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Six dividend companies to add in your wallet
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Loading...1. McDonald’s is anything if not a survivor. In an industry in which consumer tastes can be particularly fickle, McDonald’s has managed to stay relevant for more than half a century by regularly updating its menu and changing with the times. And again today, McDonald’s blazing new trails with ordering via mobile apps and other technology changes.
At 2.5%, McDonald’s stock doesn’t sport as high of a yield as it used to, but that’s because the stock price is up by more than half in just the past two years.
2. Wallmart - This might be something of a contrarian pick, but I’d recommend instead the shares of retail giant Wal-Mart Stores Inc (WMT). Yes, I understand that traditional brick-and-mortar retail is dying a slow death. But Walmart is one of the few retailers out there that can reasonably expect to compete with Amazon, and WMT has made solid progress in building out its online infrastructure.
At current prices, Walmart yields a modest 2.6%. But this is a company that has raised its dividend for 44 consecutive years, and I don’t expect that chain to be broken any time soon.
3. JP Morgan - In the meantime, JPMorgan Chase & Co. (JPM) is probably your best bet for a safe and growing dividend. At current prices, JPM yields a respectable 2.3%. That’s not exceptionally high by any stretch of the imagination, but it puts JPM among the highest dividend yielders among major banks. And since 2012, JPM has raised its dividend by fully 73%.
4. Johnson and Johnson - All the same, I’m wary of the sector today. The Affordable Care Act (aka Obamacare) has a very uncertain future. Even if the republican plans to repeal it leave most of its core features intact, the uncontrolled surge in insurance premiums tell me that something has to give. And social media has made it difficult for Big Pharma companies to raise drug prices without risking a major backlash.
JNJ is one of only two companies in America that sports a AAA credit rating. Its yield, at 2.6%, isn’t exceptionally high. But this is also a company that has raised its dividend for 55 consecutive years, and I don’t expect that to change anytime soon.
5. General Electric - Today, GE is a safer, more conservative company, but it’s also a world leader in infrastructure, power systems, renewable energy, aviation and healthcare. More importantly, it has a new leader — John Flannery — who has the potential to turn around General Electric’s more recent underperformance.
At current prices, GE yields 3.4%, making it one of the highest-yielding dividend stocks in the S&P 500.
6. Apple - Though it only yields 1.7%, Apple has been a veritable dividend-raising machine, raising its dividend at a 10% annual clip for the past three years. Apples has also been extremely aggressive in repurchasing its shares, buying back 5.4% of its shares annually over the past three years.
Apple has been slapped around for a couple trading days as investors worry about slowing iPhone growth. I’d recommend using this mild pullback (and any others) as an opportunity to accumulate more shares.
Source: Bloomberg Pro Terminal
Jr Trader Petar Milanov
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