nobody knows exactly what the future will bring us. However, some companies have more visibility into what lies ahead due to the durability of their cash flow and the growth investments they have secured. That gives them a lot of confidence in their ability to continue increasing their dividends.
Brookfield Renewables (NYSE: BEPC) (NYSE: BEP) and Oneok (NYSE: OKE) have visibility of its growth over the next five years. As a result, you can confidently hold these dividend stocks for the long term.
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Brookfield Renewable operates a globally diversified portfolio of renewable energy assets. It sells most of the electricity it produces through long-term power purchase agreements (PPAs) with utilities and large corporate customers (90% of which have contracts for an average of 13 years). Most of these PPPs link rates to inflation (70% of is revenue). The company routinely signs PPAs at higher rates as legacy deals expire. For example, it recently signed two 20-year hydroelectric agreements with Googlerepresenting more than $3 billion in revenue. As a result, Brookfield generates stable and ever-increasing cash flow.
The company also has a huge pipeline of renewable energy development projects (84 gigawatts (GW) of advanced stage projects). Last year it delivered 8 GW of new capacity and expects to increase its annual delivery rate to 10 GW by 2027. The company expects to deliver 10.5 GW of capacity to microsoft only in the period from 2026 to 2030 as part of its global renewable energy framework agreement.
Brookfield’s growth drivers, which also include acquisitions, drive its view that it can grow its funds from operations per share by more than 10% annually through 2030. That supports its plans to increase its 3.7%-yielding dividend by 5% to 9% annually. Brookfield has increased its payout by at least 5% annually since 2011.
Oneok is a leader pipeline company. It has a diversified portfolio of midstream assets generating fee-based cash flows backed by long-term contracts and government-regulated rate structures (over 90% of earnings based on fees).
The company has significantly expanded and diversified its operations in recent years through a series of acquisitions. Oneok still expects to capture hundreds of millions of dollars in commercial synergies from these deals in the coming years, boosting its cash flow. Additionally, the company has several organic expansion projects underway that should enter commercial service by mid-2028. It has ample financial flexibility to make bolt-on acquisitions and approve additional expansion projects to further enhance and expand its growth.