Blue Chip Dividend: EPD, AOS and LOW

Even in the most difficult of circumstances, these blue chip stocks could just be what you need in order to provide a consistent passive income
WAN CHAI, Hong Kong - June 19, 2022 - PRLog -- In recent months, financial markets have been shaken up by the threat of imminent interest rates rising and a probable economic crisis. For example, the S&P 500 index has dropped 19% this year alone. On the other hand, growing passive income might divert an investor's attention away from unrealized losses during a market collapse like the present one. Here are three equities that could potentially give investors income with higher-quality and a market-beating passive income.

Enterprise Products Partners L.P. (EPD)

Enterprise Goods Partners (EPD), is one of the world's largest midstream corporations with a system of over 50,000 miles of natural gas, natural gas liquids, crude oil, petrochemicals and refined product pipelines.

The raw materials Enterprise's infrastructure utilizes both transportation and storage in almost anything that involves petrochemicals, thus demand for its infrastructure isn't going away anytime soon. According to the International Energy Agency, global economic development and population expansion would result in higher overall demand for EPD's pipelines through 2040 compared to 2019.

A. O. Smith Corporation (AOS)

Because people and companies need hot water for washing, bathing and even industrial purposes, demand for hot water heaters is expected to rise in the coming years. This is the basic theory that drives AOS, a maker of both home and commercial water heaters and boilers. This makes AOS quite appealing.

According to Allied Market Research, the worldwide water heater market will grow at a compound annual rate of 5.1% from $32.6 billion in 2017 to $48.5 billion in 2025. Analysts anticipate that AOS will provide 8% annual profit growth over the next five years due to its strong market share in an industry with a positive growth forecast. With a dividend payout ratio of 35.1% in 2021, the Dividend Aristocrat appears to be on track to continue its 29-year streak of dividend increases.

Lowe's Companies Inc. (LOW)

After The Home Depot Inc. (HD), LOW is the second biggest home improvement retailer in the United States and Canada with almost 2,200 locations. LOW can use its brand strength in a fragmented but large $900 billion home improvement business, according to the investment thesis.

LOW has increased its dividend distribution to its shareholders every year for the last 59 years, making it a Dividend King. With a payout ratio of only 23.3% in 2021, LOW should be able to raise the dividend by double digits later this month, extending its dividend increase run to 60 years.

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