CenturyLink – 8.2% Dividend Yield
Telecom stocks are frequent favorites of dividend investors. That’s because reliable cash flows from monthly data and voice subscriptions allow companies to offer reliable dividends. CenturyLink (NYSE:CTL) has been paying dividends since 1974, and its current payday is an impressive 72.5 cents per quarter — adding up to an 8.2% yield.
True, landline telephone service seems like a bad investment opportunity given the digital age, but after the recent merger with Qwest, you can have faith that CTL will be around to pay those plump dividends for many more years to come. Shares might not be impressive — a -25% performance year-to-date is quite ugly — but that 8.2% return on your investment via dividends is a mighty nice hedge against further losses. The selloff earlier this year was related to costs incurred digesting the massive Qwest merger, and a better Q3 report could indicate a more stable company these days.
SeaDrill — 8.4% Dividend Yield
SeaDrill (NYSE:SDRL) is an offshore drilling contractor serving the oil and gas industries worldwide. The company owns the manpower and ships to tap wells, then turns those wells over to big energy companies. It’s a lucrative business, and SDRL offers a big chunk of its revenue back to shareholders in the form of dividends.
Like Annaly, however, those dividends can fluctuate quarter to quarter. SeaDrill’s two most recent payouts have been 75 cents apiece — giving SDRL stock an 8.4% yield at current valuations based on a $3 annual dividend. If you take the last four consecutive paydays, you get almost the same number — $3.025 based on 75 cents in September + 75 in June + 87.5 in March + 65 in December. SeaDrill stock essentially is flat year-to-date — however, this big dividend is a mighty nice return on investment. Energy stocks continue to spend big bucks on exploration, and that bodes well for SeaDrill’s bottom line.
For a more in-depth look at SeaDrill, click here.
Jeff Reeves is the editor of InvestorPlace.com. Write him at firstname.lastname@example.org, follow him on Twitter via @JeffReevesIP and become a fan of InvestorPlace on Facebook. As of this writing, he did not own a position in any of the aforementioned stocks.