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It takes money to make money. However, it doesn't require a lot of cash to get started generating passive income. Several high-quality dividend stocks cost less than $33 a share.
Three great ones under that price point are Brookfield Renewable (NYSE: BEPC)(NYSE: BEP), Invitation Homes (NYSE: INVH), and Kinder Morgan (NYSE: KMI). Because of that, you can buy one share of all three for less than $100. That would supply you with a growing stream of dividend income that you can add to as you have more cash to invest.
A high-powered dividend stock
Brookfield Renewable is a leading global renewable energy producer. Its shares currently fetch less than $29 apiece. The company pays a quarterly dividend of $0.355 per share ($1.42 annually). That gives it a nearly 5% dividend yield at the recent share price.
The renewable energy giant has increased its dividend payment at a 6% compound annual rate since 2001. It aims to grow its payout at a 5% to 9% yearly rate in the future.
Brookfield Renewable has ample power to achieve that growth plan. It expects to grow its funds from operations (FFO) per share at a more than 10% annual rate over the next decade. That growth is highly visible and secured through 2029 and increasingly visible and secured beyond that. It has multiple growth drivers, including inflation-linked rate increases on existing power purchase agreements, a vast pipeline of development projects, and acquisitions.
Cashing in on the affordability gap
Invitation Homes is a real estate investment trust (REIT) that owns and manages single-family rental homes. Its share price was recently just below $33. The landlord pays a quarterly dividend of $0.29 per share, which it recently increased by another 3.6%. It has raised its dividend every year since it came public in 2017. Its payout now yields 3.6%.
The REIT has many growth drivers. Its existing portfolio should continue to supply a growing stream of rental income as it increases rents. It's benefiting from strong demand for rental housing due to the affordability gap between renting and buying a home (which is currently more than $1,000 a month in its markets).
On top of that, Invitation Homes will continue to expand its portfolio, which consists of more than 110,000 homes it owns or manages. It has partnered with several leading homebuilders, which will deliver about 2,500 new homes to the REIT in the coming years. Invitation Homes also buys properties from various other channels, including purchasing existing homes listed for sale, acquiring properties and portfolios from other investors, and investing in joint ventures. For example, it recently invested $50 million into a joint venture that plans to deploy $500 million into buying newly constructed homes and communities in several high-growth markets. These growth drivers should enable the REIT to continue increasing its dividend.