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We like high dividend stocks because they tend to outperform the market when everything is going down. We also like dividend stocks because they beat the market in a low interest rate environment. We analyzed high dividend stocks between 1938 and 1950 when 10-year treasuries were yielding below 2.5%. During this time period high dividend stocks managed to beat the market by more than 5 percentage points per year.

Below, we compiled a list of 19-large cap stocks. These stocks have a market cap north of $10 Billion, a dividend yield of at least 4%, a P/E ratio of lower than 12, and a price-to-book ratio of less than 1.5.

Company name

Symbol

P/E ratio

Div yield (%)

Price to book

Return since June

Vodafone Group Plc (ADR)

VOD

10.78

5.54

0.96

-2.58%

Annaly Capital Management

NLY]]

6.19

14.85

1.14

-2.94%

Entergy Corporation

ETR

8.9

5.2

1.34

-5.26%

AT&T Inc.

T

8.4

6.15

1.48

-9.75%

ConocoPhillips

COP

8.25

4.01

1.41

-11.61%

Sun Life Financial Inc.

SLF

8.22

5.6

0.9

-12.34%

iShares MSCI Brazil ETF

EWZ

5.07

5.36

0.94

-13.13%

BP Plc

BP

5.78

4.53

1.22

-15.46%

HSBC Holdings plc

HBC

9.69

4.35

0.99

-15.84%

France Telecom SA

FTE

10.41

11.57

1.1

-15.98%

VimpelCom Ltd

VIP

7.67

16.85

1.29

-16.30%

Petroleo Brasileiro SA

PBR

6.82

4.46

1.34

-17.93%

SK Telecom Co., Ltd.

SKM

6.98

6.25

0.93

-17.97%

Banco Santander (Brasil)

BSBR

7.53

7.15

0.81

-19.04%

TOTAL S.A.

TOT

6.41

6.95

1.24

-19.66%

Eni S.p.A.

E

7.99

7.56

0.97

-19.71%

Banco Santander, S.A.

STD

6.03

10.51

0.65

-27.88%

Banco Bilbao Vizcaya Argentaria

BBVA

5.48

7.34

0.6

-30.43%

Credit Suisse Group AG

CS

8.38

6.07

0.75

-37.60%


Since the end of June, SPY suffered a loss of -9.80%. However, these 19 stocks perform even worse than the market with an average return of -16.39%. Only four of the stocks, VOD, NLY, ERT and T, outperformed the market. Most of the stocks that satisfied our criteria are foreign financials. These stocks’ prices are depressed partly because of the ongoing debt crisis in Europe. We believe the debt crisis is going to end up with the bankruptcy of at least Greece and maybe a major European bank. However, we still think that banking stocks are undervalued and they will probably get even cheaper when Greece defaults. We need to do our homework now and analyze these potentially cheap stocks so that we can buy them at the right price.

Here are the top 15 cheap high dividend stocks ranked by performance since the end of June:

Vodafone Group Plc (NASDAQ:VOD): Vodafone is a mobile communications company operating across the globe providing a range of communications services. VOD has a 5.54% dividend yield and returned -2.58% since the end of June. VOD has a market cap of $132.21B, a P/E ratio of 10.78 and a P/B ratio of 0.96. Boykin Curry holds the largest VOD position.

Annaly Capital Management (NYSE:NLY): Annaly owns, manages and finances a portfolio of real estate related investments. NLY has a 6.19% dividend yield and returned -2.94% since the end of June. NLY has a market cap of $17.18B, a P/E ratio of 6.19 and a P/B ratio of 1.14. Bill Miller holds the largest NLY position (see Miller’s favorite stocks here).

Entergy Corporation (NYSE:ETR): Entergy is an integrated energy company engaged primarily in electric power production and retail electric distribution operations. ETR has a 5.2% dividend yield and returned -5.26% since the end of June. It has a market cap of $11.05B, a P/E ratio of 8.9, and a P/B ratio of 1.34. Jean-Marie Eveillard holds the biggest ETR position.

AT&T Inc (NYSE:T): AT&T is a provider of telecommunications services in the United States and worldwide. T has a 6.15% dividend yield and returned -9.75% since the end of June. T has a market cap of $164.51B, a P/E ratio of 8.4, and a P/B ratio of 1.48. Phill Gross and Robert Atchinson hold the largest T position.

ConocoPhillips (NYSE:COP): ConocoPhillips is an international, integrated energy company. COP has a 4.01% dividend yield and returned -11.61% since the end of June. COP has a market cap of $92.39B, a P/E ratio of 8.25, and a P/B ratio of 1.41. Warren Buffett holds the largest COP position (see Buffett’s favorite stocks here).

Sun Life Financial Inc (NYSE:SLF): Sun Life Financial is an international financial services organization, offering a diverse range of life and health insurance, savings, investment management, retirement, and pension products and services to both individual and corporate customers. SLF has a 5.6% dividend yield and returned -12.34% since the end of June. SLF has a market cap of $14.86B, a P/E ratio of 8.22, and a P/B ratio of 0.9. Jim Simons holds the largest SLF position.

iShares MSCI Brazil Index (NYSEARCA:EWZ): iShares MSCI Brazil Index Fund seeks to provide investment results that correspond to the price and yield performance, before fees and expenses, of publicly traded securities in the aggregate in the Brazilian market, as measured by the MSCI Brazil Index. EWZ has a 5.36% dividend yield and returned -13.13% since the end of June. EWZ has a market cap of $10.72B, a P/E ratio of 5.07, and a P/B ratio of 0.94.

BP Plc (NYSE:BP): BP is an international oil and gas company, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products. BP has a 4.53% dividend yield and returned -15.46% since the end of June. BP has a market cap of $115.42B, a P/E ratio of 5.78, and a P/B ratio of 1.22. Kenneth Mario Garschina holds the largest BP position.

HSBC Holdings Plc (HBC): HSBC is a global banking and financial services organizations. HBC has a 4.35% dividend yield and returned -15.84% since the end of June. HBC has a market cap of $145.76B, a P/E ratio of 9.69, and a P/B ratio of 0.99. Mark Broach holds the largest HBC position.

France Telecom SA (FTE): France Telecom SA is a France-based telecommunications operator. FTE has an 11.57% dividend yield and returned -15.98% since the end of June. FTE has a market cap of $44.21B, a P/E ratio of 10.41, and a P/B ratio of 1.1. Steven Cohen holds the largest FTE position.

VimpelCom Ltd (NASDAQ:VIP): VimpelCom is a group of integrated telecommunications services operators. VIP has a 16.85% dividend yield and returned -16.30% since the end of June. VIP has a market cap of $16.86B, a P/E ratio of 7.67, and a P/B ratio of 1.29. John Kleinheinz holds the largest VIP position.

Petroleo Brasileiro SA (NYSE:PBR): Petrobras is a Brazilian integrated oil and gas company. It operates in five segments: exploration and production; refining, commercialization and transport of oil and natural gas; petrochemicals; distribution of derivatives, electrical energy, bio fuels and other renewable energy sources. PBR has a 4.46% dividend yield and returned -17.93% since the end of June. It has a market cap of $175.06B, a P/E ratio of 6.82, and a P/B ratio of 1.34. Sandy Nairn holds the biggest PBR position.

SK Telecom Co., Ltd (NYSE:SKM): SK Telecom is a Korea-based wireless telecommunications services provider. SKM has a 6.25% dividend yield and returned -17.97% since the end of June. SKM has a market cap of $10.96B, a P/E ratio of 6.98, and a P/B ratio of 0.93. Sandy Nairn holds the largest SKM position.

Banco Santander (NYSE:BSBR): Banco Santander Brasil is a full-service bank in Brazil. BSBR has a 7.15% dividend yield and returned -19.04% since the end of June. BSBR has a market cap of $34.70B, a P/E ratio of 7.53, and a P/B ratio of 0.81. Lee Ainslie holds the largest BSBR position.

Total SA (NYSE:TOT): TOTAL SA is a France-based integrated international oil and gas company. TOT has a 6.95% dividend yield and returned -19.66% since the end of June. TOT has a market cap of $102.48B, a P/E ratio of 6.41, and a P/B ratio of 1.24. Robert Rodriguez and Steven Romick hold the largest TOT position.



Disclosure: I am long VOD, T, COP, SPY.

Source: 15 Cheap High Dividend Yielding Stocks