so could be one of the best investments you can make, especially if you’re looking for income.

Ares Capital’s forward dividend yield is 8.4%.Why is Ares Capital’s yield so high? business development company (BDC). To be exempt from federal income tax, BDCs must return at least 90% of their profits to shareholders as dividends.And this one generates big returns for its shareholders.

The main reason is the nature of the company’s business. Demand for direct lending offered by BDCs is growing due to several factors, including the speed of closing deals and reliable access to capital during volatile periods for the market with annual revenues between $100 million and $1 billion.It jumps to $5.4 trillion if those with annual revenues over $1 billion are included the companies.

In addition, Ares Capital is head and shoulders above its peers. It is the largest public BDC and has a deep relationship in the market. It has also posted higher dividend growth and total earnings than its leading competitors. :

Another $34 or more will buy you a share Enterprise Products Partners: (NYSE: EPD ). Technically, you’ll get a midstream energy leader unit rather than a share because it is limited partnership (LP). Investing in LPs comes with some tax complications, but I think Enterprise Products Partners is worth the extra work.

The company’s forward distribution yield recently topped 6.35%.Want more good news?LP has increased its distribution for 26 consecutive years.

I like that Enterprise Products Partners’ business is doing well in recessionary and turbulent times. It’s not affected by inflation because about 90% of its long-term contracts contain price growth clauses. Neither is Enterprise’s cash flow decrease in fluctuations in oil and gas prices; it charges the same amount to use its pipelines, regardless of commodity prices.

These aren’t the only reasons why Enterprise is a smart investment right now. Its valuation is attractive, with forward earnings of 11.6. I also think a second Trump administration will implement favorable policies for midstream companies like Enterprise. the

After investing in Ares Capital and Enterprise Products Partners, you should have $43 left over from your initial $100.That’s more than enough to buy one stock Pfizer: (NYSE: PFE)which is currently trading below $27 per share.

Pfizer’s current forward dividend yield of 6.5% is near a 15-year high.The drugmaker’s dividend also appears safe. management has consistently placed dividend maintenance and growth as the company’s capital allocation priority.

Granted, some may wonder if buying Pfizer is such a smart idea. Several of the company’s drugs will lose patent protection over the next few years. Pfizer also estimates a $1 billion negative impact on its earnings this year from the law on

However, I like Pfizer’s outlook for the second half of the decade. It has many new products to drive growth and a promising late-stage pipeline. Since the stock is trading at 9x earnings, the stock is also dirt cheap.

Before you buy shares in Ares Capital, consider this:

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Think about when Nvidia: compiled this list on April 15, 2005… if you invested $1000 at the time of our offer, you would have $843,960!*

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Keith Speights has positions in Ares Capital, Enterprise Products Partners and Pfizer The Motley Fool recommends Enterprise Products Partners a disclosure policy.

The Smartest Dividend Stocks to Buy for $100 Right Now originally published by The Motley Fool

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