Dividend investing is popular again. Investors have taken to heart Jeremy Siegel's studies, which show that higher-yielding stocks tend to offer greater returns over time than low- or no-yield stocks.
The highest dividend yields can be very tantalizing. As long as a stock yielding 15% doesn't lose value, you'll make 15% in one year! In more cases than not, however, an astronomical yield is a bad sign for a stock. Since dividend yields and stock prices move in opposite directions, a high yield usually means that investors have begun to worry about the business, and driven down its stock price. However, certain types of companies, such as real estate investment trusts, have to pay out most of their income as dividends, so their yields will be higher than "normal." Dividends are not guaranteed; you need to make sure that a business is generating enough cash to pay its dividend, or your investment could be disastrous.
I've already screened for the 25 Highest-Yielding Dividend Stocks. Now, I'm touring the market to find the highest-yielding stocks in each industry. Today, we're looking at the integrated semiconductor industry and screening for stocks with a market cap greater than $500 million.
Here are the top 15 highest-yielding stocks the screen produced:
|
|
Company Name
|
Market Cap (in millions)
|
Dividend Yield
|
Payout Ratio
|
|
1
|
Siliconware Precision Industries (Nasdaq: SPIL )
|
$2,952.5
|
8.45%
|
56.7%
|
|
2
|
Maxim Integrated Products (Nasdaq: MXIM )
|
$4,821.0
|
5.14%
|
194.8%
|
|
3
|
Taiwan Semiconductor Manufacturing (NYSE: TSM )
|
$47,548.6
|
5.11%
|
56.0%
|
|
4
|
Microchip Technology (Nasdaq: MCHP )
|
$5,243.3
|
4.8%
|
89.9%
|
|
5
|
Intersil (Nasdaq: ISIL )
|
$1,280.3
|
4.66%
|
NM
|
|
6
|
STMicroelectronics (NYSE: STM )
|
$6,245.0
|
4.02%
|
99.3%
|
|
7
|
KLA-Tencor (Nasdaq: KLAC )
|
$4,800.0
|
3.44%
|
48.2%
|
|
8
|
Intel (Nasdaq: INTC )
|
$101,226.2
|
3.41%
|
34.8%
|
|
9
|
Linear Technology (Nasdaq: LLTC )
|
$6,556.2
|
3.12%
|
56.8%
|
|
10
|
National Semiconductor (NYSE: NSM )
|
$3,035.1
|
3.11%
|
36.2%
|
|
11
|
Analog Devices (NYSE: ADI )
|
$8,632.7
|
3.03%
|
40.9%
|
|
12
|
Applied Materials (Nasdaq: AMAT )
|
$14,141.6
|
2.61%
|
55.1%
|
|
13
|
Xilinx (Nasdaq: XLNX )
|
$6,336.2
|
2.57%
|
35.7%
|
|
14
|
Texas Instruments (NYSE: TXN )
|
$28,481.5
|
1.97%
|
22.3%
|
|
15
|
Micrel (Nasdaq: MCRL )
|
$569.1
|
1.5%
|
26.4%
|
Source: Capital IQ, a division of Standard and Poor's.
These stocks are a good place to start your research, but they're not formal recommendations. Remember, their seemingly irresistible yields could be ticking time bombs, so do your own due diligence. Also, make sure you diversify your picks across various sectors. As investors relearn every decade or so, you never want to put all your eggs in one basket -- no matter how tempting the dividends are.
Interested in any of these stocks? Hungry for more? If you want more thoroughly vetted suggestions, check out Jordan DiPietro's "The Best Dividend Stock. Period." or Jim Royal's "Dividend Play for a Lifetime."
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