Get passive income and growth from 1 share
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Looking for that perfect stock? This quest has probably gotten a lot harder over the past few weeks. Volatility set in and some stocks were decimated. Fortunately, there are still stocks that still have incredible value and can help achieve passive income and growth.
In case you were wondering, this stock is Bank of Nova Scotia (TSX:BNS)(NYSE:BNS).
Why is it the stocks for your portfolio
Scotiabank is like other big banks. It offers a strong nationwide branch network that generates a healthy revenue stream. Like its peers, Scotiabank also offers a generous dividend and has diversified to establish an international revenue stream.
Where Scotiabank differs is or the bank has chosen to invest internationally.
Unlike its peers who opted for the US market, Scotiabank chose to focus on markets further south. Specifically, the bank has targeted markets in Chile, Colombia, Mexico and Peru.
These four nations are part of a trading bloc known as the Pacific Alliance. The Pacific Alliance is responsible for increasing trade and removing tariffs among its member states. To say the block was a success would be a gross understatement. More importantly, this growth has brought Scotiabank in its wake.
This comes thanks to a well-executed expansion throughout the region. As a result, Scotiabank has become a favorite and familiar lender throughout the region. This has led to a series of impressive quarterly earnings reports.
For example, in the last quarter, Scotiabank reported net income of $2,740 million, or $2.14 per diluted share. During the same period last year, Scotiabank reported net income of $2,398 million, or $1.86 per diluted share.
The international segment generated $545 million in profit in the most recent quarter, compared to $389 million in the same period last year. Keep in mind that the region is expected to continue to see tremendous growth for years to come.
In other words, Scotiabank is a great growth stock to hold for the long term. Add to that the fact that Scotiabank is down over 12% in the three month period and you also have an attractive value buy.
Don’t forget income
With all of this focus on growth, let’s not forget the revenue-generating potential that Scotiabank offers. The bank offers an appetizing quarterly dividend that equates to a yield of 4.91%.
To put this income potential into context, consider a $35,000 investment, which will generate over $1,700 in income in the first year. Investors who are not ready to draw on this income can reinvest this income, letting it grow until they need it.
It should also be noted that Scotiabank has been paying dividends without fail since 1833. This makes the bank one of the most stable investments that generate income. Factor in the current present value of the stock, and it’s a hard investment to ignore.
Can you get passive income and growth from just one stock? Scotiabank proves it’s possible. And while no stock is without risk, Scotiabank’s stability and long-term potential are extraordinary.
In short, buy it, hold it, and watch it grow as part of your well-diversified portfolio.