Best High Yield Dividend Stocks for 2009, Q1 Update

Back in December 2008 several US and Canadian Bloggers provided four of their best stock picks for 2009. The rules of the stock-picking contest do not allow actively trading stocks. The performance of the individual bloggers’ picks is reviewed every quarter.

You might recall that I selected four high yielding dividend stocks from different sectors which I believed have sustainable dividend payments for 2009. Check out my original post for the rationale behind my picks.

Realty Income (O) closed 2008 at $23.15. At the current price of $18.82 plus the $0.42525 in distributions collected during the first quarter the investment in the owner of commercial retail real estate properties in the US is underwater by 16.90%. This dividend achiever, which has consistently increased its distributions multiple times/year since 1994, currently spots a very attractive 9.50% yield. Check out my analysis of Realty Income.

Kinder Morgan Energy Partners (KMP) finished 2008 at $45.75. At the current price of $46.72 plus the $1.05 in distributions collected during the first quarter the investment in the owner of energy transportation and storage assets in the US is up by 4.40%. This dividend achiever, which has consistently increased its distributions several times/year since 1997, currently spots a very appealing 9.00% yield. Check out my analysis of Kinder Morgan.

Consolidated Edison (ED) ended 2008 at $38.93. At the current price of $39.61 plus the $0.59 in dividends collected during the first quarter the investment in this provider electric, gas, and steam utility services has gained 3.30%. This dividend aristocrat, which has consistently increased its distributions several times/year since 1975, currently spots an attractive 6.10% yield. Check out my analysis of Consolidated Edison.

Phillip Morris International (PM) finished the year at $43.51. At the current price of $35.58 plus the $0.54 in dividends collected during the first quarter the investment in manufacturer of cigarettes and other tobacco products in markets outside of the United States of America is underwater by 17%. This dividend stock currently spots an attractive 5.60% yield.

Overall the four dividend stocks that I picked lost 8.30% so far in the first quarter of 2009; if you add in the dividends received over the first quarter of the year the total return improves to a negative 6.50%. In comparison S&P 500 lost 11.25% in the first quarter of 2009.

Check out the performance of the other bloggers year to date returns in the table below:

Rank

1 Intelligent Speculator 4.33%

2 The Financial Blogger -0.94%

3 FourPillars -2.67%

4 Million Dollar Journey -2.96%

5 Dividend Growth Investor -8.27%

6 WildInvestor -8.90%

7 Wheredoesallmymoneygo -21.77%

8 ZachStocks -24.19%

9 My Traders Journal -27.54%

I would like to reiterate the fact that in order to generate dividend income for the long run, a more diversified portfolio consisting of at least 30 stocks should be constructed. Check out the Best Dividend Stock for the Long Run list, which is a good addition to today's post.

Disclosure: Author is long ED, KMP, O, and PM

Comments

[Lightway:]

I'd expect that you would beat out the rest of the pack over time, so make the time frame 3 years, and you would be the clear winner. This is like tortoise vs. hare, they might beat you short term, and that is understood, but you still placed well considering your picks were income picks, and you're playing against players with more of a speculative/growth focus.

Nice work and thanks for posting your results.

Apr 01 10:18 PM

[Dividend Gr...:]

Lightway,

Thanks for your comment. You definitely hit the jackpot with the tortoise/hare comparison. Dividend investing is a long-term process. I strongly doubt that a time frame of less than 15 years is indicative of whether the performance is sustainable or not.


On Apr 01 10:18 PM Lightway wrote:

> I'd expect that you would beat out the rest of the pack over time,
> so make the time frame 3 years, and you would be the clear winner.
> This is like tortoise vs. hare, they might beat you short term, and
> that is understood, but you still placed well considering your picks
> were income picks, and you're playing against players with more of
> a speculative/growth focus.
>
> Nice work and thanks for posting your results.

Apr 02 03:09 AM

[notsosmart:]

con ed may have some problems in the future due to its very old infrastructure.any thoughts?

Apr 02 04:57 PM