The Daily Dividend: Money Made From Libya’s No-Fly Zone (RTN, LMT, BA, NOC, ATK)

It’s time for “The Daily Dividend” at 11:00 AM and today’s coverage is a bit different.  War is an awful thing to cover, particularly when you are talking about investing in defense companies.  The new no-fly zone mandated in Libya was not in analysts’  expectations for the industry, which has plenty of work to do in Iraq and Afghanistan.  They call it the military-industrial complex for a reason.  When it comes to investing for dividends, there are also some lucrative payouts for investors to be had.

Raytheon Co. (NYSE: RTN) makes Tomahawk cruise missiles, Patriot defense missiles, and more.  It pays $0.375 per quarter (same for a year) but has a history of hiking its dividends.  Its yield today is roughly 2.9% based on a $50.75 share price.

Lockheed Martin Corp. (NYSE: LMT) and Boeing Co. (NYSE: BA) are there for jets and other systems.  Lockheed hiked its dividend to $0.75 per quarter late last year and that generates a yield of 3.7% based upon its $81.40 share price.  As Boeing is so tied to private jets and so cyclical, its yield is lower with a 2.4% payout based on its $71.20 share price.  Boeing’s $0.42/quarter common payout has been the same for more than two-years now.

Northrop Grumman Corp. (NYSE: NOC) has the Global Hawk drones, laser systems, and more. Its $0.47 generates a yield of 2.8% and it has been the same for a year with a history of dividend hikes.

Alliant Techsystems Inc. (NYSE: ATK) has been one of the dividend laggards out there and is relatively new on the dividend front with a newly initiated $0.20 payout per quarter.  It pays only a 1.2% dividend yield and that is not very much considering Alliant is the largest maker of bullets in America.  Still, this is a start and it has enough in earnings to justify increased payouts through time.

We have admittedly skimmed over a lot here.  These companies are all much larger and make many more products that the brief list we have mentioned.  Not all are war-only defense companies as well.  We have also failed to mention Gaddafi  once, and his name is spelled so many different ways in public that we’ll just call him “that dictator.”

Investors often look for high-yield shares, and there are at least some high yields being paid that are likely to rise from the military-industrial complex.

JON C. OGG