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Our previous study showed that the average return of high dividend yielding stocks was 13.04% between 1927 and 2009. During that period, dividend stocks outperformed the market by an average of 1.36% per year. We are concerned about the Fed’s inflationary monetary policy and therefore recommend investors to play defensively by investing in high quality dividend stocks.

Here is a list of 11 large-cap companies with high dividend yields and low debt ratios. All stocks in our list have market capitalizations above $2 billion, Total Debt / Equity ratio of below 0.4, P/E ratio of below 15 and annualized dividend yields of at least 4%. The market data is obtained from Finviz.

Ticker

Company

P/E

Total Debt/Equity

Dividend Yield

YTD Return

TNH

Terra Nitrogen Co

13.21

0

7.43%

52.55%

DNP

DNP Select Income Fund

4.49

0.28

7.82%

15.80%

AT

Atlantic Power

5.26

0.23

7.67%

0.21%

COP

ConocoPhillips

8.1

0.33

4.10%

-2.94%

MCY

Mercury General

11.59

0.14

6.02%

-2.95%

BPT

BP Prudhoe Bay Royalty Trust

12.08

0

8.78%

-9.40%

RTN

Raytheon Co.

7.55

0.35

4.25%

-9.48%

CINF

Cincinnati Financial

14.92

0.17

5.96%

-11.21%

NYX

NYSE Euronext, Inc.

11.22

0.31

4.91%

-16.04%

RNO

Rhino Resource Partners

12.2

0.2

9.81%

-16.18%

SMS

Sims Metal Management

13.38

0

4.08%

-41.92%


Terra Nitrogen Company, L.P. (NYSE:TNH): Terra Nitrogen Company produces nitrogen fertilizer products.TNH has a dividend yield of 7.43% and returned 52.55% since the beginning of this year. It has a market cap of $2.83B, a P/E ratio of 13.21 and total debt to equity ratio of 0. Jim Simons just invested $3.4 million in the stock (see billionaire Simons’ top stock picks).

DNP Select Income Fund Inc. (NYSE:DNP): DNP Select Income Fund is a closed-end diversified management investment company. DNP has a dividend yield of 7.82% and returned 15.80% since the beginning of this year. It has a market cap of $2.40B, a P/E ratio of 4.49 and total debt to equity ratio of 0.28.

Atlantic Power Corporation (NYSE:AT): Atlantic Power Corporation owns and operates a diverse fleet of power generation and infrastructure assets in the United States. AT has a dividend yield of 7.67% and returned 0.21% since the beginning of this year. It has a market cap of $4.82B, a P/E ratio of 5.26 and total debt to equity ratio of 0.23. Jim Simons is the main holder of AT.

ConocoPhillips (NYSE:COP): ConocoPhillips is an international, integrated energy company. COP has a dividend yield of 4.10% and lost 2.94% since the beginning of this year. It has a market cap of $88.4B, a P/E ratio of 8.1 and total debt to equity ratio of 0.33. Warren Buffett held $2.8 billion in COP shares at the end of June (see Warren Buffett’s top stock picks). Jean-Marie Eveillard also had $438 million invested in COP shares.

Mercury General Corporation (NYSE:MCY): Mercury General is primarily engaged in writing automobile insurance in a number of states, principally California. MCY has a dividend yield of 6.02% and lost 2.95% since the beginning of this year. It has a market cap of $2.19B, a P/E ratio of 11.59 and total debt to equity ratio of 0.14. Jean-Marie Eveillard had $16 million of MCY stocks.

BP Prudhoe Bay Royalty Trust (NYSE:BPT): BP Prudhoe Bay Royalty Trust is a grantor trust formed for the purpose of owning and administering an overriding royalty interest. BPT has a dividend yield of 8.78% and lost 9.40% since the beginning of this year. It has a market cap of $2.31B, a P/E ratio of 12.08 and total debt to equity ratio of 0. Jim Simons had $20 million invested in BPT.

Raytheon Co. (NYSE:RTN): Raytheon Company is a technology company. RTN has a dividend yield of 4.25% and lost 9.48% since the beginning of this year. It has a market cap of $14.3B, a P/E ratio of 7.55 and total debt to equity ratio of 0.35. Ric Dillon also invested nearly $100 million in RTN.

Cincinnati Financial Corp. (NASDAQ:CINF): Cincinnati Financial Corporation is engaged in property casualty insurance. CINF has a dividend yield of 5.96% and lost 11.21% since the beginning of this year. It has a market cap of $4.41B, a P/E ratio of 14.92 and total debt to equity ratio of 0.17. Jean-Marie Eveillard had $336 million invested in CINF.

NYSE Euronext, Inc. (NYSE:NYX): NYSE Euronext is a global operator of financial markets and provider of trading technologies. NYX has a dividend yield of 4.91% and lost 16.04% since the beginning of this year. It has a market cap of $6.41B, a P/E ratio of 11.22 and total debt to equity ratio of 0.31. John Paulson invested more than $100 million in NYX stocks (check out Paulson’s top stock picks).

Rhino Resource Partners LP (NYSE:RNO): Rhino Resource Partners produces coal. RNO has a dividend yield of 9.81% and lost 16.18% since the beginning of this year. It has a market cap of $3.12B, a P/E ratio of 12.2 and total debt to equity ratio of 0.2. Charles Davidson invested over $200 million in RNO shares.

Source: 11 Strong Dividend Stocks With Low Debt And Low P/E Ratios