Searching for High Dividend Yields? Don't Expect Safety.
Telefonica Antenna (Photo credit: Wikipedia)
If you are looking for high dividend yields, take a look at the following stocks, all of which have a large market capitalization (over $5 billion) and solid return on equity. A couple of these have been hit hard by the recession in Europe:
1) Telefonica SA (TEF) - dividend yield was 12.1%; return on equity for the last 12 months is 28.3% and market capitalization is $55 billion; you'll have to wait until they reinstate the dividend, since it was recently suspended so they could pay down some of their debt - dividend could return in 2013
Telefonica, S.A. is a telecommunications group which provides a range of services through its telecommunications networks mainly focused on providing fixed and mobile telephony services and present mainly in Spain, Europe and Latin America.
2) France Telecom (FTE) - current dividend yield is 10.9%; return on equity for the last 12 months is 14.2% and market capitalization is $36 billion; there are rumors that the dividend will be reduced in 2013
France Telecom SA provides telecommunications services to residential, professional, and large business customers. Company offers public fixed-line telephone, leased lines and data transmission, mobile telecommunications, cable television, Internet etc.
3) Energy Transfer Partners (ETP) - current dividend yield is 8%; return on equity for the last 12 months is 13.6% and market capitalization is $6.9 billion
Energy Transfer Partners, L.P. is a publicly traded partnership owning and operating a portfolio of energy assets (pipeline transportation of natural gas).
I really liked AT&T (T) when the dividend yield was over 6% a year ago. Now it is 4.7%.
Bottom line is if you go chasing dividend yield, be cautious since a high yield may not last for very long.
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