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My investment goal is to build a portfolio that can provide me with steady income in retirement. I’m looking to invest gradually over time to do this.
Part of that plan involves reinvesting the dividends I receive. But I also have new money to use to buy stocks in September.
I have around £1,000 to invest this month. In my quest to generate lifelong passive income, there are two profitable stocks that have caught my eye.
Federal Realty Investment Trust
It is currently at the top of my list Federal Realty Investment Trust (NYSE:FRT) is a real estate investment trust (REIT) that makes money by leasing retail space to its tenants.
To facilitate its growth, Federal Realty has increased its stock count by about 25% over the past decade. This is the main disadvantage of the stock.
As I see it, though, this very good company is a bit of a failure at an attractive price. Federal Realty is the dividend king, meaning it has raised its distribution to shareholders every year for the past 50 years.
I think it’s worth taking a moment to think about what that entails. In the wake of the 9/11 attacks, the 2007/08 financial crisis and the global pandemic, the organization has increased its payouts.
This shows me that the company can find a way forward even in difficult times. In an uncertain economic and political situation, I think this consistency is important.
The stock has fallen less than 5 percent in the past month.
As a result, the dividend is now over 4%, which I find very attractive.
GSK
I’m watching too. GSK (LSE:GSK) as a passive income opportunity. I don’t often invest in pharmaceutical stocks, but I think this one is too cheap to ignore right now.
GSK shares are down about 19 percent over the past month. This is due to allegations of side effects that may cause cancer. ZantacHeart disease medicine.
So far, the Zantac litigation has reduced GSK’s market value by around £30bn. To my mind, that seems too extreme.
I was reading the other day that drug side effect settlements are in the $2bn-$7bn range. I take this to mean that the £30bn market cap slump is at its worst.
Overall, though, I don’t think the legal issues will have a lasting impact on GSK’s business. The company’s competitive position is supported by unrelated patents and intangible assets. Zantac (Available without a prescription).
Of course, there is a risk that the lawsuit may come sooner than I expect. But I think the pricing in the market right now is really bad.
At current prices, GSK looks like a buying opportunity to me. So when the dividend is more than 4%, I want to increase the shares.