Dividends4Life: A Safe 10.1% Yield

Dividend Growth Stocks News

A Safe 10.1% Yield

Posted by D4L | Thursday, August 09, 2018 | | 0 comments »

Today’s chart highlights another winner from a graying America. Longtime readers have heard our bull case for healthcare stocks before. As the population gets older, we’ll need more tests, drugs, and doctors. That’s great news for investors, because more demand for healthcare services has resulted in a bonanza of dividend increases. You can also see the trend reflected in the soaring price of healthcare stocks like Johnson & Johnson (NYSE:JNJ), Abbott Laboratories (NYSE:ABT), and Bristol-Myers Squibb Co (NYSE:BMY).

Another case in point is senior and medical property owner Sabra Healthcare REIT Inc (NASDAQ:SBRA). With more than 10,000 boomers turning 65 each day, this landlord can now fund a 10.1% annual dividend yield. But is this high distribution sustainable? Let’s dig into the financial statements. Sabra generated $2.31 per share in adjusted funds from operations (AFFO) last year, a common measure of cash flow for REITs.

Source: Income Investors

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