Top Dividend Stock #5: General Electric
Dividend Yield: 3.48%
YTD Performance: -9.38%
52-Week Return: +8.36%
General Electric (GE) cut its dividend to just 10 cents back in 2009 when the financial crisis was at its peak. So how did GE manage to make it onto our list of Dow dividend stocks?
Well, ever since bottoming out below the $10 mark, the General has increased its dividend by a massive 120% to a current quarterly payout of 22 cents per share. That might not sound like a lot, but with the stock trading at approximately $25.50, that 22 cents makes for 3.5% dividend yield.
Among other reasons, that dividend increase is also why GE has seen a huge run up in its stock over the last five years. The titan of industry has been steadily regaining investors’ trust through increased distributions, and if you happened to buy the shares when they bottomed out around $7, you’d be sitting on a triple-digit total return, which includes $2.86 in dividend income per share.
Last month, news broke that legendary investor Warren Buffett had acquired a massive position in GE to the tune of about $300 million, or approximately 10 million shares. Buffett’s track record, not to mention the sheer size of his position, should be a positive indication about where the stock is headed. Additionally, GE CEO Jeffrey Immelt just recently used his cash bonus to purchase $2.6 million worth of his company’s stock.
If GE’s handsome dividend yield of 3.5% didn’t grab your attention, these two huge endorsements by some of the biggest names in business should certainly have you considering GE as part of your long-term portfolio.