Central banks are keeping interest rates high and say they remain data dependent, which keeps income from cash and bonds uncertain. Dividend Powerhouses with 3%+ yields offer a different source of cash flow that does not rely on guessing rate moves. For investors who want income with potential stability, this article walks through three stocks from the Dividend Powerhouses screener that stand out at this time.

The three stocks below are just a sample, and the full screen surfaced 86 more companies with similarly compelling dividend stories that are not covered here. To identify and analyze the highest conviction income ideas for your watchlist, head straight into the Dividend Powerhouses (3%+ Yield) screener.

Accenture (ACN)

Accenture is a global consulting and technology services company that helps large corporates and governments with digital transformation, cloud, security, AI and outsourced operations. It generates sizeable revenue across diversified industry groups, led by Products at about US$22.3b, Health & Public Service at US$14.9b, Financial Services at US$13.8b, Communications, Media & Technology at US$12.4b and Resources at about US$9.8b. Accenture is a large cap stock with a market value of around US$110.0b.

Accenture sits at the center of the AI and cloud build out, offers a 3.62% dividend yield and reports a 23.7% return on equity, which is why many income investors are watching it closely. However, earnings fell 2% over the past year and growth forecasts are only mid single digit, while heavy AI related restructuring and a planned US$9b acquisition push add execution risk. With the stock trading on a lower P/E than the wider US market and analysts flagging mixed sentiment around bookings, the key question is whether this is a cash rich company in transition or a maturing consultant facing structural pressure that could affect future returns.

Accenture’s AI heavy reset and big US$9b deal push could be masking what really matters for income focused investors. Get the full picture in the DCF valuation analysis for Accenture before the next twist in this story.

Build your own dividend powerhouse shortlist

Accenture and the other two stocks in this list all came from one screener, and you can set up the same kind of focused search in a few clicks. Use our flexible Screener to mix filters like yield, valuation, balance sheet strength and risks, or jump straight into our curated Investing Ideas for ready made starting points.

Medtronic (MDT)

Medtronic is one of the largest medical device companies in the world, supplying hospitals and specialists with products that treat cardiovascular, neurological and surgical conditions. It generates about US$14.0b from Cardiovascular devices, US$10.3b from Neuroscience and US$8.8b from Medical Surgical products, with a further US$3.2b in other revenue, and roughly equal sales in the United States and the rest of the world. Medtronic has a market value of around US$116.1b.

Income focused investors may want Medtronic on their radar because it pairs a 3.13% dividend yield and a 49 year dividend increase streak with a large portfolio of heart, brain and surgical products that serve long term trends in chronic disease. Some analysts highlight the potential for better earnings as Medtronic rolls out new cardiac ablation, neuromodulation and robotic surgery platforms and works through a broad cost and portfolio reshaping program. However, recent margin pressure, product recalls and mixed performance in parts of Diabetes and Surgical indicate that execution remains important. For long term dividend portfolios, the key question is how this mix of cash returns, pipeline potential and operational risk fits with an investor’s objectives and risk tolerance.

Medtronic’s long dividend record, new device rollouts and cost reset could be setting up a very different earnings profile than many investors expect. See how the story fits together in the analysis report for Medtronic

VICI Properties (VICI)

VICI Properties is a real estate investment trust that owns many of the best known casinos and resorts on the Las Vegas Strip, along with a broad mix of gaming, hospitality and experiential properties across the United States and Canada. It generates about US$4.1b in revenue from real estate investment activities and has a portfolio that includes roughly 130 million square feet, 66,000 hotel rooms and more than 700 food and entertainment venues. VICI Properties has a market value of around US$28.6b.

Income investors may find VICI Properties interesting because it pairs a large, triple net leased portfolio of marquee assets with inflation protected rent escalators and a long list of recent deals, including the Golden Entertainment sale leaseback and new resort and youth sports projects. The dividend is backed by high reported net margins. However, earnings growth has slowed to low single digits, debt is not well covered by operating cash flow and tenant concentration in Caesars and MGM keeps rent coverage in focus. With analysts seeing valuation upside and new experiential projects on the way, the key question is whether the mix of yield potential and balance sheet risk suits your income strategy.

Accelerating rent escalators and fresh experiential deals could mean VICI Properties’ yield story is only half told. See how the balance between cash flow, tenant concentration and debt stacks up in the analysis report for VICI Properties

Seeking Alternatives Before The Crowd Moves

Fresh income and growth ideas can get caught quickly once momentum builds. Scan these under the radar lists while the window is open and price moves still matter, then act now.

• Chase stable growth stories that still trade on reasonable terms by running a focused search through the 49 high quality undervalued stocks before they stop looking overlooked.
• Spot tomorrow’s breakthroughs in automation and factory reshoring by scanning the curated group of 39 robotics and automation stocks while these trends are still building up steam.
• Position ahead of the next power infrastructure build out by filtering for companies in the 36 power grid technology and infrastructure stocks while grid upgrades and electrification are only starting to gain pace.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.