From Yahoo Finance: 2025-04-12 05:47:00

Dividend investors are facing a tough situation with high stock valuations. The S&P 500 has a 1.3% yield, but Citigroup offers a 3.8% yield. However, two lesser-known financial stocks have even higher yields and potentially more attractive businesses.

Citigroup’s dividend has increased by over 1,000% in the past decade, from $0.005 per share in early 2016 to $0.56 per share at the end of 2024. This recovery from the Great Recession cut is significant but still below pre-cut levels.

Despite Citigroup’s improved financial state post-Great Recession, conservative dividend investors might prefer higher-yielding stocks like Realty Income and Federal Realty. Realty Income, a net lease REIT, offers a 5.8% yield with a dividend increased annually for three decades.

Realty Income’s investment-grade balance sheet and diversified portfolio across North America and Europe make it a reliable choice for income-oriented investors. Federal Realty, with a 4.9% yield, is another consistent REIT that has increased its dividend annually for 57 consecutive years.

Citigroup may offer an attractive yield, but its past performance during the Great Recession raises concerns for dividend-reliant investors. Consider high-yielding stocks like Realty Income and Federal Realty, which have better yields and stronger dividend histories.

*Stock Advisor returns as of April 5, 2025. Citigroup is an advertising partner of Motley Fool Money. Reuben Gregg Brewer has positions in Federal Realty Investment Trust and Realty Income. The Motley Fool has positions in and recommends Realty Income. The Motley Fool has a disclosure policy.

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