Dividend Stocks That Demand Attention

If there were a trade association of dividend-paying corporations they would surely be handing out a lifetime achievement award to Federal Reserve chairman right about now. Bernanke’s beat-down on interest rates has pushed the yield on Treasury and high-grade corporate debt so low that income investors have little choice but to venture into the land of dividend paying stocks and their bond-beating yields.

For someone who bought at the 2002 high and still owns that share of Coca-Cola (KO), today’s $1 per share annual dividend works out to a yield of nearly 3.5%. McDonald’s (MCD) has an even juicier dividend growth story as its per-share annual dividend has grown from 24 cents 10 years ago to $2.71 today. That 24-cent payout meant a measly dividend yield below 1% for someone who bought at the 2002 high. But that same share would now deliver a yield of nearly 9%. Stable, consistent dividend growth also has a funny habit of portending strong performance in the underlying stock too.

Source: Forbes

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