Here are 3 dividend stocks to buy for a passive income

first_img I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. See all posts by Rupert Hargreaves The Motley Fool UK’s Top Income Stock… Rupert Hargreaves owns shares in British American Tobacco. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Simply click below to discover how you can take advantage of this. Enter Your Email Address I think owning stocks and shares is one of the most straightforward ways of generating a passive income. As such, I’m always on the lookout for dividend stocks to add to my portfolio. Here are three such companies I would buy to generate a passive income.Income stocksThe first company on my list is water supplier United Utilities (LSE: UU). This firm has become an income champion thanks to its steady revenue stream.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…As consumers will always need access to fresh water, I think the business will always generate a steady stream of profits, a percentage of which can be returned to investors. At the time of writing, the stock supports a dividend yield of 4.3%. It also has a long track record of increasing its dividend in line with inflation.That’s why I would buy the company for my portfolio of passive income investments.However, the company also faces some risks, which could impact its dividend credentials. These include the threat of regulation and higher costs. If Ofwat decides to reduce the amount of profit United Utilities is allowed to earn, the group’s profits could fall. This may force management to reduce the dividend. Passive incomeAnother company on my list of income stocks to buy is cigarette producer British American Tobacco (LSE: BATS). At the time of writing, this stock offers a dividend yield of 7.7%.This market-beating yield reflects the risks facing the business. For example, smoking is a well-known cause of cancer, and governments worldwide are always trying to think of new ways to reduce consumption.It may only be a matter of time before outright bans are introduced in some of the company’s largest markets. This could have a devastating impact on its profitability. Management would almost certainly cut the dividend in this scenario. However, we’ve known about the risks of smoking for decades. So far, this has had a limited impact on tobacco consumption. Indeed, a recent report suggests cigarette consumption is at an all-time high. Therefore, I would buy the company for my portfolio of income stocks, although I’m aware not all investors may be comfortable owning a tobacco producer. FTSE 100 income championThe final company I would buy for my portfolio is Legal & General (LSE: LGEN). I think this passive income champion has similar qualities to United Utilities. The financial giant manages pension and life insurance policies for millions of people.As such, it has to operate conservatively and not take excessive risks. These products also generate a steady stream of revenues and profits for the group. I think this stream of profits can support the group’s 6.1% dividend yield. That’s why I would buy the stock today. That sais, a critical risk facing the business is the possibility of another financial crisis. In the last financial crisis, the company had to slash its dividend as it took heavy losses. Unfortunately, there’s no guarantee the same won’t happen again.  Here are 3 dividend stocks to buy for a passive incomecenter_img Image source: Getty Images Learn how you can grab this ‘Top Income Stock’ Report now Our 6 ‘Best Buys Now’ Shares Rupert Hargreaves | Sunday, 30th May, 2021 | More on: BATS LGEN UU We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign.But with this opportunity it could get even better.Still only 55 years old, he sees the chance for a new “Uber-style” technology.And this is not a tiny tech startup full of empty promises.This extraordinary company is already one of the largest in its industry.Last year, revenues hit a whopping £1.132 billion.The board recently announced a 10% dividend hike.And it has been a superb Motley Fool income pick for 9 years running!But even so, we believe there could still be huge upside ahead.Clearly, this company’s founder and CEO agrees. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee.last_img

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