Listen up, my fellow income investors! The stock market has been a rollercoaster lately, and the tech wreck is making a lot of folks nervous. But let me tell you, this pullback is creating an opportunity. That’s because the Fed is getting ready to cut interest rates, and THAT’s going to be a game-changer for a select group of small-cap dividend stocks!
You see, small companies are more sensitive to interest rate changes than their larger counterparts. When rates are high, it costs them more to borrow money, which can squeeze their profits. But when rates fall? It’s like a shot of adrenaline! They can suddenly expand, invest in new projects, and boost their bottom line… leading to explosive growth (and bigger dividend payments!).
So, today I’m giving you a watchlist of 3 small-cap dividend payers that are primed to benefit when rates come down! These companies have solid fundamentals, strong dividend growth track records, and they’re flying way under the radar of Wall Street.
1. Stag Industrial (NYSE: STAG) – Dividend Yield: 3.6%
You might remember Stag Industrial from our Monthly Dividend Stocks roundup. This industrial REIT focuses on single-tenant properties, which means they’re collecting rent from just one company per building. Sounds risky? It’s actually a recipe for stability! These long-term leases create a predictable income stream, which is exactly what we want in today’s uncertain market.
Sure, STAG’s dividend yield of 3.6% might not seem thrilling at first glance. But here’s the thing: Stag just blew past earnings expectations and raised its dividend for the 12th consecutive year! As my colleague, Bob Ciura of Sure Dividend, pointed out, “STAG has generated strong growth since the coronavirus pandemic ended.” (Read Bob's full analysis here!)
2. Invitation Homes (NYSE: INVH) – Dividend Yield: 3.0%
Invitation Homes is the king of the single-family rental market. They own over 80,000 homes across the U.S., and demand for rentals is going through the roof! As more people get priced out of the housing market, Invitation Homes is sitting pretty.
Now, I know what you’re thinking: “3.0% yield? That’s barely keeping up with inflation!” But what’s really exciting — as my sources at U.S. News pointed out — is Invitation Homes’ strategic move into property management. This means they can generate additional revenue without taking on more debt, potentially leading to even bigger dividend payouts! (Read more about Invitation Homes here…)
3. Kimco Realty (NYSE: KIM) – Dividend Yield: 4.1%
Kimco Realty operates those shopping centers you see in every town across America. And while you might think the “retail apocalypse” is killing brick-and-mortar stores, Kimco is proving the doubters wrong! They’ve got a knack for picking great locations with thriving tenants, and they’re seeing booming occupancy rates!
U.S. News is bullish on Kimco, noting their impressive occupancy rates. Plus, those leases are being renewed at higher rates, which means even more cash flow for dividends! (Read more here about the full story here)
Don’t Miss This Opportunity!
These small-cap dividend payers are flying under the radar, but that’s going to change when the Fed starts lowering interest rates! Now is your chance to get in before the masses and lock in those juicy yields!
Tomorrow, we’re going to explore a UNIQUE income investing strategy with the potential for 10% tax-FREE yields! It’s an opportunity most financial advisors “don’t want you to know about”… so don’t miss it!
