Telecom stocks have been winners this past year, and several analysts see still more gains ahead. Stocks in the telecom industry jumped 17 percent for the 52 weeks through Thursday, third-best among the 10 industries in the S&P 500 index. The overall market rose 9 percent over the same time.
The attraction for investors: dividends. Several telecoms offer dividend yields of 6 percent or greater. They can promise such meaty payouts because their revenue tends to be relatively stable; customers keep paying the phone bill after putting off other, big-ticket purchases. Such stability meant industry heavyweights AT&T and Verizon both boosted their dividends during the recession, when others were slashing dividend payouts. The 6 percent-plus yields look particularly attractive with savings accounts and bonds offering relatively meager rates.
Source: Kitsap Sun
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