5 Dividend Stocks to Hold for the Next 5 Years

Not every investor's primary concern is getting the highest return possible, as some prefer to own stocks with high yields that give them a steady stream of dividend income.

Let's look at five dividend stocks across sectors to hold for the next five years.

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1. Realty Income

With a 5.5% yield and monthly dividend payouts, Realty Income (NYSE: O) is a solid option for investors seeking a steady supplemental income source. The real estate investment trust (REIT) primarily leases single-tenant properties to retailers in more recession-resilient industries, although it has been moving into other areas like industrial properties, gaming, and data centers. It uses long-duration triple-net leases where the tenants are responsible for property taxes, insurance, and maintenance, so it doesn't see any surprise surge in expenses.

While Treasury yields and cap rates (a property's net operating income divided by its asset value) can impact the stock, now looks like a good time to own shares of Realty Income.

2. AGNC

If you're looking to max out the highest yield you can get, AGNC Investment (NASDAQ: AGNC) is a solid option to consider. The mortgage REIT sports a 14% yield, and has paid out the same monthly dividend since April 2020.

The REIT owns a portfolio of agency mortgage-backed securities (MBS) that carry virtually no default risk since they are backed by government agencies. However, the value of MBS is impacted by Treasury yields and the spread between Treasuries and agency MBS. MBS spreads tend to be the biggest driver of its portfolio, which is reflected in its tangible book value, and with Fannie Mae and Freddie Mac buying MBS, now looks like a good time to own the stock.

3. Verizon

With a 5.7% yield and well covered and growing divided, Verizon (NYSE: VZ) is a top high-yield stock to consider. The company's decision to become more customer-focused than technology-focused has led to less churn and more subscriber additions. On top of that, Verizon has a big opportunity to bundle and upsell services now that the acquisition of Frontier and its large fiber network is complete.

Adding even more potential upside is Verizon's opportunity to use its fiber network to help provide data center connectivity. It recently signed a $1 billion deal with Alphabet to connect its data centers, and it's also partnered with Corning to source more than 80 million miles of fiber to support AI infrastructure connectivity and network expansion.

4. Enterprise Products Partners

With a 5.7% yield and a 28-year streak of raising its distribution, Enterprise Products Partners (NYSE: EPD) is another top income stock to own over the next five years. The master limited partner (MLP) has a conservative nature with low industry leverage and a robust distribution coverage ratio. Meanwhile, the pipeline company is expecting to see double-digit EBITDA and distributable cash flow (operating cash flow minus maintenance capex) growth next year as new projects come online.

The current environment for pipeline companies is strong, and Enterprise Products Partners remains a top stock in the sector to own.

5. Energy Transfer

Another great midstream MLP to own for the next five years or longer is Energy Transfer (NYSE: ET). The stock sports a 6.3% yield and the company's goal is to grow its distribution by 3% to 5% annually moving forward.

With one of the largest midstream footprints in the U.S. and a strong position in the Permian, Energy Transfer is one of the pipeline companies best positioned to take advantage of growing power demand coming from AI data centers. It has a robust pipeline of high return growth projects, and should see some of the best long-term growth in the space, as a result. On top of that, it is also one of the cheapest stocks in the sector, making it a solid buy around current levels.

Geoffrey Seiler has positions in Energy Transfer and Enterprise Products Partners. The Motley Fool has positions in and recommends Realty Income. The Motley Fool recommends Enterprise Products Partners and Verizon Communications. The Motley Fool has a disclosure policy.