The dividend has become a favorite part of investing for much of the country. The announcement by tech-giant Apple (AAPL) that it would start offering its first dividend since the mid-1990s was just part of a trend that has some analysts openly pondering whether or not there’s a “dividend bubble” that’s pushing prices for dividend stocks higher than they should be.
However, regardless of whether or not they’re overpriced, the dividend’s appeal is clear. It’s money that’s guaranteed to the shareholder. Or, at least it’s as close to a guarantee as one can get on Wall Street. Barring a change in a company’s dividend policy, an investor can count on getting a return regardless of what happens to the share price. If a company’s offering a dividend of 5 percent, that’s a 5 percent return even if the share price plunges, paid in cash. If the share price spikes, there’s an additional 5 percent gain on the initial investment, paid in cash. An investor can more easily afford to hold a stock through tough times if they’re anticipating a rebound as well as bring in exponential returns over time with a DRIP (dividend reinvestment program). Dividends aren’t without their downsides. The decision to return company profits means the company isn’t investing those profits in the company and typically represents an admission that future growth may be more limited. But that hasn’t stopped many investors from taking the relative safety and reliability of dividend stocks while planning for their future.
So, what are the best dividends on Wall Street among those companies big enough that one can reasonably expect a certain degree of stability in their dividend program? Here are the five American companies with market caps over $10 billion offering the highest dividend yields available.
Energy Transfer Partners (ETP)
Market Cap: $10.35 billion Dividend Yield: 7.82 percent
This Dallas, TX-based comany specializes in propane and natural gas distribution.
Market Cap: $23.50 billion Dividend Yield: 7.65 percent
CenturyLink is a global broadband and telecom company based out of Monroe, LA.
Southern Copper Corporation (SCCO)
Market Cap: $25.66 billion Dividend Yield: 6.78 percent
Southern Copper is a copper mining company operating out of Phoenix, AZ.
The Blackstone Group (BX)
Market Cap: $17.93 billion Dividend Yield: 6.04 percent
Blackstone is an asset management company that has over $125 billion in assets under management.
Market Cap: $178.63 billion Dividend Yield: 5.84 percent
The telecom giant’s 5.84 percent annual dividend makes AT&T one of the strongest dividend stocks of the mega-cap family.