Dividend Investing: 3 Dividend Stocks to Own Forever

Dividend Investing3 Top Dividend Stocks

Ronald Read was known around town as a regular guy—but he also had a secret talent for picking dividend stocks.

The Vermont native gave no hint as to the size of his wealth. The former janitor often held his coat together with safety pins. His flannel shirt was so old, someone once paid for his breakfast at Friendly’s. (Source: “‘Frugal’ ex-janitor leaves millions to local library, hospital,” New York Post, February 4, 2015.)

His hidden talent was only revealed after his death last year. Read stunned local residents after leaving $6.0 million to the town. His investments, Read’s lawyer, Laurie Rowell, explained, “grew substantially” through the years.

Read didn’t get rich through day trading. Rather, he lived frugally. With his savings, Read bought classic dividend stocks like CVS, AT&T, and General Electric.


Few of us will do as well as Ronald Read. His story, though, is another example of how normal people build wealth in the stock market. Few get involved with penny stocks or derivatives. Rather, they buy great companies and hold on for the long haul.

Thousands of regular folks have used this same method to create small fortunes. And if you’re looking to build wealth, you could do worse than emulating Mr. Read. Here are three dividend stocks that could help you do just that.

1. Bank of Montreal

Since 1829, Bank of Montreal (NYSE:BMO) has paid a dividend to investors.

Think of everything that has happened during that time: two world wars, the Great Depression, and stock market bubbles. Yet through all that, shareholders always received a dividend check.

How did BMO pull this off? Well, ol’ fashion Canadian conservatism for starters. The country’s financial sector is also a cozy oligopoly, which keeps competitors out.

This has allowed BMO stock investors to earn excess returns without the worry of rivals driving down margins. For shareholders, that has translated into a growing stream of profits…and dividends.

2. Union Pacific Corporation

Union Pacific Corporation (NYSE:UNP) is a true “forever stock.”

The firm’s rail lines would be tough to copy. The huge cost to buy right-of-ways forms an almost impenetrable barrier to entry. As a result, the company churns out huge profits year after year.

Of course, the real test is a downturn, how a business holds up during hard times. That said, Union Pacific has paid a dividend to shareholders for decades. Even through the last recession, the UNP stock’s dividend payout was never cut.

Here’s the bottom line: there are going to be more people living in this country. Those people will demand more goods and services. Union Pacific will play a key role in moving those products across the country.

3. Pembina Pipeline Corp

This is the best dividend stock you’ve never heard of.

In fact, most people don’t even know this company exists. On average, shares trade hands less than 400,000 times a day—a fraction of the volume on some blue-chip stocks.

The company is called Pembina Pipeline Corp (NYSE:PBA). But just because you’ve never heard of it, that doesn’t mean this is some unproven business. When you own this stock, you are a partner in one of the most lucrative businesses in the world.

Pembina owns energy pipelines and terminals, shipping commodities like oil and natural gas. You could think of this firm like a “tollbooth.” Rather than drill for oil itself, the company earns a fee on each barrel that flows through its network.

So, whether oil it’s at $20.00 a barrel or $200.00, Pembina still gets paid. Since going public in 1998, Pembina has never missed a payment to shareholders.

Today, the stock yields 5.5%, though I expect many more dividend hikes in the years ahead.

Of course, these aren’t the only stocks that crank out reliable distributions. For more ideas, check out our special report, “Secret 424(k) Accounts Creating New Retirement Millionaires?” These accounts pay out huge dividends and yield up to 12%. Click here now to get the full story!