Check out some of our top picks for low-cost contractors below!
Alexandria Real Estate
What it does: The company focuses on creating, acquiring, and managing life science campuses in key innovation hubs.
Written by Oliver Rodianko. Alexandria Real Estate (NYSE: ARE) is my favorite investment right now. It is famous for its long-term price growth and its sweet 4.5% yield.
Also, it is currently down about 50% from its all-time high, so it doubles as a profit and investment value.
The business has established employers in leading biotech, pharmaceutical, and technology companies. This offers stable and long-term leases. The field of life sciences is positioned for continuous growth amid technological innovation. So, I’m very happy about it.
That being said, a concentrated focus on the life sciences and technology sectors makes the company vulnerable to declines in these industries. Therefore, it is wise for me not to depend only on Alexandria Real Estate for my dividend income.
I bought shares at the beginning of the year, and will be adding to my position regularly as long as the valuation remains attractive.
Oliver Rodianko is a shareholder in Alexandria Real Estate
HSBC
What it does: HSBC is a global bank operating in over 60 countries, with a strong focus on Asia. Globally, it serves more than 40m customers.
Written by Charlie Keough. One of my favorite income shares is HSBC (LSE: HSBA). The stock is yielding a whopping 7.5%. That has been steadily increasing over the past few years.
That includes a 90% increase over the past year when its payout rose from 31 cents per share to 61 cents. In parallel, it completed share buybacks worth $7bn.
HSBC recently spun off its Canadian unit. With the proceeds, the company plans to pay shareholders a special dividend of 21 cents this year. That takes its yield close to 10%, making it one of the highest FTSE 100.
I have one main concern with HSBC. It is heavily invested in Asia and this has caused banking problems recently. China’s economy is not firing on all cylinders. It struggled to grow. As such, HSBC was contacted directly.
But in the long run, I expect its regional focus to pay dividends (really!). I hope to add to my position at HSBC soon.
Charlie Keough is a shareholder in HSBC.
MONY Group
What it does: MONY Group operates a savings platform Moneysupermarket.com and a refund facility Quidco
Written by Paul Summers. My investment in Moneysupermarket.com the owner MONEY (LSE: MONY) a few years ago it was still going to produce a profit. However, I’m more than happy to stay invested for the income the company produces.
This stock yields 5.7%. That’s a lot more than I could get by just having a tracking bag FTSE 250. But it’s not so high that I doubt the money will end up in my account.
To be sure, mid-caps operate in a highly competitive environment. There is a question of how much it can grow here as well. However, increased power switching as deals become more competitive should help.
While it may mean losing that good income stream, I also wouldn’t be surprised if MONY was subject to a takeover bid or two in the near future.
Paul Summers is a shareholder in the MONY Group
Real Income
What it does: Realty Income owns and leases a portfolio of commercial properties, with a focus on retail properties.
Written by Stephen Wright. I have shares Real Income (NYSE:O) for some time now. And I don’t expect to sell them anytime soon.
The company is a real estate investment trust (REIT) that leases retail space to its tenants. Most of its business comes from the US.
Operating on a triple lease basis helps reduce the overall cost – and risk – of the company. It means that tenants pay for things like insurance, taxes, and maintenance.
A number of its biggest employers – the likes of Walgreens Boots Alliance – have found themselves in trouble recently. And that increases the risk of unpaid rent.
Realty Income has a very diverse portfolio. As a result, the overall impact of any single employer going into difficulty is limited.
For the foreseeable future, I look to continue to collect dividends from the company. It has been incredibly stable in the past and I think the outlook is great from here.
Stephen Wright is a shareholder in Realty Income.
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