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Dividend yield, like other value metrics, will appear attractive for stocks that are suffering. Investors seeking top dividend yields will have to embrace the out-of-favor stocks that most investors wouldn’t touch. This is a lot like dumpster diving: you can find treasure out there, but most of the stuff you find in the trash is crap.

Five dividend stocks with massive 8% dividend yields met the following criteria for quality:

1) Historical dividend growth. The firm returns capital directly to shareholders, enabling them to benefit from their investment regardless of market sentiment.

2) Positive return on equity over the last ten years. This includes any losses in recent times of distress, and demonstrates how the firm builds shareholder wealth in the long term.

The following stocks pay 8% or higher dividends and meet these criteria for a long term commitment to shareholder income and wealth:

CPI Corp. (NYSE:CPY) recently traded at $5.21 per share. At this price level, the stock has a 19.5% dividend yield. For 10 out of the past 10 fiscal years, a share of CPY paid a total of $6.47 in dividends. Of these dividend payments, a total of $3.47 were paid in the last five years.

CPY shareholders have suffered a -75.0% plunge in share price over the past year. At present, shares of this nano-cap stock trade at a price-to-book ratio of 6.6, a price-to-earnings multiple of 23.4, and a price-to-sales multiple of 0.1 (trailing twelve months). Over the past decade shareholders enjoyed a 6.0% average annual return on equity.

CenturyLink, Inc. (NYSE:CTL) recently traded at $35.96 per share. At this price level, the stock has a 8.0% dividend yield. For 10 out of the past 10 fiscal years, a share of CTL paid a total of $8.85 in dividends. Of these dividend payments, a total of $7.75 were paid in the last five years.

CTL shareholders have suffered a -15.6% drop in share price over the past year. At present, shares of this large-cap stock trade at a price-to-book ratio of 1.0, a price-to-earnings multiple of 20.3, and a price-to-sales multiple of 1.8 (trailing twelve months). Over the past decade shareholders savored a 12.9% average annual return on equity.

Educational Development Corp. (NASDAQ:EDUC) recently traded at $5.21 per share. At this price level, the stock has a 9.0% dividend yield. For 10 out of the past 10 fiscal years, a share of EDUC paid a total of $2.20 in dividends. Of these dividend payments, a total of $1.73 were paid in the last five years.

EDUC shareholders have suffered a -16.9% decline in share price over the past year. At present, shares of this nano-cap stock trade at a price-to-book ratio of 1.5, a price-to-earnings multiple of 17.3, and a price-to-sales multiple of 0.8 (trailing twelve months). Over the past decade shareholders savored a 15.4% average annual return on equity.

Great Northern Iron Ore Properties (NYSE:GNI) recently traded at $108 per share. At this price level, the stock has a 12.0% dividend yield. For 10 out of the past 10 fiscal years, a share of GNI paid a total of $88.75 in dividends. Of these dividend payments, a total of $52.25 were paid in the last five years.

GNI shareholders have suffered a -17.9% drop in share price over the past year. At present, shares of this micro-cap stock trade at a price-to-book ratio of 13.2, a price-to-earnings multiple of 7.6, and a price-to-sales multiple of 6.5 (trailing twelve months). Over the past decade shareholders savored a 98.6% average annual return on equity.

Overseas Shipholding Group Inc. (OSG) recently traded at $10.05 per share. At this price level, the stock has a 8.4% dividend yield. For 10 out of the past 10 fiscal years, a share of OSG paid a total of $10.31 in dividends.

OSG shareholders have suffered a -68.7% plunge in share price over the past year. At present, shares of this small-cap stock trade at a price-to-book ratio of 0.2, and a price-to-sales multiple of 0.3 (trailing twelve months). Over the past decade shareholders savored a 12.5% average annual return on equity.

Each of these stocks is attractively priced now because of recent, scary price declines. The question investors must ask is whether the market’s recent pessimism or the past decade of returns is a better indicator of future performance.

Disclaimer: This article was written to provide investor information and education, and should not be construed as a guarantee or as investment advice. I have no idea what your individual risk, time-horizon, and tax circumstances are: please seek the personal advice of a financial planner. This article uses third-party data and may contain approximations and errors. Please check estimates and data for yourself before investing.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 5 Stocks With 8% Yields