Just as in the story of the tortoise and the hare, value investors likely believe that slow and steady will win the race. A steady (and steadily rising) dividend will beat a high-flyer over the long run every time.
Maybe. Maybe not. Since late June of 2010, the S&P 500 index has gained 226%. Not bad. General Electric, one of the oldest stocks around, has dropped 41% over the same period. Electric vehicle maker Tesla, which came public on June 29, 2010, had added more than 10,000% to its share price, before giving back more than 20% of that gain earlier this week.
Is it time to look again at some long-term, slow-and-steady stocks instead of chasing the next rocket? While ditching all the high-flyers may be a little hasty, there are some solid dividend payers out there that could have a place in a balanced basket of investments.
Here are eight stocks worth considering adding to the value basket. We’ve noted a stock’s history of dividend increases, its current dividend yield and how the stock has performed over the most recent 12 quarters.
AbbVie Inc. (NYSE: ABBV) was spun out of Abbott Labs in 2012 and paid its first quarterly dividend of $0.40 a share ($1.60 annualized) in January of 2013. The dividend has increased by a cumulative 195%, until reaching its current annualized rate of $4.72. AbbVie’s market cap is around $162.5 billion, and the stock’s dividend yield is 5.32%. Over the past 12 quarters, AbbVie has paid $12.05 in cash dividends and the share price has added $26.12.
AT&T Inc. (NYSE: T) has raised its dividend every year for the past 35 years. The company’s market cap is currently around $210.4 billion, and its current annualized dividend is $2.08 yielding 7.05%. Over the past 12 quarters, AT&T has paid out $6.09 in cash dividends and the share price has dipped by $1.90.
International Business Machines Corp. (NYSE: IBM) has paid out consecutive quarterly dividends since 1916. The company’s market cap is about $109 billion, and its current annualized dividend is $6.52 (yield of 5.38%). Over the past 12 quarters, IBM has paid $20.27 in cash dividends and the share price has dipped by $2.77.
PPL Corp. (NYSE: PPL) has raised its dividend every year for the past eight years and in 18 of the past 19. The utilities holding company has a market cap of about $21.5 billion and pays a cash dividend of $1.66 (yield of 5.88%). In the past 12 quarters, PPL has paid out $5.31 in dividends and the share price has dropped by $5.20.
Altria Group Inc. (NYSE: MO) has a market cap of about $82 billion and targets a dividend payout ratio of 80%. The current annualized cash dividend is $3.44 (yield of 7.91%). Over the past 12 quarters, the Marlboro cigarette maker has paid cash dividends totaling $9.28. Over the same period, the share price fell by $8.79. The company has increased its dividend every year for 11 years.
Chevron Corp. (NYSE: CVX) has increased its dividend for 32 consecutive years. The oil and gas giant’s market cap is about $150 billion, and it pays an annual dividend of $5.16 (yield of 6.53%). Over the past 12 quarters, Chevron has paid $13.98 in cash dividends, while the stock’s share price has decreased by $16.24.
Philip Morris International (NYSE: PM) has a market cap of $126.1 billion and pays a just-raised annualized dividend of $4.80 (yield of 5.96%). Like Altria, Philip Morris has raised its dividend for 11 consecutive years. The maker and marketer of Marlboro cigarettes for the international market paid $13.98 in cash dividends over the past 12 quarters. The stock price fell by $19.11 in that time.
Walgreens Boots Alliance Inc. (NYSE: WBA) has raised its dividend for the past 44 consecutive years. The drug store operator has a market cap of about $30.8 billion and currently pays an annualized dividend of $1.87 (yield of 5.18%). Walgreens has paid cash dividends totaling $5.60 over the past 12 quarters, but the share price has tumbled by $38.62 in that time.
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