Here is probably the standard list of dividend stocks that pays 4.0% or above that you may find from other sites. The table is based on Jun 16, 2006 Friday’s closing price, using the last paid dividend projected forward for one year which is the way Yahoo display the dividend yields in the basic information. By the way, this list is mostly from Dow Jones Industrial 30:
|
Stock Symbols |
Yield |
|---|---|
|
4.20% |
|
|
4.10% |
|
|
4.50% |
|
|
4.10% |
|
|
4.40% |
|
|
5.00% |
I don’t know about you, but when I look at this short list, I almost feel depressed by the low yield. In fact, out of all these stocks, I would probably only suggest buying VZ, PFE, and just maybe MO (if you don’t care about the ethical ramification). Financial stocks are usually the higher dividend-paying stocks these days. However I don’t like financial stocks because I believe going forward financial stocks may constitute a lesser percentage in terms of market capitalization of the total market (which means that they may underperform).
Okay, here is my list:
|
Stock Symbols |
Yield |
Comment |
|---|---|---|
|
11.8% |
foreign tax due |
|
|
13.0% |
foreign tax due |
|
|
8.7% |
foreign tax due |
|
|
9.5% |
foreign tax due |
|
|
7.5% |
pays royalty |
|
|
7.5% |
pays royalty |
|
|
7.2% |
MLP partnership |
|
|
6.9% |
MLP partnership |
|
|
7.0% |
MLP partnership |
|
|
6.4% |
MLP partnership |
|
|
6.6% |
MLP partnership |
|
|
18.6% |
oil tanker |
|
|
18.1% |
oil tanker |
|
|
17.2% |
oil tanker |
|
|
17.6% |
oil tanker |
|
|
8.9% |
foreign tax due |
This list doesn’t include any REIT, which are historically good dividend paying stocks except now. I hope you find this list useful. And if you do make money off this list, please consider donating something here through PayPal (I can’t imagine you doing that now, but maybe after you’ve earned your first $5K dividends….), and/or at least leave a comment for appreciation. This list is actually part of my recipe for my yet-to-be money management company, in respect to the part for the high dividend yield investments. Aren’t you glad you just save 1% for the management fee either from me 
or from someone else?
This list is by no means exhaustive. You can use them as the starting point of your research to find more similar business and stocks. At the minimum, you must look at the dividend paying history to get a feel of the true dividend paying rate, because some stocks may potentially have a distorted higher or lower dividend yield shown above due to a temporary high or low dividend payment. Also, please DON’T rush out and buy the highest yield stocks on this list. Here are some of the things that you should heed:
- The yield is usually proportional to the (downside) risk. The best example to illustrate this is SGU falling 80% in a single day on Oct 18, 2004. Right before the fall, SGU was paying 10.8% dividend yield.
- Pay attention to diversify among stocks from various sectors, so that the probability of getting hit on all stocks all at once is smaller.
- Plot out the yield curve & stock price on the same chart if possible. It will tell you whether stock prices went up because of increasing dividend payouts or because of a shrinking yield due to reasons such as investor frothiness (PTR & ERF used to pay out 11% to 14%). In the latter case, your current entry will be more riskier when the investors change their expectation for worse.
- You can potentially run into having too much foreign dividend and end up getting 15% less from the yield that you deserve. (No, I’m not kidding here. I’m forced to cut back and sell my dividend stocks so that I don’t hit the limit in respect to this tax rule. At 13.4% yield, investing $30K will exceed the limit.)
I’m not providing any performance numbers because I believe one must always do one’s own diligent research before buying stocks. But I can tell you from my own experiences that I made a lot of money from these stocks, more than $11000 in actual dividends (not including any non-dividend distributions such as royalty payments) in the year of 2005. Most of my dividend stocks return in excess of 15% annualized, and many exceed 20% or more due to stock price appreciation besides dividends. By the way, if you find some names on this list that don’t have such a great overall return, I’ve only included them simply because their short-term setbacks may actually be good buying opportunities.
Also, if you blog on any stocks on this list or similar stocks to them, I appreciate that you respect my contribution since it took quite some time & resources over past two years to collect these information. A link in your article that links back to this original post will do.
As the final conclusion to my dividend series, here are all the previous posts related to my dividend investing. There are many different tax issues involved and discussed in the series. That’s part of the invisible price that you need to pay for investing in such stocks:
- My dividend investing ($11775.91 for 2005)
- Master Limited Partnership – Great Dividend Savers
- Royalty Trusts – Get Paid Royalties w/o Paying (Much) Taxes
- REIT as an Alternative Dividend Investment
- Foreign Taxes Withheld Problem (this is not part of the series, but most likely you will face the same problem.)
And I apologize to not giving this list to you sooner since my very first original post, which only gave out good and general information, but not much details. It served only to catch your eyes. I wanted to complete this series sooner, but I have been simply overhelmed by all of my blogging and non-blogging activities. Since the stock market seems to be reaching a bottom here, it is actually better that I’m providing this list at such time.
A quiz: do you know which stocks tend to go up, and which stocks tend to go down a little when the stock market have a strong bounce up? If you have studied my dividend investing series carefully, and have been watching these stocks for sometime, you should be able to answer this question confidently. Okay, a hint for you, what are more like bonds?
Just repeat of my legal disclaimer here: I don’t assume any responsibility for your investment decisions based upon anything on http://www.1stmillionat33.com/. The advices here are provided “AS IS”, and readers are advised to obtain further research or consultation.
