Happy new year! We finally made it. If you're watching this video then odds are your new year's
resolution is to make some extra income so you can start to live the life you've always dreamed.
One popular way to do that is by building out a dividend portfolio. One that pays you every
few months without having to worry about when to buy or sell. Individuals usually
lean towards dividend income if they wish to simplify their passive income stream,
and if you wish to enroll in a DRIP, a dividend reinvestment plan then you can
continuously buy more shares of the company in question by using your dividends to do
so. If this all sounds enticing to you then please sit back, pull up your watch list,
and take a note of these top three dividend-paying stocks for a decent passive income. With
that being said let's get into number one taiwan semiconductor manufacturing. taiwan
semiconductor manufacturing company or tsmc is a company that so few in the general population
have heard of but our lives would be sent to ruin if they disappeared. tsmc manufactures
chips for its customers exclusively so it's never competing with those customers with
products of their own. Apple and AMD are some of the largest customers of tsmc,
but most major semiconductor companies utilize tsmc for their manufacturing this includes arm,
Broadcom, MediaTek, and Nvidia.
And seeing the huge performance gains that Apple's been able to get from their new m1 and m1x chips
in MacBooks, I wouldn't be shocked if other tech companies follow suit in making their own chips.
Already we have seen this occur in other areas where computer chips are becoming more vital than
ever before. The automotive industry for instance is looking into developing their own chips.
Some manufacturers like general motors are even turning to tsmc for help with this process
and as we see an expansion into more power-hungry sectors such as virtual and augmented reality tsmc
is one of the few companies who are capable of keeping up with that demand. Over the past decade
tsmc has tripled the returns of the s&p 500 and generated around 48 billion dollars of revenue in
2020, with a net income of roughly 18.6 billion. With the semiconductor market looking to be worth
around 600 million by 2025, tsmc capturing 24% of all global semiconductor output value, and a
dividend yield of 1.3 percent, tsmc is a great buy for the new year with its potential ever growing
as we approach a more tech driven world. Number two at&t. This one is interesting because I will
be the first to admit that investing in a company that is down roughly 15% since last year can be,
well, terrifying. Add in the fact that at&t has about as much debt as it does equity and things
begin to look a bit scarier. But there is a bit of a silver lining and a reason for me putting this
stock on this list. Currently at&t has an 8.36% dividend yield. While extremely high dividend
yields often bring more questions for investors, at&t spends about 58% of its cash flow on its
dividend payment and has steadily increased its free cash flow over the past decade to compensate.
At&t is also a dividend aristocrat, so the odds of them missing that dividend payment anytime soon is
highly unlikely. Now don't get too excited about that dividend yield just yet because there is some
news... whether it is good or bad is dependent on how you look at it but it's definitely news.
At&t has admitted that its entertainment business was a failure and is now looking to make a deal
with discovery to form a new media company with their existing media assets like hbo and warner
brothers. This is good news because holders will receive shares of this new company and at t will
be unloading 43 billion dollars in debt when the deal goes through. However, this will most likely
result in a lower dividend yield from the company. But with the current yield being as high as it is,
odds are they will still remain a company with a higher than average dividend yield. At&t is also
an incredibly stable and well-known business that is very sticky, most individuals know what at&t
is and about 97 of americans own a cell phone, so while this may be a weird addition to this list,
the future is looking bright for at&t and if you're willing to hold on for the ride then
it will make a great addition to your dividend portfolio. Before we get to our final pick i'd
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at the link in the description, on with the video. Number three, kinsale capital group.
kinsale is such an interesting company that takes the business plan of most insurance companies
and flips it on its head. While most big insurance companies like to target large markets that have
a ton of data and potential customers like auto and homeowners insurance kinsale does the complete
opposite, instead they target these smaller niches that often find it hard to get insurance,
some customers of kinsale include petting zoos or pool installation companies,
places that don't have a cookie cutter method of getting insurance anywhere else. Because this is
such an untapped market, the growth potential for kinsale is huge. Currently the larger competitors
of kinsale who also deal with these excess and surplus insurance customers only account for
about half of the market with kinsale having just a 0.8 percent market share. Kinsale is competing
in a market worth 66 billion dollars compared to the total US insurance market of 1.3 trillion.
With a market cap of 5 billion and trailing 12 month revenues under 600 million Kinsale could
see a 6x in share price over the next 10 years. Not only is there a stellar growth opportunity
for the company but kinsale also offers a 0.2% dividend yield which is just another reason to
add this stock to your dividend portfolio. We hope you enjoyed this video and we hope
you learned something and if you did please let us know down in the comments below or better yet
let us know what stocks you would pick for your own dividend portfolio or maybe some that you're
already holding. And as always please let us know what elements of this video you liked or disliked
because we're always trying to improve here at the motley fool. Thanks for watching and Fool on!