5 Top Dividend Stocks Yielding 5%+ to Buy in June

Rising interest rates have put a lot of pressure on dividend-paying stocks over the past year. Higher rates make lower-risk income investments like bonds and bank CDs more attractive. That weighs on the share prices of dividend payers, driving up their yields to compensate investors for their higher risk profiles.

As a result, investors can now lock in some very attractive dividend yields on some high-quality payers. Clearway Energy (NYSE:CWEN)(NYSE:CWEN-A), Kinder Morgan (NYSE:KMI), Verizon (NYSE:VZ), W. P. Carey (NYSE:WPC), and Walgreens Alliance Boots (NASDAQ:WBA) all offer yields above 5% these days. That makes them great stocks for income-focused investors to buy this June.

A fully powered dividend growth forecast

Clearway Energy currently yields more than 5%. The clean energy infrastructure company backs that payment with steady cash flow supported by long-term, fixed-rate contracts with utilities and corporate buyers of power from its renewable energy and natural gas generating facilities.

The company expects to grow its high-yielding payout toward the upper end of its 5% to 8% annual target range through 2026. It has already secured the investments and funding underpinning that plan. Clearway sold its thermal assets for $1.35 billion in net proceeds last year and is deploying that capital into higher returning renewable energy projects that it will acquire through next year as they enter commercial service. Those investments will support its dividend growth for the next several years.

A substantial and sustainable payout

Kinder Morgan's dividend is around 7%. The natural gas pipeline giant backs that payout with very stable cash flow supported by long-term contracts and government-regulated rate structures. The company pays out slightly more than half its stable cash flow to support the dividend, retaining the rest to invest in expansion projects, repurchase shares, and maintain a strong financial profile. Kinder Morgan has increased its payout for six straight years, including by 2% this year. The company should be able to continue delivering modest dividend growth, supported by its stable and rising cash flows.

A cash flow machine

Verizon offers a dividend yield of more than 7%. The telecom giant generates plenty of cash to cover its payout. In 2022, it produced $3.3 billion of excess free cash flow after covering its capital program and dividend payment. Meanwhile, free cash should rise in the future because the company recently finished funding a key growth investment. That should enable Verizon to continue increasing its dividend. It delivered its 16th straight year of dividend growth last year, the longest current streak in the U.S. telecom sector.

A milestone year

W. P. Carey's dividend is above 6%. The diversified REIT generates very stable and growing rental income backed by long-term triple net leases (NNN) that escalate annually at a fixed rate or one tied to inflation. Rising rents and income-producing property acquisitions have enabled W. P. Carey to steadily increase its dividend. It has given its investors a raise every year since 1998, putting it on track to reach the quarter-century mark this year.

Working toward joining a very elite group

Walgreens Alliance Boots also yields more than 6%. The integrated healthcare, pharmacy, and retail company has paid dividends for over 90 years and increased the payout for the last 47 consecutive years. That has it closing in on joining the super-elite group of Dividend Kings, companies with 50 or more years of consistent dividend growth.

The company is in the process of building its next growth engine with consumer-centric healthcare solutions. It has invested billions of dollars to grow this platform, which will help reaccelerate its earnings, enabling it to continue increasing the dividend.

High-quality, high-yielding dividend stocks

Clearway Energy, Kinder Morgan, Verizon, W. P. Carey, and Walgreens all pay dividends yields above 5%. Even better, they should be able to continue growing their already attractive payouts in the coming years. That makes them ideal stocks for income-seeking investors to buy this month.

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Matthew DiLallo has positions in Clearway Energy, Kinder Morgan, Verizon Communications, and W. P. Carey. The Motley Fool has positions in and recommends Kinder Morgan. The Motley Fool recommends Verizon Communications and W. P. Carey. The Motley Fool has a disclosure policy.