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The European Union is wrestling with a sovereign debt crisis that is threatening to derail the bloc's closer political and economic integration. Banking sectors in Greece and Spain have seen runs on banks, as depositors fear the rising financial instability, and possible bank failures, could lead to savings losses.

The economy of the region as a whole has come to a crawl, while several countries fight a new recession. Things could get even worse if Greece exits the eurozone and the sovereign debt crisis engulfs other weak links in the European Union, such as Spain, Italy, or Portugal. It is almost certain that the region's economy is heading toward recession. Now there are fears that the economic decline could be severe and long.

A sharp decline in Europe's economy would send shivers throughout the world economy. It is likely that corporate sector's revenue and profitability would suffer. While slow growth or recession would affect directly or indirectly earnings of most companies, some businesses would cope better than others.

Expanding at a relatively moderate pace, the U.S. economy is still providing opportunities for companies to boost sales and profits. A deep recession in Europe would adversely affect the U.S. economy, but the impact on the business sales of U.S.-dependent companies would not be as negative as a blow to the sales of those companies that greatly depend on Europe.

While most U.S.-based utilities would do well, here are five dividend-paying U.S. companies from the various industries that have little or no direct revenue exposure to the European market. These businesses are likely to fare better than those that heavily rely on sales to Europe.

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Verizon (VZ) is a telecommunications giant with some 108.7 million U.S. wireless subscribers at the end of 2011. The company has a market capitalization of $117.5 billion. Verizon has a small European exposure as it derives the vast majority of its revenues from U.S. operations. The company pays a dividend yield of 4.8% on a payout ratio of 215% of earnings and 37% of free cash flow. Its competitor AT&T (T) pays a yield of 5.2%, while Sprint Nextel (S) does not pay any dividends. The company has a price-to-book ratio of 3.2x, above the industry's 0.8x. Its stock trades at $41.45 a share, 14.9x its forward earnings. Verizon shares are up 5.1% from the beginning of the year.

Raytheon Co. (RTN) is a technology company specializing in defense, homeland security, and other government markets. It generates about 5% of its revenue from the European market. The company pays a dividend yield of 4.0% on a low payout ratio of 36%. Its peers Northrop Grumman (NOC) and Lockheed Martin (LMT) are yielding 3.7% and 4.8%, respectively.

The stock has a price-to-book ratio of 1.98x, below the industry's ratio of 2.32x, and a forward P/E of 9.6x (on par with its industry). Goldman Sachs downgraded the stock to sell last week, based on the argument that the company had the "lowest free-cash-flow yield and was the consensus long in large-cap defense sector…due to international and intel exposures." The stock is trading at $49.7 a share, up 3.4% year-to-date.

The Travelers Companies (TRV) is an insurance company with market capitalization of some $24.8 billion. The company is a "leading provider of property casualty insurance for auto, home, and business." With total revenues of about $25 billion in 2011, this insurer reported international sales, including those in Europe, at less than 5% of total revenues. T

he company pays a dividend yield of 2.6% on a payout ratio of 54%. Its rival Allstate Corporation (ALL) pays a dividend yield of 2.6%, while peer American International Group (AIG) does not pay dividends. The company's price-to-book ratio is 0.98x, above its industry's ratio of 0.75x. The insurer's shares, which are up 6.6% from the beginning of the year, are trading at $62.9 or 9.9x the company's forward earnings. Billionaire Israel Englander boosted his stakes in the company significantly recently.

Wal-Mart (WMT) is an international discount retail giant with $223 billion in market capitalization. Wal-Mart has a direct exposure to the European market vis-à-vis its ownership of Asda, the UK's second largest food and general merchandize retailer. Asda operates 544 stores throughout the UK and has annual revenues of about 7.5% of Wal-Mart's total revenues per year. This appears to be a manageable exposure to a non-eurozone member of the European Union.

Wal-Mart pays a dividend yield of 2.4% on a payout ratio of 34%. The company's peers Costco Wholesale Corporation (COST) and Target Corp. (TGT) pay dividend yields of 1.3% and 2.1%, respectively. Wal-Mart trades at $65.7 a share, with a price-to-book ratio of 3.21x (below its industry's) and a forward P/E of 12.3. The company's shares are up 8.8% year-to-date. Warren Buffett's Berkshire is among Wal-Mart investors.

Home Depot (HD) is the world's largest home improvement specialty retailer, with $76 billion in market capitalization. The company does not export to Europe or have any operating facilities on the continent. Still, this is a cyclical company whose sales may be adversely affected by the general weakness in the macroeconomic environment, and, particularly, by a soft housing market.

Home Depot pays a dividend yield of 2.3% on a payout ratio of 44%. The company's closest rival Lowe's Companies (LOW) pays a dividend yield of 2.1%. Home Depot has a price-to-book ratio of 4.21x (well above the industry's ratio of 1.35x) and a forward P/E of 15.1. The company's shares are trading at $49.8, up 18.2% from the beginning of the year. Andreas Halvorsen's $12 billion hedge fund initiated a brand new position in HD during the first quarter (see its new picks).

Source: 5 Dividend Stocks Shielded From Europe's Woes