"The true investor... will do better if he forgets about the stock market and pays attention to his dividend returns and to the operation results of his companies." – Benjamin Graham

Taking that quote to heart, here are two companies with high dividend yields and improving operations or future growth potential that should have income investors paying very close attention: United Parcel Service(NYSE: UPS), and LTC Properties Inc. (NYSE: LTC).

Return to growth

UPS is one of the world's largest companies. It provides a range of logistics solutions for customers in over 200 countries and territories. While Wall Street might currently have lower expectations for UPS, that doesn't mean income investors should shy away from a stock that offers a solid dividend and could rebound in the near term. The stock has lagged broader markets because customers have shifted to lower-cost shipping options, and it's hurt the company's financials.

In fact, second-quarter consolidated revenues dropped 1.1% compared to the prior year, but consolidated operating profit dropped a staggering 30.1% compared to Q2 2023. Adjusted diluted earnings per share also dropped a brutal 29.5%.

But something else happened that should catch investors' interest: The second quarter could prove to be a turning point, as UPS returned to volume growth in the U.S. for the first time in nine quarters. While one quarter doesn't make a trend, it's certainly a change of pace that's worth noting going forward.

UPS also made a move in July to acquire Estafeta, a leading Mexican express delivery company. The acquisition is targeting a close by the end of 2024 and will boost UPS' business as Mexico's role in global trade continues to rise.

UPS has returned to growth and made key acquisitions. It offers a dividend yield of 4.8% and has maintained or increased its dividend each year since going public in 1999. That makes it a solid dividend stock to buy as it positions itself for a rebound.

Aging population

LTC Properties is a real estate investment trust (REIT) that invests in senior housing and healthcare properties through lease transactions, mortgage loans, and other investments. It's made itself into an intriguing income investment option, as it maintained monthly dividends throughout the COVID-19 pandemic, when most healthcare REITs cut their dividends.

LTC Properties boasts a longstanding executive leadership team with decades of healthcare real estate experience, and has logged 233 consecutive payments of monthly dividends. It also offers a conservative and strong balance sheet with debt maturities matched to cash flow and portfolio maturities -- meaning investors can sleep easier at night.



The growth, however, is what makes this income investment interesting. It specializes in senior housing and skilled nursing properties, and it's worth noting that America's population is aging. More than 4.1 million Americans will turn 65 each year through 2027, generating plenty of demand for LTC Properties. Furthermore, the U.S. adult population aged 85 or older is expected to continue growing rapidly -- it will hit 11 million by 2035 and pass 17 million by 2050.

While income investors wait for the aging population to boost demand for LTC Properties, the company will pay out a healthy 6.2% dividend yield, making it a smart income play for investors.

Buy now?

UPS offers a potential turnaround story as it returns to volume growth in the U.S. and offers investors a near-5% dividend yield while they wait for financials to return to growth. LTC Properties has a bright future as America's population ages and boosts demand for its senior housing and skilled nursing properties, and its 6.2% dividend yield is just icing on the cake. Both stocks look like excellent high dividend-yield options and could be set to soar going forward.

Should you invest $1,000 in LTC Properties right now?

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Daniel Miller has no position in any of the stocks mentioned. The Motley Fool recommends United Parcel Service. The Motley Fool has a disclosure policy.

2 High-Yield Dividend Stocks Set to Soar was originally published by The Motley Fool