Healthcare is protective, so income investors can trust Pfizer. Prescription drugs are needed regardless of the stock market or U.S. economy. This makes operations cash flow predictable in any economy. Pfizer shares are currently trading at 11 times forward-year earnings, a good price for a business that pays more than 6% to be patient.
Innovation Industrial Properties: 7.03% yield Innovative Industrial Properties, a cannabis-focused REIT, is another great ultra-high-yield dividend stock to buy in April. Since July 2017, "IIP," as the corporation is known, has increased its quarterly payment by 1,113%.
IIP faced two major headwinds. First, marijuana stocks lost steam in early 2021 as it became evident that the Biden administration and Democrat-led Congress would approve few cannabis reforms.
Another difficulty is that several IIP residents fell behind on rent early in 2023. Delinquencies affect all REITs, but how they handle them determines their outlook. Reworking several master-lease agreements and selling two properties allowed IIP's management team to return rent collection to 100% by February 2024.
REIT investors should acquire Innovative Industrial Properties since 95.8% of its more than 100 properties are triple-net leased. A triple-net lease forces tenants to pay all property costs, including utilities, maintenance, taxes, and insurance. While triple-net leases have lower rental rates, IIP avoids surprise costs.
Interestingly, IIP is one of the few corporations benefiting from the cannabis reform congressional stalemate. Most multi-state operators (MSOs) lack basic banking services, hence IIP uses sale-leaseback arrangements. IIP pays MSOs cash for medicinal marijuana growing and processing assets and leases them back. This gives IIP a long-term renter and dependable financial flow.
Innovative Industrial Properties' projected P/E ratio of less than 18 and 7% yield are appealing given legalized cannabis' long-term growth potential in the U.S.
Alliance Resource Partners: 13.97% The third great ultra-high-yield dividend stock to purchase in April is coal producer Alliance Resource Partners (NASDAQ: ARLP). You read correctly—I said "coal company." The decade began with coal stocks dead. Low borrowing rates and a strong U.S. economy were expected to boost worldwide wind and solar investment. But the COVID-19 outbreak modified such plans.
A record energy commodity demand cliff drove global energy businesses to cut capital spending during the pandemic. Domestic interest rates have risen and global crude oil supply has remained restricted since the outbreak. Alliance Resource Partners is filling the energy-demand gap with coal.
Alliance Resource Partners has enjoyed selling coal at a historically high price, but its management staff also contributed to its success. Alliance Resource often books production four years ahead. Locking down volume and price commitments years in ahead gives cash flow clarity to securely make acquisitions, grow production, and pay a large distribution without hurting profitability.
In addition, Alliance Resource Partners' management has constantly slowed output growth. Doing so has kept the company's debt reasonable, unlike its counterparts. Finally, the corporation bought 67,700 acres of royalty oil and gas assets to diversify its revenue. EBITDA from this royalty category should rise if energy commodity spot prices remain high. Alliance Resource Partners is one of the cheapest supercharged dividend stocks with a projected P/E ratio of 5 and a 14% yield.
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