These Are 2 of the Best Dow Dividends Today

The Dow Jones Industrial Average (DJINDICES: ^DJI  ) is packed to the rafters with great dividend stocks. Every one of the blue-chip index's 30 members pays a dividend, and the average yield sits at a generous 2.7%. Even better, the average Dow stock has increased its payout by 13.6% a year over the last decade.

But picking a dividend stock off the Dow isn't as easy at it might seem at first glance. The top yielders generally don't deliver strong dividend growth. The top growers often offer below-average yields. So what's a quality-hungry dividend investor to do?

Fortunately, two stocks hover near the pinnacle of Dow rankings for both high yields and fast dividend growth.

MCD Dividend Chart

MCD Dividend data by YCharts.

Image source: Intel.

Intel (NASDAQ: INTC  ) offers the third most generous yield on the Dow, clocking in at 3.8% today. It's also the second fastest long-term payout booster, having increased its dividend by an average of 27% per year over the last decade.

It's not all wine and roses for Intel investors, though. The latest payout increase happened in the summer of 2012, leaving an ugly flatline across the six most recent quarters. The company is battling a semiconductor market in a state of upheaval, conserving cash to defend traditional target markets and to push into the largely unexplored mobile sector.

As an Intel investor myself, I believe that rivals can't keep the chipmaker out of mobile computing forever. The company's unrivaled economies of scale will eventually win out. When that happens, Intel will be able to raise its dividends again -- perhaps even making up for lost time with an extra-generous first helping.

Buying Intel shares now would lock in a low cost base that should translate into very healthy effective dividends down the road.

Image source: McDonald's.

And then there's McDonald's (NYSE: MCD  ) . The fast-food vendor sits just behind Intel in terms of dividend growth, having pumped its payouts an average of 23% higher yearly over the last decade. The 3.5% dividend yield also ranks sixth among all Dow stocks.

McDonald's has increased its payouts without fail since the first dividend check was sent in 1976. That's an unbroken 38-year streak, and the Golden Arches aren't likely to break this shareholder-friendly tradition anytime soon.

Of these two dividend champions, Intel is a somewhat riskier choice but also offers the biggest long-term upside. That said, both stocks are proven winners. if you're looking for one of the Dow's best dividend payers, you can't go wrong by taking a closer look at McDonald's and Intel.

Finding a great dividend is half the battle
One of the dirty secrets that few finance professionals will openly admit is the fact that dividend stocks as a group handily outperform their non-dividend paying brethren. The reasons for this are too numerous to list here, but you can rest assured that it's true. However, knowing this is only half the battle. The other half is identifying which dividend stocks in particular are the best. With this in mind, our top analysts put together a free list of nine high-yielding stocks that should be in every income investor's portfolio. To learn the identity of these stocks instantly and for free, all you have to do is click here now.

Read/Post Comments (0) | Recommend This Article (6)

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.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2825180, ~/Articles/ArticleHandler.aspx, 9/4/2015 10:40:20 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Anders Bylund

Anders Bylund is a Foolish Technology and Entertainment Specialist. Where the two markets intersect, you'll find his wheelhouse. He has been an official Fool since 2006 but a jester all his life.

Hypoallergenic. Contains six flavors not found in nature. Believes in coyotes and time as an abstract.

Follow Anders on Twitter, LinkedIn, and Google+.

Today's Market

updated Moments ago Sponsored by:
DOW 16,148.74 -226.02 -1.38%
S&P 500 1,929.39 -21.74 -1.11%
NASD 4,697.55 -35.95 -0.76%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/4/2015 10:24 AM
^DJI $16148.74 Down -226.02 -1.38%
INTC $28.70 Down -0.39 -1.32%
Intel CAPS Rating: ****
MCD $95.28 Down -0.73 -0.76%
McDonald's CAPS Rating: ***