by Jim Woods | October 12, 2012 8:30 am
I don’t like to be bored.
I mean, isn’t life all about exciting, new experiences that offer thrills, and even the prospect of a little danger? I guess that’s why I drive race cars, raise rodeo horses, compose and perform music, and trade stocks and options.
However, there is one part of my life where I prefer boring, and that’s when it comes to stocks that pay dividends.
You see, when it comes to income investing, slow, steady, stable and yes, even boring, rules the roost. Nobody wants huge volatility in what I call their “serious money” (as opposed to certain pundits always talking about their “mad money”). Rather, what we really want is a reliable dividend that delivers market-beating yield for our hard-earned bucks.
So, armed with this thesis, here are five boring stocks paying solid dividends:
Dividend Yield: 5.3%
Once known as Philip Morris, Altria Group (NYSE:MO) is the premier manufacturer of tobacco products in the world. The maker of iconic brands such as Marlboro cigarettes has fired up shareholders portfolios with their dividend payout. In fact, the company has increased its dividend every year for the past 42 years. The shares currently offer an annual yield of 5.3%, an extremely attractive metric for income investors. Oh, and this year the stock is up nearly 15%, which is anything but boring even for traders.
Dividend Yield: 3.6%
We all know about the massive demographic shift that surrounding the baby boomer generation shifting into retirement. This trend alone means we are going to see burgeoning demand for healthcare products like the kind made by Johnson & Johnson (NYSE:JNJ). The reason this company is so well positioned is the sheer diversity of its product lines. From oral care to analgesics to arthritis medications, if it ails you, then J&J probably has an elixir to soothe it. These kinds of healthcare products may not be glamorous, but what will make you look like a portfolio star is the 3.6% dividend yield you get when you own the stock.
Dividend Yield: 3.3%
Premier consumer goods company Procter & Gamble (NYSE:PG) is the maker of iconic brands such as Ivory Soap, Crest toothpaste and Head & Shoulders shampoo. The company’s pantheon of household brand names ensures that no matter what kind of economic climate we’re in, people still are going to purchase items made by P&G. Yes, soap and shampoo isn’t the next Apple (NASDAQ: AAPL) or Google (NASDAQ:GOOG), but it is going to deliver a solid and steady dividend, currently sitting at a very attractive 3.3% yield.
Dividend Yield: 3.6%
Utility stocks are usually thought of as boring, but there’s nothing boring about the 22% year-to-date gain in shares of power and natural gas provider Sempra Energy (NYSE:SRE). The company is divided into five segments, but its primary money makers are San Diego Gas & Electric, and Southern California Gas Co., the latter of which I am a customer. Of course, the company also operates as an energy holding company throughout the world, and at last count it had some 31 million customers around the globe. This energy/utility giant has a powerful dividend yield of 3.6%, making it a solid yield-producing — albeit boring — stock.
Dividend Yield: 4.5%
Traditionally, telecom stocks have been extremely boring but stalwart dividend plays. These days, there’s a lot of action in telecom, especially on the wireless front. Still, I consider a company like Verizon Communications (NYSE:VZ) a boring company that pays an anything-but-boring 4.5% dividend yield. The stock is up 13.8% so far in 2012, so along with that high yield, you also get to dial up some very strong share price appreciation.
As of this writing, Jim Woods did not hold a position in any of the aforementioned securities.
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