Current Dividend Yield: 4.9%
Performance So Far in 2012: +1%
Verizon (NYSE:VZ) remains the leading wireless telecom provider in the U.S. by subscriptions, thanks to the failed AT&T and T-Mobile merger. The company also is one of the top high-speed Internet providers in America via its FiOS fiber optic network. As the world becomes increasingly wired, it’s more important than ever for companies like Verizon to be involved with the operations of businesses and the lives of regular Americans.
This provides a very stable revenue stream that accounts for huge dividends. Like many low-risk dividend stocks, this is a double-edged sword because there might not be any huge growth opportunities for the entrenched telecom. But strong cash flow generation and the lack of any real competition from anyone other than AT&T (NYSE:T) means this telecom stock is a stalwart that’s here to stay.
Things are in the works to free up some cash at Verizon, too, in an effort to fund growth and perhaps increase dividend distributions. From rumors that VZ will cut back its iPhone subsidy to reports that billions of dollars worth of wireless spectrum could be up for auction, clearly this company isn’t just sitting still.
And if these moves don’t move the stock? Well, you could do worse than an almost 5% annual return via dividends.