As we close in on the end of 2015, many of the top firms on Wall Street are fine-tuning the top picks list of stocks to buy that they present to their top institutional and high net worth investors. With the first Federal Reserve increase in interest rates in over eight years likely to happen this month, we wanted to find high-dividend stocks lurking among the other picks on the top lists.

We screened the Jefferies Franchise Picks list for the high-yielding dividend members. Any Wall Street firm that feels comfortable leaving dividend payers among their top picks must feel very good about the companies. It’s also important to note that the increase in fed funds rate is expected to be a very small 25 basis points, or a tiny one-quarter of 1%.

AbbVie

This is one of the top global pharmaceutical stocks at Jefferies, and it is also on the franchise stock list. AbbVie Inc. (NYSE: ABBV) is a global, research-based biopharmaceutical company formed in 2013 following separation from Abbott Laboratories. The company’s mission is to use its expertise, dedicated people and unique approach to innovation to develop and market advanced therapies that address some of the world’s most complex and serious diseases.

The stock fell 10% in late October after the FDA warning about liver risk with the company’s hepatitis C (HCV) products. However, Jefferies points out that this applies to a small sub-population of cirrhotics who are 3% to 5% of the total patient population. Additionally, the next generation HCV product could be launched as early as 2017, and even of the entire Viekira Pak/Technivie business were lost over the next two years, it represents only 4% of net percentage value.

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Recently, AbbVie announced a five-year growth plan that is very shareholder friendly. The company predicts total sales of about $37 billion in 2020, reflecting roughly 10% average sales growth over the next five-year period. For the third quarter, the company reported a profit of $1.24 billion, a significant increase from the $506 million it earned in the same quarter of 2014. The company’s sales increased by 8.40% year-over-year to $5.94 billion.

AbbVie investors receive a solid 3.8% dividend. The Jefferies price target is at $85, among the highest on Wall Street. The Thomson/First Call consensus target is just $75.29. Shares closed Friday at $60.

AT&T

AT&T Inc. (NYSE: T) posted very solid third-quarter numbers, and many on Wall Street think the fourth quarter will be good as well. It is the world’s largest provider of pay TV, with customers in the United States and 11 Latin American countries. In the United States, the AT&T wireless network has the nation’s self-described strongest 4G LTE signal and most reliable 4G LTE. AT&T also helps businesses worldwide serve their customers better with mobility and highly secure cloud solutions. Trading at a very cheap 11.7 times estimated 2016 earnings, the company continues to expand its user base, and strong product introductions from smartphone vendors have not only driven traffic, but increased device financing plans.

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AT&T posted outstanding third-quarter results and reiterated 2015 guidance for double-digit revenue growth and continued consolidated margin expansion. Management expects capital spending to increase sequentially and they also estimate that free cash flow could be better than $4.5 billion. Third-quarter wireless subscriber additions came in higher than many Wall Street estimates, and DirecTV saw positive video additions where many expected losses.

AT&T investors receive an outstanding 5.6% dividend. The Jefferies price target for the Buy-rated stock is $40, and the consensus estimate is at $37.12. Shares closed Friday at $33.57.
Boeing

This top aerospace industrial has just now returned to levels where it was trading before the summer sell-off. Boeing Co. (NYSE: BA) has been on a downward trend since February and now may be ready to perk up. The company together with its subsidiaries, designs, develops, manufactures, sells, services and supports commercial jetliners, military aircraft, satellites, missile defense, human space flight and launch systems and services worldwide.

Jefferies has increased confidence in continuing good demand and notes that Boeing recently has made announcements that support the analyst’s thesis the productivity and margins will continue to improve. 787 execution is good as the company works through the backlog, and cash flow looks to be strong with 787 deliveries and C-17 orders. Some Wall Street analysts also point to low oil prices as a bullish indicator for the top carriers who are Boeing’s big customers.

Boeing investors receive a solid 2.5% dividend. The Jefferies price target is $185, and the consensus target is $162.83. The shares closed on Friday at $146.95.

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Western Digital

This leader in the total addressable hard disk drive (HDD) market is a long-time innovator in the storage industry. Western Digital Corp. (NASDAQ: WDC) is an industry-leading developer and manufacturer of storage solutions that help to create, manage, experience and preserve digital content. It is responding to changing market needs by providing a full portfolio of compelling, high-quality storage products with effective technology deployment, high efficiency, flexibility and speed. Its products are marketed under the HGST and WD brands.

The most compelling news is that the company made a stunning $19 billion purchase of SanDisk. This could be a strong addition to the Western Digital current offerings, and it could significantly benefit from SanDisk’s technology and portfolio leadership in the NAND flash semiconductor and enterprise flash systems market.

The drop off in the PC business helps to spur initiatives in the company’s cloud business, and analysts estimate that the company’s gross profit contribution from Business Critical (cloud) drives will exceed that of PCs by the second half of next year. Of all the stocks beaten down due to the poor PC environment, Western Digital may have the most upside potential. Jefferies notes that in 2016, enterprise HDDs will have an average three-year cost of $100 per year versus $500 for NAND.

Investors are paid a very plump 3.25% dividend. Jefferies has a $95 price target, and the consensus figure is higher at $97.59. Shares closed Friday at $61.73.

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Buying high-yielding blue chips for 2016 makes good sense. The Federal Reserve interest rate increases over the next two years are expected to remain very small and very measured. These top companies give investors excellent total return potential, and none are trading at overheated valuations.

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