The Highest Yielding Stocks On The S&P 500 You Should Buy

With interest rates still low, investors continue to search for yield wherever they can find it. I look for stocks that have a nice yield today but are also in a position to continue increasing future dividend payments. In general, I look for the following key attributes:
A low payout ratio, which means a company has capacity to sustain and increase dividend payments. Unsustainable payout ratios often result in dividend cuts, which normally are perceived negatively by the market. Projected earnings growth, which should help drive payout ratios down and help sustain increasing dividend payments. A healthy balance sheet. If payout ratios are too high, I look to see how a company has been making payments, which is usually from cash reserves or increasing debt. I especially hate it when a company increases debt to finance dividend payments. Today, I analyzed the S&P 500's top 10 dividend yielding stocks.
CenturyLink (NYSE: CTL) - 8.60% Mattel (Nasdaq: MAT) - 6.73% Macy's (NYSE: M) - 6.40% Iron Mountain (NYSE: IRM) - 6.27% Seagate Technology (Nasdaq: STX) - 5.85% Kimco Realty (NYSE: KIM) - 5.50% Ford (NYSE: F) - 5.49% Staples (Nasdaq: SPLS) - 5.19% AT&T (NYSE: T) - 5.10% Kohl's Corporation (NYSE: KSS) - 5.08% Based on my analysis in the table below, I recommend buying CenturyLink, AT&T, and Kimco Realty (in no specific order). Each of these stocks produces enough free cash flow to sustain their dividend payments going forward. I also consider each of these... Read more