With the maximum tax on dividends lowered to 15%, more than 100 of the S&P 500 companies have upped their payouts this year. Ethan Allen (NYSE:ETH), for example, increased its dividend by 43%. Other firms, without hiking dividends, offer compelling yields due to their stocks being beaten down in the bear market.
Here are a bunch of big companies trading with intriguing dividend yields. Keep an eye on those that interest you, and you may see their dividends hiked further: ALLTEL (NYSE:AT), BB&T Corp. (NYSE:BBT), Citigroup (NYSE:C), Dominion Resources (NYSE:D), EniS. p. A. (NYSE:E)*, Exelon (NYSE:EXC), ExxonMobil (NYSE:XOM), Fannie Mae (NYSE:FNM), Fifth Third Bankcorp (NASDAQ:FITB), Freddie Mac (NYSE:FRE), ING Groep (NYSE:ING)*, Marsh & McLennan (NYSE:MMC), Merck (NYSE:MRK), RepsolYPF, S.A. (NYSE:REP)*, Royal Dutch Petroleum Co. (NYSE:RD)*, Shell Transport & Trading Co. (NYSE:SC)*, Total S.A. (NYSE:TOT)*, U.S. Bancorp (NYSE:USB), Washington Mutual (NYSE:WM), Wells Fargo (NYSE:WFC).
The list was assembled using the stocks screener at Hoovers Online (subscription required). Try some screening on your own sometime -- perhaps with Yahoo!'s screener.
Below are some stats for the firms highlighted above. The following abbreviations are used: P/E = price-to-earnings ratio; ROE = return on equity; MC = market capitalization, in billions; 5-yr RG = five-year average revenue growth. An asterisk flags foreign companies that trade in the U.S. as ADRs (American Depositary Receipts).
Ticker Yield P/E ROE MC 5-yr RG
AT 2.9% 12.5 15.7% $15 9.4%BBT 3.7 12.7 17.5 17 11.8C 3.1 16.1 18.0 236 9.2D 4.3 12.6 13.3 19 11.9E 5.2 12.1 17.5 61 9.3EXC 3.3 10.8 21.6 18 30.1XOM 2.8 15.2 15.4 239 12.4FNM 2.8 12.2 33.9 63 13.5FITB 2.1 19.8 19.3 32 25.8 FRE 2.1 6.3 40.6 35 22.1ING 5.0 10.7 24.7 39 15.1MMC 2.5 19.5 27.2 27 8.3MRK 2.6 17.4 39.3 127 16.2REP 2.0 7.9 14.4 19 14.9RD 6.0 11.8 15.7 93 14.8SC 4.2 12.5 15.7 62 10.6TOT 2.9 13.9 18.5 103 34.6USB 3.3 13.4 18.4 48 47.5WM 3.5 9.9 19.4 39 13.3WFC 3.5 15.3 18.8 87 16.7
Remember, you should never invest exclusively because of a tasty dividend. Often, outsized dividends are a sign of trouble. In other words, these numbers must be examined in context -- for example, is ROE high due to excessive leverage? Learn more about dividends in this Bill Mann article and in this one by Jeff Fischer.
