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Thursday, January 19, 2012

The Highest-Yielding Stocks in the Dow Jones Industrial Average

Source: Capital Pixel
The Dow Jones Industrial Average (DJIA) is the most quoted stock average among followers of the markets.  "Where's the Dow?" is the question people ask when they want to know how the market is doing.  The average is comprised of 30 stocks and has been used since 1896 to track the market.

Most market participants are somewhat familiar with the DJIA, but how many can name the highest-yielding stocks in the average?  And what is the yield on the highest yielders?  This is especially interesting today because, for the first time in decades, the dividend yield on market indices is above the yield on Treasury bonds--which has led many to rethink the whole bond allocation question.

In any event, these questions are readily with a neat table I found on The Dynamic Dividend blog listed in the "Weekly Reading" list on the Dividend Pig's blog.

Here's the first part of the table:

Source: The Dynamic Dividend
CLICK TABLE TO ENLARGE,/b> As you look at the yields, recall that the yield on the 10-year Treasury note is slightly below 2%! Furthermore, the payout on the Treasury is fixed for the next 10 years; whereas many dividend payers increase their payout.  In fact, one of the really good reasons to follow the dividend bloggers (as I call them) is that they do great analysis to identify those companies likely to increase dividends.

Be sure to visit Dynamic Dividend to see the compete list and follow its updating, especially if you are looking for ideas among dividend payers.
Posted by Robert Wasilewski at 11:48 AM
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4 comments:

  1. MoneyConeJanuary 19, 2012 at 1:51 PM

    Telecom and pharma hogging the top spot, not surprisingly!

    ReplyDelete
  2. Financial IndependenceJanuary 20, 2012 at 3:43 AM

    I was thinking why AT&T stock is selling so low that it pays nearly 6%, while Pfizer is only 4%...is it because it is premium for risk?

    Risk is here, with us..so there is a plausible chance to lose some or all of the money. Otherwise everybody would be in AT&T : -)

    Just a thought of mine.

    ReplyDelete
  3. The GrouchJanuary 20, 2012 at 4:15 PM

    Sounds like a variation on Dogs of the Dow. But let's face it. Telecom's growth prospects are dim to non-existent (let's hope their profits don't begin to shrink as technology becomes cheaper and cheaper) so they may be a bond substitute with more risk. Big Pharma has the problem of having to constantly invent new drugs which takes a lot of money and brainpower. I'd rather sacrifice a little on yield to invest in dividend payers that require less brain power just to tread water.

    ReplyDelete
  4. Roshawn @ Watson IncJanuary 24, 2012 at 1:01 AM

    Thanks for the reminder to continue checking the yields. Less than 2% on the Treasury is just disgusting.

    Just think, a little less than 4 years ago, even online savings accounts were at 5%. Oh well, the "good old days!" :)

    ReplyDelete

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