Sean Clark is the Chief Investment Officer for Clark Capital Management which has 3 billion under management. He was recently on CNBC to discuss his positive outlook for the markets as we head into the summer months. Mr. Clark said that old adage of "Sell in May" does not hold up well in election years. Statistics show that the summer months provide a positive return 2/3rds of the time during an election year.
While there is no guarantee that the market will move higher this summer, Mr. Clark believes that a break higher in the market could signal that the market is moving towards the positive election year trend. Mr. Clark named 4 dividend-paying stocks that he likes for the summer months.
JP Morgan Chase (JPM)
Clark said that JP Morgan is the premier bank which trades at 9 times earning at present and is expected to increase earnings over the next 2 years. JPM has a dividend yield of 2.4% and a payout ratio of 23%. The company has increased its dividend for the 2nd consecutive year in 2012 and has a 3 year dividend growth rate of 33%.
Abbot Labs (ABT)
Clark likes the healthcare industry and owns Abbot Labs which is currently trading at 12 times earnings. Abbot has a great nutrition business that is growing internationally especially in emerging markets. ABT is one of our favorites on our best dividend list with a yield of 3.1% and a payout ratio of 67%. The company has increased its dividend for 39 consecutive years and has a 3 year dividend growth rate of 10%.
Coca-Cola Company (KO)
Coca-Cola's higher than market yield and a great international business give Clark a reason to hold on to Coke during the summer months. Even though Coke has a decent yield we would like to see it higher than it currently stands at 2.8%. KO has a payout ratio of 26% and a 3 year dividend growth rate of 11.5%. It has increased its dividend for 49 years.
Staples (SPLS)
Staples is viewed as a defensive play by Clark in case the market does not break out. SPLS has a dividend yield of 2.6% and a payout ratio of 29%. The company has increased its dividend for 2 years and has a 3 year dividend growth rate of 53%. Staples is currently trading at 11 times earnings.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
