Top 10 Net Payout Yield Stocks For July 2014

by: Stone Fox Capital


Top net payout yield stocks underperformed the market in June.

The top ten net payout yield stocks average 11.5% yields for July.

Kohl's rejoined the list after an absence for several months.

This article is a continuation of a monthly series highlighting the top net payout yield (NPY) stocks that was started back in June 2012 (see article) and explained in August 2012 (see article). The series highlights the best stocks for the upcoming month. Please review the original articles for more information on the NPY concept.

June Returns

Below are two charts highlighting the monthly returns of the top ten stocks from June (see list here). Due to limitations with YCharts, the chart was broken into the Top 5 and Next 5 lists.

The Top 5 stocks had a rough June outside of Seagate Technology (NASDAQ:STX) that gained 5.6% for the month. All of the other stocks had negative returns that far underperformed the 2.0% gain of the benchmark S&P 500. Northrop Grumman (NYSE:NOC), CenturyLink (NYSE:CTL), and IBM (NYSE:IBM) had losses for the month of around 2.0%. A shocking loss of 13.0% came from the top yielder in Marathon Petroleum (NYSE:MPC).

MPC Total Return Price Chart

MPC Total Return Price data by YCharts

The Next 5 stocks had a solid month in June on the backs of a nearly 7% gain by Seadrill (NYSE:SDRL). In addition, Apple (NASDAQ:AAPL) exceeded the 2% gains of the S&P 500 index with a 3.5% return. Travelers (NYSE:TRV), Pfizer (NYSE:PFE) and Annaly Capital Management (NYSE:NLY) had basically flat returns for the month that underperformed the benchmark index.

SDRL Total Return Price Chart

SDRL Total Return Price data by YCharts

In all, the top ten stocks underperformed the market with on average a small loss due to the substantial drop in Marathon Petroleum. The month was tough for the high-yielding stocks with growth back in favor in the market overall. With the drop in Marathon Petroleum due to changes in regulations that could impact a domestic refiner, investors will need to key on whether the management team continues to aggressively pursue stock buybacks and capital returns to shareholders.

July List

The list encountered only a few minor changes since the last update, with Kohl's (NYSE:KSS) rejoining the list after an absence of a few months. The only stock removed from the list was Apple that saw no meaningful change in the yield with a slight drop to 9.7. The main reason for dropping off the list was Kohl's reporting an increased buyback for the last reported quarter.

The average yields were slightly higher with the NPY gaining to 11.5%. The main cause was the increase in the yield for Marathon Petroleum from 13.6% in June to the current 15.5% yield.


With the main indexes in the stock market roaring to new all-time highs, it is interesting to note that leading yielding stocks such as Marathon Petroleum, IBM, and Kohl's haven't seen comparable gains. That is a great sign that despite the market moves, individual stocks and sectors can provide great buying opportunities, as not all stocks gain when an index rises.

Disclosure: The author is long AAPL, CTL, KSS, NLY, NOC, SDRL, TRV. The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion or consult a financial advisor. Investing includes risks, including loss of principal.