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If you’re considering stocks that pay dividend income, one thing to keep in mind is company profitability. A company’s dividend is only as reliable as its profitability, so be sure to check that a dividend stock also has strong profitability.

We ran a screen on S&P 500 stocks paying dividend yields above 2% for those with impressive profitability, beating their industry peers on gross, operating, and pretax margins.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.


(Click to enlarge)

Do you think these stocks pay reliable dividends? Use this list as a starting point for your own analysis.

List sorted by dividend yield.

1. Intel Corporation (NASDAQ:INTC): Engages in the design, manufacture, and sale of integrated circuits for computing and communications industries worldwide. Market cap of $118.69B. Dividend yield at 3.60%, payout ratio at 30.30%. TTM gross margin at 74.58% vs. industry gross margin at 60.63%. TTM operating margin at 34.45% vs. industry operating margin at 25.47%. TTM pretax margin at 33.66% vs. industry pretax margin at 24.66%. It's been a rough couple of days for the stock, losing 9.16% over the last week.

2. Hasbro Inc. (NASDAQ:HAS): Engages in the design, manufacture, and marketing of games and toys. Market cap of $4.37B. Dividend yield at 3.55%, payout ratio at 38.63%. TTM gross margin at 59.68% vs. industry gross margin at 45.25%. TTM operating margin at 14.01% vs. industry operating margin at 11.48%. TTM pretax margin at 11.11% vs. industry pretax margin at 9.28%. It's been a rough couple of days for the stock, losing 8.59% over the last week.

3. Kellogg Company (NYSE:K): Manufactures and markets ready-to-eat cereal and convenience food products primarily in North America, Europe, Latin America, and the Asia Pacific. Market cap of $17.49B. Dividend yield at 3.53%, payout ratio at 37.47%. TTM gross margin at 44.70% vs. industry gross margin at 33.23%. TTM operating margin at 15.20% vs. industry operating margin at 12.09%. TTM pretax margin at 12.66% vs. industry pretax margin at 9.53%. The stock has lost 1.58% over the last year.

4. Linear Technology Corp. (NASDAQ:LLTC): Designs, manufactures, and markets a line of linear integrated circuits. Market cap of $6.53B. Dividend yield at 3.35%, payout ratio at 39.08%. TTM gross margin at 81.16% vs. industry gross margin at 60.61%. TTM operating margin at 50.54% vs. industry operating margin at 25.46%. TTM pretax margin at 47.82% vs. industry pretax margin at 24.68%. It's been a rough couple of days for the stock, losing 7.73% over the last week.

5. JPMorgan Chase & Co. (NYSE:JPM): Provides various financial services worldwide. Market cap of $119.73B. Dividend yield at 3.17%, payout ratio at 16.82%. TTM gross margin at 80.51% vs. industry gross margin at 62.55%. TTM operating margin at 47.50% vs. industry operating margin at 39.88%. TTM pretax margin at 25.00% vs. industry pretax margin at 19.72%. It's been a rough couple of days for the stock, losing 7.32% over the last week.

6. Sealed Air Corporation (NYSE:SEE): Manufactures and sells packaging and performance-based materials and equipment systems worldwide. Market cap of $3.27B. Dividend yield at 3.05%, payout ratio at 33.84%. TTM gross margin at 30.06% vs. industry gross margin at 22.81%. TTM operating margin at 11.71% vs. industry operating margin at 9.51%. TTM pretax margin at 6.84% vs. industry pretax margin at 6.38%. It's been a rough couple of days for the stock, losing 8.92% over the last week.

7. Prudential Financial, Inc. (NYSE:PRU): Offers various financial products and services in the United States, Asia, Europe, and Latin America. Market cap of $22.50B. Dividend yield at 3.04%, payout ratio at 18.78%. TTM gross margin at 26.76% vs. industry gross margin at 14.25%. TTM operating margin at 12.00% vs. industry operating margin at 11.38%. TTM pretax margin at 10.09% vs. industry pretax margin at 10.08%. This is a risky stock that is significantly more volatile than the overall market (beta = 2.32). It's been a rough couple of days for the stock, losing 7.83% over the last week.

8. KLA-Tencor Corporation (NASDAQ:KLAC): Engages in the design, manufacture, and marketing of process control and yield management solutions for the semiconductor and related nanoelectronics industries. Market cap of $7.70B. Dividend yield at 3.03%, payout ratio at 22.12%. TTM gross margin at 62.17% vs. industry gross margin at 60.61%. TTM operating margin at 36.26% vs. industry operating margin at 25.46%. TTM pretax margin at 34.48% vs. industry pretax margin at 24.68%. It's been a rough couple of days for the stock, losing 5.77% over the last week.

9. Analog Devices Inc. (NASDAQ:ADI): Engages in the design, manufacture, and marketing of analog, mixed-signal, and digital signal processing integrated circuits used in industrial, communication, computer, and consumer applications. Market cap of $10.04B. Dividend yield at 2.97%, payout ratio at 32.66%. TTM gross margin at 70.32% vs. industry gross margin at 60.61%. TTM operating margin at 35.90% vs. industry operating margin at 25.46%. TTM pretax margin at 35.46% vs. industry pretax margin at 24.68%. It's been a rough couple of days for the stock, losing 5.89% over the last week.

10. Honeywell International Inc. (NYSE:HON): Operates as a diversified technology and manufacturing company worldwide. Market cap of $39.87B. Dividend yield at 2.89%, payout ratio at 40.04%. TTM gross margin at 28.99% vs. industry gross margin at 25.80%. TTM operating margin at 12.43% vs. industry operating margin at 11.94%. TTM pretax margin at 9.52% vs. industry pretax margin at 6.67%. The stock has gained 2.61% over the last year.

11. The Coca-Cola Company (NYSE:KO): Distributes, and markets nonalcoholic beverages worldwide. Market cap of $150.49B. Dividend yield at 2.84%, payout ratio at 33.32%. TTM gross margin at 65.50% vs. industry gross margin at 59.38%. TTM operating margin at 23.33% vs. industry operating margin at 23.05%. TTM pretax margin at 33.62% vs. industry pretax margin at 24.48%. The stock has gained 5.31% over the last year.

12. Time Warner Inc. (NYSE:TWX): Operates as a media and entertainment company in the United States and internationally. Market cap of $33.84B. Dividend yield at 2.78%, payout ratio at 32.41%. TTM gross margin at 45.92% vs. industry gross margin at 42.12%. TTM operating margin at 20.01% vs. industry operating margin at 18.49%. TTM pretax margin at 15.29% vs. industry pretax margin at 14.24%. The stock has gained 10.93% over the last year.

13. Snap-on Inc. (NYSE:SNA): Manufactures and markets tools, diagnostics, equipment, software, and service solutions for professional users in the United States, the United Kingdom, Canada, Germany, Japan, France, Australia, Spain, the Netherlands, Italy, China, and Sweden. Market cap of $2.85B. Dividend yield at 2.77%, payout ratio at 22.65%. TTM gross margin at 51.72% vs. industry gross margin at 32.36%. TTM operating margin at 15.10% vs. industry operating margin at 12.94%. TTM pretax margin at 13.32% vs. industry pretax margin at 11.06%. It's been a rough couple of days for the stock, losing 5.24% over the last week.

14. Fifth Third Bancorp (NASDAQ:FITB): Operates as a diversified financial services holding company in the United States. Market cap of $10.85B. Dividend yield at 2.71%, payout ratio at 18.13%. TTM gross margin at 81.78% vs. industry gross margin at 71.86%. TTM operating margin at 49.46% vs. industry operating margin at 39.71%. TTM pretax margin at 26.82% vs. industry pretax margin at 22.63%. This is a risky stock that is significantly more volatile than the overall market (beta = 2.18). The stock has lost 15.17% over the last year.

15. United Technologies Corp. (NYSE:UTX): Provides technology products and services to the building systems and aerospace industries worldwide. Market cap of $66.30B. Dividend yield at 2.62%, payout ratio at 34.03%. TTM gross margin at 30.02% vs. industry gross margin at 25.80%. TTM operating margin at 13.46% vs. industry operating margin at 11.94%. TTM pretax margin at 12.84% vs. industry pretax margin at 6.67%. The stock has lost 5.15% over the last year.

16. PNC Financial Services Group Inc. (NYSE:PNC): Operates as a diversified financial services company. Market cap of $28.44B. Dividend yield at 2.59%, payout ratio at 14.08%. TTM gross margin at 81.22% vs. industry gross margin at 71.81%. TTM operating margin at 41.59% vs. industry operating margin at 39.68%. TTM pretax margin at 28.18% vs. industry pretax margin at 22.62%. The stock has lost 5.82% over the last year.

17. McCormick & Co. Inc. (NYSE:MKC): Engages in the manufacture, marketing, and distribution of flavor products and other specialty food products to the food industry worldwide. Market cap of $6.49B. Dividend yield at 2.54%, payout ratio at 39.63%. TTM gross margin at 44.52% vs. industry gross margin at 33.23%. TTM operating margin at 15.05% vs. industry operating margin at 12.09%. TTM pretax margin at 14.42% vs. industry pretax margin at 9.53%. The stock has gained 6.78% over the last year.

18. Wal-Mart Stores Inc. (NYSE:WMT): Operates retail stores in various formats worldwide. Market cap of $198.70B. Dividend yield at 2.53%, payout ratio at 31.13%. TTM gross margin at 26.93% vs. industry gross margin at 24.34%. TTM operating margin at 5.96% vs. industry operating margin at 5.50%. TTM pretax margin at 5.45% vs. industry pretax margin at 5.14%. The stock has gained 9.23% over the last year.

19. St. Jude Medical Inc. (NYSE:STJ): Develops, manufactures, and distributes cardiovascular and implantable neurostimulation medical devices worldwide. Market cap of $10.78B. Dividend yield at 2.49%, payout ratio at 22.57%. TTM gross margin at 79.16% vs. industry gross margin at 65.64%. TTM operating margin at 25.94% vs. industry operating margin at 14.82%. TTM pretax margin at 20.46% vs. industry pretax margin at 11.38%. It's been a rough couple of days for the stock, losing 9.75% over the last week.

20. Gannett Co., Inc. (NYSE:GCI): Operates as a media and marketing solutions company in the United States and internationally. Market cap of $3.07B. Dividend yield at 2.48%, payout ratio at 9.31%. TTM gross margin at 45.19% vs. industry gross margin at 42.19%. TTM operating margin at 18.88% vs. industry operating margin at 18.49%. TTM pretax margin at 14.51% vs. industry pretax margin at 14.22%. This is a risky stock that is significantly more volatile than the overall market (beta = 2.45). The stock is a short squeeze candidate, with a short float at 10.94% (equivalent to 5.14 days of average volume). The stock has had a good month, gaining 14.67%.

*Profitability data sourced from Fidelity, all other data sourced from Finviz.

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

Source: 20 S&P 500 Dividend Stocks With High Profitability