So here I’ll identify three great shares to consider buying today. With exposure to various industries and regions, they allow investors to achieve effective diversification — and with it the benefits of risk management and greater opportunities for wealth creation — that this provides.

With a mix of growth, dividend and value shares, this mini portfolio offers added advantages to stock pickers. Growth shares can rise strongly in price if earnings continue to soar. Meanwhile, value stocks can also deliver robust capital gains as the market becomes aware of their cheapness. And dividend shares provide a steady flow of passive income.

Growth

The S&P 500 is packed with high-growth technology shares. But the elevated valuations of many of these leave them in danger of further share price weakness.

However, the cheapness of Dell Technologies (NYSE:DELL) leaves it (in my opinion) at less risk than other more expensive tech businesses. Its forward price-to-earnings (P/E) ratio sits at just 10.3 times.

By marketing a broad range of computer services and products, Dell shares provide multiple ways for investors to capitalise on the booming digital economy. I’m especially encouraged by its potential in the field of artificial intelligence (AI) — it’s expecting AI server sales of $15bn this financial year alone.

City analysts think total earnings will soar 110% in the 12 months to January 2026.

Value

Adding the iShares S&P 500 Value ETF (LSE:0JFT) to a portfolio has two significant advantages. Firstly, as an exchange-traded fund (ETF) it invests in a basket of assets, providing extra diversification benefits. Today, the fund has holdings in 398 US companies.

Secondly, it provides “exposure to large US companies that are potentially undervalued relative to comparable companies“. This can provide superior capital gains potential than a standard S&P 500-related ETF.

The cheapness of the fund can be seen in the following table:

Be aware however, that this value ETF is denominated in US dollars. This can leave investors more exposed to unfavourable movements on forex markets.

Dividends

Real estate investment trusts (REITs) like Crown Castle International (NYSE:CCI) can be excellent long-term dividend providers. Under REIT rules, annual dividends need to equate to at least 90% of profits from their rental operations.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

This doesn’t theoretically make them reliable dividend payers from one year to another. During tough economic times, earnings can suffer if they have problems collecting rents and/or occupancy issues arise.

However, Crown Castle’s focus on the defensive telecommunications industry substantially reduces this risk. The business provides shared communications infrastructure, including 40,000 cell towers across the country and around 85,000 miles of fibre.

The dividend yield here is a healthy 4.7%. I think it’s a top REIT to consider despite the problem of rising costs.

The post Here’s a starter portfolio of S&P 500 shares to consider for growth, dividends and value! appeared first on The Motley Fool UK.

As such, despite the lofty payout ratio, dividends often end up being sustainable. And it’s why I have several of these stocks already in my income portfolio. With that in mind, let’s explore one REIT I think looks like a promising investment candidate for my portfolio in 2024.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

Profiting from 5G

The London Stock Exchange is home to a wide range of telecommunication companies, with BT Group and Vodafone arguably the most prominent. But despite both having potential, neither business is in good shape after suffering years of managerial complacency.

However, a quick glance across the pond reveals Crown Castle (NYSE:CCI) to be an interesting opportunity. The company effectively acts as a landlord for other telecommunication businesses that want to use its vast network of towers across the US. It’s the largest infrastructure company in the country, with over 40,000 cell towers. And yet the stock has been decimated these last few years.

With the American market already largely saturated, the firm’s growth rate has been under pressure. However, underlying cash flows still seem to be largely moving in the right direction due to continued demand from mobile network providers.

Moreover, the rollout of 5G has led to a rising number of upgrades for its towers that’s also sparking some upward momentum in the financials. So much so that its funds from operations actually exceeded analyst expectations in its latest results. So why has the stock been hammered so hard of late?

Unfriendly macroeconomics

As previously mentioned, REITs tend to carry a lot of debt. With so much capital being redistributed to shareholders, reliance on external financing is largely inevitable. And that makes the recent rise in interest rates double-trouble.

Apart from increasing the cost of servicing its financial obligations, the fair value of its real estate portfolio is also taking a hit from higher rates. And it’s led to a lot of paper losses that have dragged the firm’s market capitalisation into the mud.

However, management seems to be navigating through the current economic climate with some resilience. And with interest rate cuts expected to emerge later this year, an upward correction in its asset portfolio could help undo some of its lacklustre share price performance.

Pairing this with a sustainable looking 5.5% yield, the worst may be over for this REIT. And with the continued rollout of 5G technology in America acting as a sizable tailwind, the group’s near decade-long track record of hiking dividends looks set to continue. At least, that’s what I think.

The post 1 REIT I’d consider buying for another income stream in 2024 appeared first on The Motley Fool UK.

Shaping the world’s digital infrastructure

The company in question is Crown Castle (NYSE:CCI). It owns and leases network infrastructure in the US to some of the largest telecommunication businesses, including T-Mobile, AT&T, and Verizon. In total, the group’s asset portfolio contains more than 40,000 mobile towers, 115,000 mobile nodes, and roughly 85,000 miles of fibre optic cables.

Customers pay a monthly rent to borrow the infrastructure for their own businesses. This means a steady and reliable stream of cash flow. After all, client contracts typically last a minimum of five years, with some extending to as much as 15 years. And with prices incrementally increasing each year, revenue and earnings have steadily risen. Subsequently, dividends have followed suit, creating a passive income stream that’s growing by an average of 9.4% annually.

Investing in mobile towers is hardly the most exciting enterprise. However, an independent report by research group IHS Market has revealed a multi-trillion-dollar opportunity within 5G. The fifth-generation telecommunication technology is capable of near-zero latency. That’s a critical requirement for evolving systems like autonomous vehicles, drone deliveries, automated farming equipment, remote surgery, and countless other applications.

That’s why 5G is expected to boost global GDP by 10.8% over the next decade. And Crown Castle is perfectly positioned to capitalise on this technological revolution.

Building a £1,000 passive income

Today, the business trades at a stock price of $145 and returns $6.26 per share in dividends annually. This places the yield at a tasty 4.3%. Based on the current exchange rates (£1,000 roughly equals $1,230), I would need to buy 197 shares to hit my passive income target.

Unfortunately, that’s not the cheapest of transactions since I would need around $28,500 (£23,000). However, hitting this goal isn’t as impossible as it may seem. Something as simple as a FTSE 250 index tracker has historically delivered an annual return of 10.6%. If I were to invest just £500 a month into one, I could theoretically generate the required capital in just over three years.

As exciting as that sounds, there are, of course, risks. Setting up telecommunication infrastructure isn’t cheap. Consequently, Crown Castle has and continues to rely on debt financing. This is becoming increasingly expensive due to rising interest rates.

Furthermore, historical performance is usually a poor indicator of future results. And the FTSE 250 may not be as generous in the coming years. So it could take longer to amass the required capital, especially if exchange rates move in an adverse direction in the meantime.

Despite these caveats, the investment case remains compelling, in my eyes. And that’s why I’m tempted to snatch up some shares for my own income portfolio once more capital becomes available.

The post I’d buy 197 shares of this stock for a £1,000 passive income appeared first on The Motley Fool UK.