3 High-Dividend Stocks to Buy Now – V, CL, BBY
Dividend stocks have had a hard time of it lately. According to a recent Standard and Poor's survey, only 191 out of 7,000 publicly-traded companies raised their dividends last quarter.
But dividends are not dead. There are companies out there that have maintained and raised their dividends in the past year.
When I'm shopping for good dividend stocks, I look for companies that have maintained or raised their dividends every year, despite the tough economic climate. This shows me that these companies have more than enough cash coming in to support this kind of payout.
Here are a few of my favorites:
Dividend Stock #1 - Visa (V)
The credit card giant went public last year. In its latest quarterly earnings report, Visa said revenue was up 10% from last year, and earnings came in two pennies above estimates. Visa is now four-for-four, posting earnings surprises each of the last four quarters, by an average 7 cents. Analysts have been scrambling to raise their forecasts higher in response to these results.
The icing on the cake? Visa pays a 50-cent dividend. Because we can see that the company is growing and it pays a nice dividend, I rate this stock a buy.
Dividend Stock #2 – Colgate-Palmolive (CL)
CL is a household name in household products. Toothpaste and soap are necessities, not luxuries, and Americans have continued to purchase CL products frequently even during the worst of the economic downturn.
In its third-quarter earnings report, CL reported a profit increase of 18% to $590 million, or $1.12 a share, beating estimates by a penny. Revenue also climbed during the quarter to $4 billion, which was also higher than the consensus.
Colgate also pays a $1.76 annual dividend. The company has paid uninterrupted dividends on its common stock since 1895 and increased payments to common shareholders every year for almost half a century. I rate this stock a buy.
Dividend Stock #3 – Best Buy (BBY)
Consumer spending and the economy are recovering, and so is the bottom line of electronics retailer Best Buy. In its latest quarter, BBY reported an increase in customer traffic to its stores. I expect this holiday shopping season should boost the retailer's sales and earnings in the coming quarter, and Wall Street analysts have been raising their forecasts higher as a result. Positive analyst revisions typically precede earnings surprises, which is one reason I like Best Buy.
BBY also pays a 56-cent annual dividend to its common stock shareholders. I rate this stock a buy.
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