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Some S&P 500 stocks have benefited from the market's uptrend since March 2009 to raise their earnings and provide steady returns to their investors. Many of these high growth stocks have also increased their dividend yields in the last 3 years and now they are more attractive alternatives for defensive investors. As we are concerned about the Fed’s current monetary policy, we believe investors should--in the near future--seek some protection and pick defensive stocks with high dividend yields.

Below, we compiled a list of 18, large-cap, S&P 500 stocks with high dividend yields and high dividend growth rates over the last 3 years. The market data are sourced from Fidelity. All companies in this list didn’t cut their dividends in any single year since the end of 2008. These stocks have market capitalizations above $15 billion, annualized dividend yields between 3% and 4%, three-year annualized dividend growth rates of at least 4%.

Dividend Yield

3 Year Div. Growth (Annualized)

YTD Return

Phillip Morris International

PM

3.78%

5.83%

18.14%

Heinz Co.

HNZ

3.75%

4.97%

5.31%

Abbott Laboratories

ABT

3.74%

10.06%

10.06%

BlackRock Inc.

BLK

3.61%

20.80%

-18.24%

AFLAC Inc.

AFL

3.54%

7.72%

-38.76%

Johnson & Johnson

JNJ

3.53%

7.41%

7.32%

Travelers Company

TRV

3.38%

10.97%

-11.76%

Procter & Gamble

PG

3.37%

9.49%

-0.70%

Illinois Tool Works Inc.

ITW

3.32%

5.11%

-17.71%

General Mills Inc.

GIS

3.31%

12.36%

6.13%

PepsiCo Inc.

PEP

3.30%

6.61%

-2.19%

Chevron Corp.

CVX

3.26%

6.27%

7.23%

United Parcel Services Inc.

UPS

3.23%

4.94%

-9.37%

Kellogg Co.

K

3.21%

8.14%

7.17%

Public Storage

PSA

3.20%

19.98%

19.09%

Time Warner Inc.

TWX

3.13%

7.82%

-4.82%

Williams Cos Inc.

WMB

3.13%

22.05%

5.23%

General Dynamics Corp.

GD

3.12%

10.33%

-13.42%

AVERAGE

10.05%

-1.74%

Since the end of 2008, these 18, large-cap S&P 500 stocks didn't reduce their dividend payouts in any single year and their three-year annualized dividend growth is 10.05% on average. Since the beginning of this year, the average return of these 18 large-cap stocks was -1.74% vs. -6.10% for the SPY. Three stocks in this group – PM, ABT and PSA– provided double digit returns in 2011, while nine stocks provided a negative return in the same period.

Here are the top 10, highest dividend-yielding, large-cap, S&P 500 stocks on our list:

1. Phillip Morris International (NYSE:PM) is a large multinational company selling cigarettes worldwide. PM has a 3.78% dividend yield and returned 18.14% since the beginning of this year. PM raised its annualized dividend per share from $2.16 to $2.56 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 5.83%. PM has a market cap of $119.86B and P/E ratio of 15.65. Tom Russo holds more than 500 Million of PM. (see Russo’s top stock picks here)

2. Heinz Co. (NYSE:HNZ) is a US company providing food products worldwide. HNZ has a 3.75% dividend yield and returned 5.31% since the beginning of this year. HNZ raised its annualized dividend per share from $1.66 to $1.92 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 4.97%. HNZ has a market cap of $16.60B and P/E ratio of 17.18. Nelson Peltz’s Trian Partners had more than $100 Million in HNZ at the end of June 2011.

3. Abbott Laboratories (NYSE:ABT) is a leading healthcare company operating worldwide. ABT has a 3.74% dividend yield and gained 10.06% since the beginning of this year. ABT raised its annualized dividend per share from $1.44 to $1.92 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 10.06%. ABT has a market cap of $79.45B and P/E ratio of 15.61. Ken Fisher holds nearly $500 million of ABT (check out Ken Fisher’s favorite stocks).

4. BlackRock Inc. (NYSE:BLK) is a leading US investment management firm. BLK has a 3.61% dividend yield but lost -18.24% since the beginning of this year. BLK raised its annualized dividend per share from $2.42 to $5.50 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 20.80%. BLK has a market cap of $27.29B and P/E ratio of 12.71. John Paulson and Jonathon Jacobson hold large BLK positions in their portfolios.

5. AFLAC Inc. (NYSE:AFL) is an American company providing supplemental insurance services. AFL has a 3.54% dividend yield but lost -38.76% since the beginning of this year. AFL raised its annualized dividend per share from $0.96 to $1.20 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 7.72%. AFL has a market cap of $16.35B and P/E ratio of 9.16. Bill Miller had $120 Million in AFL at the end of June 2011 (see Miller’s other top stocks here).

6. Johnson & Johnson (NYSE:JNJ) is a large company that provides consumer healthcare and pharmaceutical products worldwide. JNJ has a 3.53% dividend yield and returned 7.32% since the beginning of this year. JNJ raised its annualized dividend per share from $1.84 to $2.28 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 7.41%. JNJ has a market cap of $175.57B and P/E ratio of 15.33. Warren Buffett is the most prominent JNJ investor with a $2.8 billion worth position.

7. Travelers Company (NYSE:TRV) is a US company providing insurance services. TRV has a 3.38% dividend yield but lost -11.76% since the beginning of this year. TRV raised its annualized dividend per share from $1.20 to $1.64 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 10.97%. TRV has a market cap of $20.46B and P/E ratio of 9.58. Mason Hawkins’ Southeastern Asset Management had more than $800M in TRV at the end of June 2011.

8. Procter & Gamble (NYSE:PG) is a multinational company providing a wide variety of consumer goods worldwide. PG has a 3.37% dividend yield but lost -0.70% since the beginning of this year. PG raised its annualized dividend per share from $1.60 to $2.10 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 9.49%. PG has a market cap of $171.89B and P/E ratio 15.92. Warren Buffett has the largest position in PG. Jim Simons, Ken Fisher, Bill Miller and D.E. Shaw also have large PG positions in their portfolios.

9. Illinois Tool Works Inc. (NYSE:ITW) is a US manufacturing company that provides industrial products and equipments worldwide. ITW has a 3.32% dividend yield but lost -17.71% since the beginning of this year. ITW raised its annualized dividend per share from $1.24 to $1.44 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 5.11%. ITW has a market cap of $21.46B and P/E ratio 11.52. Ric Dillon holds the largest ITW position among the 300-plus funds we are tracking.

10. General Mills Inc. (NYSE:GIS) is an American company that manufactures and sells branded food products worldwide. GIS has a 3.31% dividend yield and returned 6.13% since the beginning of this year. GIS raised its annualized dividend per share from $0.86 to $1.22 in the past three years. The stock has a 3-Year Annualized Dividend Growth of 12.36%. GIS has a market cap of $24.19B and P/E ratio 13.91. Ric Dillon holds more than $140 Million of GIS.

Disclosure: I am long PM.

Source: 18 Growth Stocks For Dividend Lovers