Investors have a wide variety of choices in the US market when it comes to growth stocks.
But what’s even better than growth stocks are those that also pay out a dividend to boot.
This attractive mix of growth and income means that you get paid while enjoying the growth of the business.
Call it the best of both worlds, but such stocks should appeal to investors who are looking for growth while yearning for a source of passive income.
Here are four reputable US stocks that can provide this interesting combination.
Mastercard (NYSE: MA)
Mastercard is a payment processing company that acts as a middleman to facilitate secure and efficient payment transactions between customers and vendors.
As of 30 September 2024, Mastercard had 3.4 billion cards in issue.
For the first nine months of 2024 (9M 2024), revenue increased 11.5% year on year to US$20.7 billion while operating profit increased 9.5% year on year to US$11.6 billion.
Net profit came in at US$9.5 billion, up 13.4% year on year.
The company also generated a positive free cash flow of US$9 billion, 28% higher than the US$7 billion churned out a year ago.
Mastercard declared a quarterly dividend of US$0.76 for its latest quarter, up 15.2% year on year from US$0.66 a year ago.
The annualised dividend stands at US$3.04 per share.
Last year, Mastercard announced the acquisition of Recorded Future, the world’s largest threat intelligence company, for US$2.65 billion.
This acquisition will help to boost the company’s insights and intelligence to complement Mastercard’s existing suite of cybersecurity services.
Last November, Mastercard also announced a comprehensive digital solution called Biz360 to equip small business customers with a simplified way to run and grow their businesses.
Mondelez International (NASDAQ: MDLZ)
Mondelez International is a food and beverage company sells snack foods to more than 150 countries globally.
The company manufactures and sells its products under famous brands such as Oreo, Ritz, Cadbury, Milka, and Toblerone.
Mondelez reported a strong set of earnings for 9M 2024 with revenue inching up 0.5% year on year to US$26.8 billion.
Operating profit jumped nearly 10% year on year to US$4.7 billion.
Excluding one-off items such as gains/losses on securities, Mondelez’s net profit would have climbed 20.3% year on year to US$3.5 billion.
The company is also a consistent free cash flow generator with a 9M 2024 positive free cash flow of US$2.5 billion, up 4% year on year.
The snack producer’s latest quarterly dividend came in at US$0.47, taking its annualised dividend per share to US$1.88.
This dividend was also 10% higher than the US$0.425 paid out a year ago.
The business has a hedging structure in place to guard against the sharp spike in cocoa prices, and does not intend to reformulate its chocolate products.
Mondelez also entered into a partnership with Amazon Web Services to enhance digital innovation across the company and has appointed Amazon (NASDAQ: AMZN) as its strategic cloud provider.
Parker Hannifin (NYSE: PH)
Parker Hannifin is a leader in motion and control technologies.
The company manufactures products for the industrial and aerospace markets and has increased its dividends for 68 consecutive fiscal years.
Parker Hannifin reported an encouraging set of earnings for the first quarter of fiscal 2025 (1Q FY2025) ending 30 September 2024.
Revenue edged up 1.2% year on year to US$4.9 billion and net profit stood at US$698.4 million, up 7.3% year on year.
The business also churned out a positive free cash flow of US$648.7 million, 17.5% higher than the US$552.2 million generated a year ago.
A quarterly dividend of US$1.63 per share was announced and will be paid on 7 March, taking Parker Hannifin’s annualised dividend to US$6.52.
This quarterly dividend was 10% higher than the US$1.48 paid out a year ago.
Management expects FY2025 to record organic growth of between 1.5% to 4.5%.
Free cash flow is expected to come in the range of US$3 billion to US$3.3 billion.
Medtronic (NYSE: MDT)
Medtronic is a medical device company that manufactures products for more than 70 health conditions includes Parkinson’s and diabetes.
These products are sold across 150 countries and Medtronic employs more than 95,000 staff globally.
For the first six months of fiscal 2025 (1H FY2025) ending 25 October 2024, Medtronic saw its revenue rise 4% year on year to US$16.3 billion.
Operating profit climbed 14.5% year on year to US$2.9 billion while net profit surged 36% year on year to US$2.3 billion.
For 1H FY2025, Medtronic also saw its free cash flow soar 41.5% year on year to US$1 billion.
This consistent free cash flow generation has enabled Medtronic to continue to increase its dividend, with its latest quarterly dividend being US$0.70.
The healthcare company’s annualised dividend stands at US$2.80, a slight increase from the annualised dividend of US$2.76 a year ago.
Earlier this month, Medtronic received the CE Mark approval from the European Union for its deep brain stimulation (DBS) technology that helps to transmit electric signals to the brain to help patients with Parkinson’s disease.
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Disclosure: Royston Yang owns shares of Mastercard.
