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The 7 Worst Dow Dividend Stocks for October

These components have little to offer income investors

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#1: Bank of America

Bank of AmericaDividend Yield: 0.4%
Payout Ratio:
YTD Performance: +65%

Bank of America was turned down in 2011 when it asked the Federal Reserve for permission to increase its dividend, so it didn’t even bother earlier this year following a round of bank “stress tests.”

BAC’s 1-cent quarterly payout actually represents 400% of its 2011 earnings, so it seems difficult to gripe about the lack of any recent increase. But despite a breakeven third quarter, 2012 earnings are expected to be around 41 cents per share, putting that payout ratio closer to 10%.

Current shareholders might be a little slow to complain, considering that BAC is on pace to finish as the Dow’s best-performing stock of the year at 65% gains for the year-to-date. But considering that run has come amid generous reports with easy year-over-year comparisons, it’s worth wondering whether Bank of America can keep it up.

And with a dividend yield wholly to the right side of the decimal point, income investors have absolutely no reason to wait around and find out.

Kyle Woodley is the Assistant Editor of As of this writing, he did not hold a position in any of the aforementioned securities. Follow him on Twitter at @KyleWoodley.

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