Dividends4Life: Safe High Yielders

Safe High Yielders

Posted by D4L | Wednesday, August 08, 2012 | | 0 comments »

Most people now recognize the power of dividend investing. Higher-yielding stocks tend to offer higher returns over time than low- or no-yield stocks, according to research from Jeremy Siegel and others. In fact, the 20 best-performing survivor stocks from the original S&P 500 in 1957 are all dividend payers. What's more, reinvesting dividends acts as a "bear-market protector and return accelerator," according to Siegel. The extra shares purchased and accumulated at higher dividend yields during down periods help protect portfolios in falling markets, and when these extra shares rise in value in good times, they accelerate returns.

I constructed a screen to find some promising high-yield, low-risk U.S. companies for further research. I made sure the stocks met the following criteria: Market cap > $1 billion, Payout ratio < 60% and Three-year dividend growth > 0%. Here are the top 10 highest yielders the screen produced: Pitney Bowes (NYSE: PBI), KKR Financial Holdings (NYSE: KFN), Hillshire Brands, Linn Energy (Nasdaq: LINE), Alliance Resource Partners, Cliffs Natural Resources (NYSE: CLF), Exelon (NYSE: EXC), Plains All American Pipeline, PPL and H&R Block.

Source: Motley Fool

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