Dividend Yield Update

Dividend News

Companies with profits reward shareholders by paying dividends to owners of the stock. The dividend yield of a stock indicates to the potential investor the yield they can expect at the current stock price and dividend payout. The dividend yield changes when the price of the stock goes up (yield increases) or when the price goes down (yield decreases). Resources to find stocks which pay dividends include this list of dividend yields for Dow Jones Industrial Average stocks and this list of dividend yield for S&P 500 stocks.

Three blogs which report on dividends are The Dividend Guy Blog, Dividend Money, and Bank Savings and Investing Blog.

Dividend Stocks of Interest

The Savings Investor likes stocks which reward investors by paying a consistent dividend and meet our filters of growth, market capitalization, volatility, and earnings. Some stocks of interest include:

Cedar Fair LP (FUN), 8.09% yield, amusement and water park operator has traded in narrow range between 21 and 30 for two years

Pfizer (PFE), 4.68% yield, prescription-maker conglomerate has long history of rewarding investors with strong dividends

Companies included in the S&P 500 which pay strong dividends include:

New York Times (NYT) - 5.05% yield

Integrys Energy Group (TEG) - 4.98% yield

Ameren (AEE) - 4.69% yield A

ltria (MO) - 4.22% yield

Verizon (VZ) - 3.79% yield

Bristol Myers Squibb (BMY) - 3.77% yield

AT&T (T) - 3.36% yield

Merck (MRK) - 2.84% yield

Bank Stocks with Strong Dividend Payouts

Banks traditionally have been one of the best sectors for finding dividend-paying stocks. The five largest banks in the country all pay dividends and trade with yields comparable to U.S. Treasuries or other fixed-income securities:

Citigroup (C) 4.89% yield

Bank of America (BAC) 5.31% yield

JP Morgan Chase (JPM) 3.32% yield

Wachovia (WB) 5.38% yield

Wells Fargo (WFC) 3.69% yield

Bank stocks have showed less volatility than other sectors while maintaining a history of rewarding shareholders. Banks on average distribute close to 50% of their profits in dividends and another 20% in stock repurchase programs. In addition, banks generally trade at a lower multiple to future earnings than the S&P 500, NASDAQ, or Dow Jones Industrial Average as a whole. The stocks for the five largest banks in the country (listed above) all trade with a Price-to-Earnings ratio of less than 15:

Citigroup (C) 10.47 p/e

Bank of America (BAC) 10.02 p/e

JP Morgan Chase (JPM) 9.45 p/e

Wachovia (WB) 9.64 p/e

Wells Fargo (WFC) 13.06 p/e

Other banks with attractive dividend yields and Price-to-Earnings ratios of below 25 include:

Key Corp (KEY)
4.99%
9.53

Washington Mutual (WM)
7.20%
9.69

Huntington Bancshares (HBAN)
6.26%
9.62

National City (NCC)
6.97%
7.13

Corus Bancshares (CORS)
9.05% yield
3.81 p/e

US Bancorp (USB)
4.96% yield
12.27 p/e

Fulton Financial (FULT)
4.92% yield
13.25 p/e

Fifth Third Bancorp (FITB)
5.50% yield
14.41 p/e

Regions Financial Corp (RF)
5.59% yield
10.67 p/e

United Bancorp
(UBCP)
5.04% yield
18.43 p/e

Beverly Hills Bancorp (BHBC)
8.83% yield
8.09 p/e

New York Community Bancorp (NYB)
5.50% yield
24.88 p/e

Bank Stock Analysis Blog