These stocks are not always noticed.
Most dividend stock investors stick to a fairly small universe of stocks. If you’ve been investing for a while, you can probably name a dozen of these names off the top of your head that have paid dividends for decades. But Wall Street is a big place, and smart investors explore all their options instead of simply buying what everyone else does. In an era where Treasurys don’t return much more than 2 percent, those seeking bigger yields have crowded into the popular stocks. Each of the following large-cap stocks has a thriving business, a $20 billion size or greater and a dividend yield that is north of 3 percent.
Cisco (Nasdaq: CSCO)
Many investors gave up on Cisco over the last few years, as the tech company looked comparatively old and stodgy when placed head-to-head with fast-growing picks like Facebook (FB). However, even though the growth trajectory is not what it once was, CSCO does have something Facebook doesn’t — a reliable dividend that yields 3.2 percent. That dividend has soared almost five-fold since it was instituted in 2011, growing from 6 cents to 29 cents quarterly. And after a recent big earnings beat that sent shares soaring, you can be sure that track record of generous payouts will only continue going forward.
China Mobile (CHL)
When investors think of their favorite blue-chip stocks, the list tends to be a bunch of U.S.-based corporations. But don’t sell international powerhouses like China Mobile short. After all, this is a state-owned Chinese telecom valued at more than $200 billion and generates more than $100 billion in top-line revenue each year. That reliable cash flow from mobile telecommunications in fast-growing China leads to reliable dividends, too, that equal about 7 percent annually. Unfortunately those dividends only come twice a year, with a small payout in the second quarter and a bigger payout in Q3. But CHL is certainly worth a look given the size and quality of its dividends.
Las Vegas Sands Corp. (LVS)
Another overlooked blue-chip stock is casino operator Las Vegas Sands. This mammoth company has a $50 billion market value and is one of the biggest brands in gaming. It also has a hefty dividend that has nearly tripled in five years, from 25 cents in 2012 to 73 cents per quarter at present. That’s worth a 4.4 percent yield. Thanks both to its powerful operations at home in the U.S. as well as its fast-growing operations in the Asian gaming mecca of Macau, LVS stock is pacing double-digit revenue growth yet again in 2017 — a sign both of a healthy stock and a healthy cash stream to fuel future dividends.
HSBC Holdings (HSBC)
Many income investors gravitate to the four biggest U.S. banks if they want to play financials. But Britain’s HSBC is an interesting investment option because it saw a huge drop in 2016 based fears of a messy Brexit that would raise barriers to the broader European economy. But now, after the election of more moderate forces and some damage control on the initial Brexit plans, HSBC has surged more than 50 percent in a little over a year. The company has continued to pay its dependable $2 in annual dividends, good for a 5.3 percent annual yield. There is still uncertainty in Europe, but don’t let it scare you off this world-class bank and its generous dividend.
Blackstone Group (BX)
The Blackstone Group is a global financial firm that perhaps isn’t quite as renowned as Goldman Sachs (GS), but is no slouch with a nearly $40 billion market value and generates roughly $7 billion in annual revenue. That comes from everything from asset management to private equity investments to corporate lending. Blackstone has done well as the economy has kicked into high gear. Over the last five years, BX stock has outperformed the Standard & Poor’s 500 index with 135 percent returns since 2012 compared with 90 percent returns for the popular stock benchmark. But that’s not all — with a 7.3 percent dividend to boot, investors certainly have a lot to cheer about lately.
Novartis (NVS)
Swiss drugmaker Novartis isn’t as well-known as some other pharmaceutical giants, but it has its share of blockbusters under its belt, including ADHD medication Ritalin and antifungal treatment Lamisil. As a result of this success, Novartis also boasts a market value of more than $200 billion and a generous 3.2 percent dividend. Like many European companies, however, this dividend doesn’t come quarterly but rather once a year. That payment comes around March, so you have to be patient, but the wait is worth it based on the stability and yield offered by NVS stock.
General Motors Co. (GM)
Many income investors gave up on General Motors after the company declared Chapter 11 bankruptcy in 2009. But the rejuvenated GM is rapidly proving itself a reliable income play worth another look. Consider for starters that the company pays a roughly 3.5 percent dividend after reinstating payments just a few years ago. Furthermore, GM has outperformed the S&P index nicely this year with 26 percent gain since January. And to top it all off, 2018 looks very bright thanks to ambitious efforts from its Cruise self-driving car unit and its Volt electric vehicle line.
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7 Overlooked Large-Cap Dividend Stocks originally appeared on usnews.com
