Checked out current U.S. Treasury bond yields lately? If you loan the government money for 30 years, they will pay you a whopping 2.63% yield. After taxes and inflation, that probably works out to about a break-even proposition. Despite the wicked volatility in the markets, equities remain a far better place for most investors to be going forward, especially considering the depth of the sell-offs over the past six months. Yes stocks are expensive, but nowhere near as rich as Treasury debt.

We screened our Wall Street research database, and found four top companies that all yield right at 4% or better and offer investors solid growth potential and outstanding total return potential. All are rated Buy, and make good sense for patient growth and income investors.

AbbVie

This is one of the top global pharmaceutical stocks at Jefferies and is also on the franchise stock picks list. AbbVie Inc. (NYSE: ABBV) is a global, research-based biopharmaceutical company formed in 2013 following separation from Abbott Laboratories. Its 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. AbbVie employs more than 26,000 people worldwide and markets medicines in more than 170 countries

One of the biggest concerns with AbbVie is what might happen with anti-inflammatory therapy Humira, which generated $14 billion in sales in fiscal 2015. That $14 billion is the most any drug has recorded during a single year and represents a gigantic part of the company’s overall earnings. But biosimilars and generics are trying to enter the market, with Amgen leading the charge, and some Wall Street analysts project that AbbVie may have a difficult time stopping that trend. AbbVie has said it feels the patents they have are more than strong enough to protect the franchise.

The company reported mixed fourth-quarter numbers, but affirmed guidance, and some on Wall Street were concerned over a new hepatitis C drug from a rival company. Earnings were up 27% from the year-ago quarter and a penny over analysts’ consensus, according to Thomson Reuters. Revenue rose 18% but came in below estimates.

AbbVie investors receive an outstanding 4.18% dividend. The Jefferies price target on the stock is $80, among the highest on Wall Street. The Thomson/First Call consensus target is $72.25. Shares closed Thursday at $54.55.

GM

Shares of this automobile company look very inexpensive at current levels. Despite all the recall troubles and litigation issues, hedge funds and mutual funds are continuing to stick with General Motors Co. (NYSE: GM), as many view the stock as very undervalued. GM trades at an incredible 5.4 times estimated 2016 earnings. Like Ford, GM has benefited from incredible sales in China to boost revenue. It invested heavily in China decades ago and grabbed a big chunk of what is now the world’s largest auto market.

With the company facing continued possible punitive damages, there will continue to be a headline risk cloud over the stock. Long-term patient investors that can look beyond current issues may stand to make outstanding money on the auto giant, especially as oil and gasoline prices continue to push new buyers into showrooms.

The company reported very solid fourth-quarter earnings, and with gas prices staying the lowest in years, and GM producing some of the best new models in years, the future for the battered stocks looked very good.

GM investors receive a 5.24% dividend. The $44 Merrill Lynch price target is higher than the consensus target of $41.13. Shares closed Thursday at $29.03.
Pfizer

This one could be offering investors the best value at current trading levels. Pfizer Inc. (NYSE: PFE) has a very strong pipeline, and being the world’s largest drug manufacturer by sales value supports the Wall Street notion that it can generate higher long-term revenues through the accelerated growth of its new drugs over the next five years. The company announced recently the details in what would be one of this year’s biggest deals, a $160 billion merger with Allergan.

The Treasury Department announced recently that it is working on new rules for corporate tax inversions, which is potentially what the Pfizer/Allergan deal would be, and that could possibly throw wrench into the negotiations. Pfizer executives maintain that the government will not scuttle the deal.

Pfizer has announced that it is starting 20 clinical trials this year, and more soon after, on treatments to conquer cancer as it also seeks to gain leadership in one of the hottest, and most lucrative, areas of medicine. Pfizer currently has eight approved cancer medicines, four of them launched in the past four years. It is running late-stage patient tests on five of those drugs for additional uses and has three other drugs in late-stage testing, which is usually the last round before seeking regulatory’ approval. In addition, the company has 14 other drug programs in early stages.

Pfizer investors receive a 4.06% dividend. Merrill Lynch has a $39 price target. The consensus target is $39.13. Pfizer closed Thursday at $29.55.

Verizon

This top telecommunications company recently did away with some phone incentives and the stock resides on the Merrill Lynch US 1 list. Verizon Communications Inc. (NYSE: VZ) is a global leader in delivering the digital world. Verizon Wireless operates America’s self-described most reliable wireless network, with 109.5 million retail connections nationwide. Verizon also provides converged communications, information and entertainment services over America’s most advanced fiber-optic network, and it delivers integrated business solutions to customers worldwide.

Wall Street has applauded Frontier’s acquisition of Verizon’s wireline operations in California, Florida and Texas, which is expected to be completed at the end of March 2016. Many feel that focusing on the higher margin segments makes sense for Verizon, and the sale to Frontier is a huge cash boost to the balance sheet. The company reported solid fourth-quarter numbers with earnings slightly higher than the Merrill Lynch estimates and revenues right in line, but above the street consensus.

Verizon investors receive a 4.44% dividend. The Merrill Lynch price target is $55, while the consensus price objective is $50.71. Shares closed Thursday at $50.94.

For worried investors that need an income stream, all these top stocks make good sense for growth and income portfolios. The total return potential is solid, and the downside risk is far less than in momentum stocks. Plus, add in the still oversold status of the overall market, and the upside could be stellar for patient investors.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.