Dividend Paying Stocks can Pay Monthly, Quarterly or Annually
Monthly dividend paying stocks are stocks that pay a monthly dividend instead of the typical dividend stocks that pay quarterly or yearly. A primary characteristic of monthly dividend paying stocks is even though they are traded on a regular stock exchange as individual stocks, monthly dividend stocks are basically from holding companies. Monthly dividends may also be held by trusts, master limited partnerships, REITs and/or a closed-end fund that has been invested through a portfolio of assets that produce income. Quarterly dividend paying stocks are typically sold through individual companies.
No Guarantee Implied for Dividend Paying Stocks
Dividend paying stocks offered through holding companies and other diversified investment portfolios are not a guarantee that they are the highest dividend paying stocks. However, since the income is derived through a variety of sources they tend to be less risky because of the diversification of built in income streams as opposed to owning dividend paying stocks in individual companies. A prime example of the risk held with individual companies as opposed to diversified risk is General Electric (GE). GE is a company that was once considered one of the most financially solid companies in the world, but it had an extensive dividend cut.
If you are considering becoming an income investor and investing in stocks with monthly, quarterly or yearly dividends, it is crucial that you do your homework. Research sites such as High Yield Dividend Stocks.com at http://www.high-yield-dividend-stocks.com/ to help you gauge the potential income from bonds, stocks or other assets that produce income that you are considering. For example, just considering the current value of dividend paying stocks is not a guarantee that the stock value and the dividends will not go down quickly. A good example is stock with oil producers – if the oil stock was one of the highest dividend paying stocks in 2010, it could go down in 2011 due to less global political turmoil, which will reduce the monthly dividend considerably.
Top Dividend Paying Stocks in 2010 also Top in 2011
Four out of the top ten dividend paying stocks for 2011 were also in the top ten dividend paying stocks of 2010. These four also have a long standing record as great dividend payers:
- Pfizer
- Philip Morris International
- Diageo
- Sysco
Two of the four, Phillip Morris and Diageo, are considered to be “sin stocks” in that they are companies who gain a major portion of revenue through products that are socially questionable, such as cigarettes and alcohol. These types of companies do typically pay higher dividends in order to attract as well as keep investors.
Top 10 Dividend Paying Stocks from MSN Money
Referencing MSN Money at http://money.msn.com/stock-broker-guided/top-managers-top-10-dividend-stocks-morningstar.aspx, the following are ten favorite dividend paying stocks picked by a variety of the best known stock pickers in the U.S. Also included are the price/fair values, dividend yields and number of funds holding (of 26) for each company:
- Eli Lilly Bristol-Myers Squibb – 0.95, 5.11% , 6
- Pfizer – 0.67, 4.36%, 10
- Philip Morris International – 1.03, 4.52%, 7
- Merck – 0.78, 4.44%, 6
- Diageo’s - 0.99, 3.02%, 7
- Kraft Foods - 0.93, 3.70%, 7
- Abbott Laboratories - 0.70, 3.75%, 7
- Sysco - 0.82, 3.42%, 6
- Johnson & Johnson – 0.80, 3.45%, 13
Picks for Highest Dividend Paying Stocks in 2012
Whiting USA Trust I (WHX) – Present Stock Cost – $17.16 – Pays 18.10% Dividend – Whiting USA Trust I is a REIT. The trust was founded in 2007 and is based in Austin, Texas. Whiting USA Trust I operates as a subsidiary of Whiting Petroleum Corp.
Annaly Capital Management, Inc. (NLY) – $18.31 – Dividend Yield – 14.20% – Annaly Capital Management, Inc., a actual estate investment trust, engages inside the ownership, management, and financing of a portfolio of investment securities. The enterprise invests primarily in mortgage pass-through certificates, collateralized mortgage obligations, agency callable debentures, as well as other mortgage-backed securities representing interests in or obligations backed by pools of mortgage loans.
Navios Maritime Partners L.P. (NMM) – $15.81 – Dividend Yield – 11% – Navios Maritime Partners L.P. owns and operates dry cargo vessels internationally. The firm engages inside the sea-borne transportation services of a range of dry bulk commodities, such as iron ore, coal, grains, and fertilizers, along with chartering of its vessels under medium to long-term charters. Its fleet consists of 10 Panamax vessels, 5 Cape size vessels, and 1 Ultra-Handymax vessel.
Frontier Communications Corporation (FTR) – $7.31 – Dividend Yield – 10.40% – Frontier Communications Corporation, a communications organization, delivers regulated and unregulated voice, data, and video services to residential, business, and wholesale clients within the United States. It delivers nearby and lengthy distance voice services, including basic telephone wire line services to residential and company customers