Friday, September 12, 2014

A Search for Yield

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US Treasury issues maturing in 10 years carry a yield of just 2.5%. Shorter-term issues pay much less. So do the government bonds of other developed nations. High-yield corporate bonds and those from emerging markets pay somewhat more, but their income also is depressed by historical standards.

This situation adds to the luster of vehicles that pay a relatively good yield now, such as 2.5% or more, and that offer good potential for future payout increases. Here are some names to consider and research: three lists of common stocks and one of energy master limited partnerships (MLPs).

#1: Dividend Aristocrats. These are the stocks in the Standard & Poor’s 500 whose annual dividends have risen for 25 or more consecutive years, and that currently pay 2.5% or more. The stocks are ranked by yield.

AT&T (NYSE: T), 5.3%

HCP Inc. (NYSE: HCP), 5.1%

Consolidated Edison (NYSE: ED), 4.4%

Cincinnati Financial (NYSE: CINF), 3.7%

Chevron (NYSE: CVX), 3.5%

Leggett & Platt (NYSE: LEG), 3.5%

McDonald’s (NYSE: MCD), 3.5%

Target (NYSE: TGT), 3.3%

Clorox (NYSE: CLX), 3.3%

Kimberly-Clark (NYSE: KMB), 3.1%

Procter & Gamble (NYSE: PG), 3.1%

Sysco (NYSE: SYY), 3.0%

ExxonMobil (NYSE: XOM), 2.9%

AbbVie (NYSE: ABBV), 2.9%

Coca-Cola (NYSE: NYSE: KO), 2.9%

PepsiCo (NYSE: PEP), 2.9%

Johnson & Johnson (NYSE: JNJ), 2.7%

Emerson Electric (NYSE: EMR), 2.7%

Nucor (NYSE: NUE), 2.7%

Bemis (NYSE: BMS), 2.7%

Genuine Parts (NYSE: GPC), 2.6%

Wal-Mart Stores (NYSE: WMT), 2.5%

Aflac (NYSE: AFL), 2.5%

#2: Dogs of the Dow. Here are the 10 highest-yield stocks in the Dow Jones Industrial Average, in order of yield.

AT&T (NYSE: T), 5.3%

Verizon Communications (NYSE: VZ), 4.4%

Pfizer (NYSE: PFE), 3.5%

McDonald’s (NYSE: MCD), 3.5%

Chevron (NYSE:! CVX), 3.4%

General Electric (NYSE: GE), 3.4%

Procter & Gamble (NYSE: PG), 3.1%

Cisco Systems (NSDQ: CSCO), 3.0%

Merck & Co. (NYSE: MRK), 2.9%

Coca-Cola (NYSE: KO), 2.9%

#3: Nasdaq 100 yield leaders. This list, which features many technology companies, is of stocks that pay 2.5% or more, ranked by yield.

Vodafone Group (NSDQ: VOD), 7.0%

Mattel (NSDQ: MAT), 4.4%

Staples (NSDQ: SPLS), 3.9%

Maxim Integrated Products (NSDQ: MXIM), 3.7%

Kraft Foods Group (NSDQ: KRFT), 3.6%

Paychex (NSDQ: PAYX), 3.6%

Garmin Ltd. (NSDQ: GRMN), 3.6%

CA Inc. (NSDQ: CA), 3.5%

Cisco Systems (NSDQ: CSCO), 3.0%

Analog Devices (NSDQ: ADI), 3.0%

Seagate Technology (NSDQ: STX), 2.8%

Wynn Resorts (NSDQ: WYNN), 2.7%

Xilinx (NSDQ: XLNX), 2.7%

Texas Instruments (NSDQ: TXN), 2.5%

KLA Tencor (NSDQ: KLAC). 2.6%

Intel (NSDQ: INTC), 2.6%

#4: Master limited partnerships. Here are the 10 biggest MLPs in midstream energy (transport and storage) that carry yields of 5% or more. Again, they’re listed in order of yield.

Enterprise Products Partners (NYSE: EPD), 7.1%

Energy Transfer Partners (NYSE: ETP), 6.7%

Williams Partners (NYSE: WPZ), 6.7%

El Paso Pipeline Partners (NYSE: EPB), 6.5%

Kinder Morgan Energy Partners (NYSE: KMP), 6.0%

Regency Energy Partners (NYSE: RGP), 6.0%

Enbridge Energy Partners (NYSE: EEP), 6.0%

DCP Midstream Partners (NYSE: DCP), 5.5%

ONEOK Partners (NYSE: OKS), 5.3%

Cheniere Energy Partners (NYSE: CQP), 5.2%




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