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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