The yield on the average financial security is only 1.5%. And if you’re willing to buy good companies facing likely temporary problems, you can get much higher returns.

Right now, long-term investors looking for high returns should look to Price T. Rowe (NASDAQ:TROW), Toronto-Dominion Bank (NYSE:TD)And W. P. Carey (NYSE:WPC). Here’s a quick look at each of these high-yielding stocks.

1. T. Rowe Price has time to change

T. Rowe Price is an asset manager. It charges fees for providing financial services to customers who purchase its mutual funds, exchange traded funds (ETF) and other investment products.

The key number for investors here is assets under management (AUM), which increase and decrease as customers deposit and withdraw funds and the market rises and falls. The market tends to have more impact than customer financial flows. In fact, customers tend to stay for a long time because transferring money between financial providers is a difficult and time-consuming task. In other words, T. Rowe Price is, in some ways, an annuity-like business.

That said, T. Rowe Price’s historical strength is in mutual funds, a product type that is being replaced by ETFs and alternative assets. This is not good and investors are worried about the stock. However, assets are fragile and management is shifting to areas that customers gravitate toward.

This suggests that T. Rowe Price will adapt over time to changing industry dynamics. And it has more than enough financial muscle to reorganize its activities, knowing that it has no long-term debt on its activities. balance sheet.

That’s why the 38-year dividend streak isn’t likely to end anytime soon, and why long-term dividend investors can have confidence in the high dividend yield of 4.4%.

2. The Toronto-Dominion Bank is a survivor

The Toronto-Dominion Bank, commonly referred to as TD Bank, is the second largest bank in Canada in terms of deposits. It is the sixth largest bank in North America when including its operations in the United States. And it has paid a dividend every year since 1857!

Note that neither the Great Depression nor the Great Recession ended this streak. TD Bank knows how to handle tough times.

And the Canadian banking giant, which boasts a high dividend yield of 5.3%, is facing tough times today. To be fair, the pain is self-inflicted because the company’s US operations have failed to detect and stop money laundering. This cost the company financially and in reputation.

But the bigger problem is that TD Bank is now subject to an asset cap in the United States, which will effectively thwart the bank’s growth plans. Even if Canadian operations are not affected, expansion in the United States should be the engine of growth for TD Bank. It will take time to regain the trust of regulators and investors.

However, you will be paid very well while waiting for this survivor to fall on hard times again. And if more than 100 years of history are to be believed, TD Bank will overcome this crisis.

3. WP Carey made a tough decision

When it comes to tough decisions, WP Carey’s choice to reset its dividend after 24 consecutive annual increases must have been a difficult decision to make. But it was the right decision for the real estate investment trust (REIT), since shedding its office portfolio (which accounted for up to 16% of rents) removed a huge business hurdle.

Unfortunately, exiting the mandate could not be done without a reduction in the dividend. That said, you know this was a reset and not a reduction because WP Carey immediately returned to its normal quarterly increases the quarter after the reset. This was a strategic decision to better position the REIT for the future. But investors remain worried, and this is not unreasonable, and the yield reaches a high level of 6.3%.

What remains after the change is a REIT with a heavy weighting of industrial assets (64% of rents), modest exposure to retail (22%), and a diverse collection of other assets (12%). It also has notable investments outside the American market, representing 41% of rents.

Simply put, WP Carey is one of the most diverse REITs you can buy. And the office closure also left it with cash to invest in future growth opportunities. If you can accept that the dividend cut was really just a reset, this is a high yielding stock that even conservative dividend investors will probably want to own.

Good companies and attractive returns

Every business faces tough times and must find a way to survive or they will be thrown into the trash bin of Wall Street. Right now, T. Rowe Price, TD Bank and WP Carey are all facing headwinds. However, these are all good companies with a solid history of struggling through tough times. Add to that the well-above-average returns each stock offers, and one of these stocks could end up in your portfolio come November.

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*Stock Advisor returns as of November 4, 2024

Ruben Gregg Brewer holds positions with the Toronto-Dominion Bank and WP Carey. The Motley Fool recommends T. Rowe Price Group. The Motley Fool has a disclosure policy.