This High-Yield Dividend Portfolio Will Beat the Market

Forty-one weeks ago, I invested my cold hard cash into 10 high-yield dividend stocks I believe will beat the market. Let's see the results so far:


Average Cost


Recent Price

Total Value


Altria (NYSE: MO  ) $24.86 40 $28.69 $1,147.60 15.41%
Philip Morris (NYSE: PM  ) $61.83 17 $76.24 $1,296.08 22.36%
National Grid (NYSE: NGG  ) $45.63 22 $49.42 $1,087.24 8.31%
Annaly Capital Management (NYSE: NLY  ) $17.55 57 $16.07 $915.99 (8.43%)
Frontier Communications (NYSE: FTR  ) $8.71 149 $5.72 $852.28 (34.33%)
Southern Co (NYSE: SO  ) $37.87 26 $43.91 $1,141.66 15.95%
France Telecom (NYSE: FTE  ) $22.23 45 $17.27 $777.15 (22.31%)
Vodafone Group $28.69 38 $27.15 $1,031.70 (5.37%)
Eli Lilly $34.48 29 $37.85 $1,097.65 9.77%
Bristol-Myers Squibb $25.37 39 $32.72 $1,276.08 28.97%
Cash   20.01   20.01 0%
Dividends Receivable   26.5   50.62 0%
Total Portfolio       $10,694.06 6.94%
Investment In SPY         (3.81%)
Return vs SPY (percentage points)         +10.75

Source: S&P Capital IQ, as of Nov 30.

Since my last report, the SPDR S&P 500 has risen a sharp 7.3%. Our portfolio rose slightly less, with our outperformance moving from beating the market by 10.97 percentage points to a 10.75 point advantage. While outperformance is always good, it should be taken with a grain of salt. We're investing for the long term, and it's only been nine months.

Movers and shakers
Similar to last week, of our stocks the biggest mover in the portfolio was France Telecom. This time however, it rose 10.9% instead of falling 9.3%.

There are five upcoming dividends for the portfolio:

  • Southern Company will pay a dividend of $0.4725 per share on Dec. 6. The ex-dividend date was Nov. 3.
  • Eli Lilly will pay a dividend of $0.49 per share on Dec. 9. The ex-dividend date was Nov. 10.
  • Frontier will pay a dividend of $0.1875 on Dec. 30. The ex-dividend date is Dec. 7.
  • National Grid will pay a dividend of $1.09 on Jan. 18. The ex-dividend date was Nov. 30.
  • Vodafone will pay a dividend of 0.705 pence (roughly $1.12, not included in Dividends Receivable as the exchange rate won't be determined until Jan. 20) on Feb. 3. The ex-dividend date was Nov. 16.

My Foolish bottom line
I'm highly confident in this portfolio's ability to crush the market over the next decade, and that's why I put $10,000 of my personal cash into these stocks. My strategy is simple. I'm buying strong companies with outsized dividends, reinvesting those dividends, and holding them for the long run. Over the coming year, I'll track my performance, update you on when I'm going to reinvest all my dividends, and keep you abreast of news affecting these companies.

Consider the 10 tickers above along with the 11 names from a brand new free report from Motley Fool's expert analysts called "11 Rock-Solid Dividend Stocks." To get instant access to the names of these 11 dividend stocks, click here -- it's free.

Dan Dzombak can be found on his Twitter account: @DanDzombak. He owns shares of Altria, Philip Morris, National Grid, Annaly Capital, Frontier, Southern Co., France Telecom, Vodafone, Eli Lilly, and Bristol-Myers Squibb.

The Motley Fool owns shares of Altria Group, Chimera Investment, Philip Morris International, and Annaly Capital Management. Motley Fool newsletter services have recommended buying shares of Southern, France Telecom, Philip Morris International, Vodafone Group, and National Grid. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (3) | Recommend This Article (15)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 02, 2011, at 11:07 AM, keesluijt wrote:

    to bad NGG lowered their dividend! I bought the stock last year because of the teh $3 dividend, thats been slashed to $2,19.

    And how about FTR dividend, how safe is that in your eyes? I own FTR also for almost 2 years now, but the stock price has slumped immensely, and the dividend future is also unsure..

    NLY (also in my bucket) will look good until mid 2013, but if the Fed decides to up interestrates, the stock will also go down (which it has already, despite the current climate)

    Any suggestions on these stocks anyone?

  • Report this Comment On December 02, 2011, at 11:58 AM, SPYDERMAN23 wrote:

    The $2.19 dividend is misleading. The dividend on an annual basis is still $3. NGG pays semiannual dividends in June and Nov/Dec. Looking at the payment history, the June dividends is always nearly double the Nov payment. The 2011 dividend is $2.998 per share which repesents the largest annual dividend NGG has ever paid - same as 2008. So it's not simpy a matter of doubling the Nov 2011 dividend of $1.097 to get $2.19. I expect the dividends to continue to bw in the high $2 to $3 range and I think the company will perform well over the next 12 months.

  • Report this Comment On December 03, 2011, at 5:30 AM, keesluijt wrote:

    @spyderman23: absolutely right about div NGG! My mistake, I always "forget" how the div for these semiannuals is written down. Thanks!

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