The Best Telecom Dividends on the S&P 500

At the end of every month Bloomberg releases a list of indicated dividend yield rankings for the S&P 500 (SPY) sorted by industry. It lists the yield and payout ratio for each stock within the industry, as well as the industry average. This month, like most months, the telecom industry carried the highest average yield at 7.02%. Utilities were second at 4.37% and actually offer a safer play than telecoms due to their stability and monopoly like status.Anyway, what’s disconcerting about the telecom industry is the high payout ratios. The industry average is 171.2%. This means that these companies, as a whole, are paying out $1.70 in dividends for every $1.00 of earnings. Many investors would argue that several of them have a long standing history of stable payouts so there is not much to... more

Dividend Scan: OZRK, DRI, EXE, LNCR, SE, MHR, GIM

Amidst the positive movement of the US market, several companies declared their future dividend plans. Some notable dividend payers are discussed here. Bank of the Ozarks, Inc. (Nasdaq: OZRK) raised its quarterly dividend by 5.6 percent to 19 cents per share. Shares added 0.83 percent or 43 cents to trade at $52.49. Darden Restaurants Inc. (NYSE: DRI) declared to hike its quarterly dividend by 34 percent to 43 cents per share. Shares added 4.72 percent or $2.35 to trade at $52.15. Shares of Crexendo Inc. (AMEX: EXE) were down 1.82 percent or 1 cent to trade at $4.94 despite declaring a quarterly dividend of 2 cents per share, payable on July 18, 2011 to shareholders of record on July 11, 2011. Lincare Holdings Inc. (Nasdaq: LNCR) declared a quarterly cash dividend of 20 cents per... more

Second-Quarter Dividend Champions

Why should you care about dividend payouts? According to Standard & Poor's, in the first quarter the amount of companies currently paying a regular cash dividend increased from 37.9% to 39.3%, but the overall yield paid to investors actually fell slightly, from 2.41% to 2.39%. This means it's getting harder to find quality dividend payers although the field of paying companies is increasing. Also, as fellow Fool Morgan Housel elaborates, stock buybacks are vastly outpacing dividend growth rates. A staggering 219 companies in the S&P 500 spent more on buybacks in the second quarter than they did on dividends. While you could easily argue that stock buybacks favor shareholders, I'd much rather have a guaranteed quarterly cash payment coming my way.... more

5 'Good' Stocks Raising Their Dividends

Virtually everything in this world can be placed into a few basic categories. This is especially true for Dividend Stocks when looking at their historic performance and expectations for the future. Consider these three broad categories: The Good: As you might guess, these are the dividend stocks that are doing exactly what they should do – consistently raising their dividends each year. The Bad: Companies that held their dividends flat. The Ugly: Companies that cut their dividends. Here are several companies in the 'Good' category that recently rewarded their shareholders with increased cash distributions:Worthington Industries, Inc. (WOR) operates as a diversified metal processing company focusing on steel processing and manufactured metal products. On June 29th the company... more

Top Stocks With High Dividend Growth Rates

Since the global financial turmoil had sunk share prices all over the world, the stock markets have rebounded almost 100% from its low point in March 2009. During this uptrend, many stocks took advantage of the dovish environment to raise their dividend payouts and provide steady returns to their investors. Many of these dividend growth stocks become appealing to dividend investors as they have also increased their dividend yields in the last 3 years. Considering the fact that the recent disinflation period won't last forever, many investors should play more defensively and pick the high dividend yielding stocks in near future. Below, we compiled a list of 16 large-cap U.S. stocks with high dividend yields and a high dividend growth in the last 3 years. The market data are sourced from... more

Three of the Best Dividend Investments in the World

When I was with a Wall Street firm, it was common for stockbrokers to mock investors who focused on income. Traditionally, income meant bonds… And in the old days many bonds came with coupons, which investors clipped and then cashed… And nothing was worse than being labeled a “coupon clipper.” But today, bond investors do have it even worse. One-year Treasuries yield nearly 0.19% right now. Meanwhile, inflation just hit 3.6%, according to the latest estimates from the Bureau of Labor Statistics. That means you’re actually losing purchasing power by “collecting income” from one-year Treasuries right now. So if you’re looking to add to your income portfolio, what’s an investor to do? Outperforming Bonds and More Stable Than High-Growth Stocks In a word:... more

Biotech Winners of a Repatriation Holiday

My Foolish colleague Morgan Housel had a good article yesterday about the pros and cons of a holiday on the repatriation tax that keeps companies from bringing foreign-earned funds into the U.S. without substantial taxation. Like Morgan, I'm all for it, although I have a hard time seeing it happen when politicians can't even agree to raise the debt ceiling. Still, a biotech Fool can dream, can't he? All that cash The big five American drugmakers have an outlandish amount of cash sitting on their balance sheets. The companies don't break out how much of the cash is held overseas, but it's safe to assume that it's a good chunk of the total. Even if they sell more drugs in U.S. than anywhere else, they're also using a lot of the stateside cash to pay for dividends to avoid the... more

Dell Pays Shareholders $2 Billion This Year

Dell is continuing its tradition this fiscal year. The company announced yesterday, in advance of today's annual analyst meeting, that it has repurchased $1.6 billion in stock this year and intends to purchase $400 million more by the end of this fiscal year, ending January 2012. That's a grand total of $2 billion, or the equivalent of paying a juicy 6.5% dividend for 2011. As a shareholder, I'm happy about this.... more

Dividends or Buybacks? The Story of How to Waste Shareholder Money

Some readers fired back: Dividends might be small, but for at least a few of these companies, buybacks are big -- and that's rewarding shareholders in ways similar to dividends. It's a fair point -- to a point. Some of these companies are providing real value through buybacks. Based on three-year average share buybacks, HP, for example, will repurchase its entire current market cap sometime within the next decade (based on current shares prices, of course). Things could turn disastrous, but in all likelihood these repurchases are a tremendous deal for shareholders.... more

Statoil's Dividend Is Safe

Here, we'll highlight a given company and its closest competitors to see just how safe their dividends are, with a little help from three crucial tools: The interest coverage ratio, or earnings before interest and taxes, divided by interest expense. The interest coverage ratio measures a company's ability to pay the interest on its debt. An interest coverage ratio less than 1.5 is questionable; a number less than 1 means that the company is not bringing in enough money to cover its interest expenses. The EPS payout ratio, or dividends per share divided by earnings per share. The EPS payout ratio measures the percentage of earnings that go toward paying the dividend. A ratio greater than 80% is worrisome. The FCF payout ratio, or dividends per share divided by free cash flow per... more