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A few months ago, I had put together a list of the top international stocks that did prove to be very popular. I believe very strongly in adding international stocks to any dividend portfolio. That does not however require opening accounts in foreign countries and trying to trade in all kinds of exotic currencies. In fact, most of the largest companies around the world, no matter where they are based, do hhave their stocks trading on US markets. Some are only available through pink sheets which is a whole other story. In most cases though, companies such as Credit Suisse (CS), France Telecom (FTE), GlaxoSmithKline (GSK) and Vodafone (VOD) which we reviewed recently are very easy to trade in the US.
Another option of course is to add US based stocks that have a large portion of their activity outside of the country, such as Aflac (AFL) which I picked as part of the stock picking competition and also recently added to the Ultimate Sustainable Dividend Portfolio.
One important aspect about adding international dividend payers is that in some countries, companies end up waiting to see their yearly results to pay out dividends. This practice has benefits and downsides:
Benefits:
-strong dividends in general as companies do not feel the pressure that dividend aristocrats feel for example
-management incentives to maximize profits (and thus dividends)
-healthier for the company as it pays what it can afford to pay
Downsides:
-Less reliable (these companies can reduce their payouts at any moment)
So today, I wanted to present, among the group of foreign based stocks that I follow, those that pay out the top dividend yield. Let’s start off that way:
Ticker Name Price Dividend Yield Payout Ratio
BFR BBVA Banco Frances SA 5.92 18.15 N/A
YPF YPF SA 22.93 14.63 N/A
EC Ecopetrol SA 62.49 14.26 N/A
STD Banco Santander SA 6.7 13.68 99.45
FTE France Telecom SA 13.74 12.98 95.21
BMA Banco Macro SA 17.79 11.7 N/A
NZT Telecom Corp of New Zealand Ltd 10.39 11.44 211.25
TEF Telefonica SA 15.36 10.98 135.15
AV Aviva PLC 10.04 10.08 102.73
VE Veolia Environnement SA 14.82 9.93 N/A
IRS IRSA Inversiones y Representaciones SA 9.16 9.4 N/A
AZN AstraZeneca PLC 45.03 8.66 36.84
VIP VimpelCom Ltd 10.75 7.74 124.32
PT Portugal Telecom SGPS SA 4.98 7.69 329.79
TLK Telekomunikasi Indonesia Persero Tbk PT 32.97 7.13 N/A
BBVA Banco Bilbao Vizcaya Argentaria SA 7.14 6.94 68.55
WBK Westpac Banking Corp 115.76 6.86 67.27
SID Cia Siderurgica Nacional SA 9.34 6.82 25
BSI Alon Holdings Blue Square Israel Ltd 3.7 6.53 N/A
BAK Braskem SA 15.8 6.51 N/A
TEO Telecom Argentina SA 17.27 6.41 N/A
HBC HSBC Holdings PLC 43.75 6.4 45.14
TI/A Telecom Italia SpA 9.05 6.36 N/A
ENL Reed Elsevier NV 24.55 6.08 69.79
BCA Corpbanca 20.45 6.02 N/A
RUK Reed Elsevier PLC 34.29 5.93 66.58
CTEL City Telecom HK Ltd 12.37 5.92 73.71
CPL CPFL Energia SA 29.57 5.87 81.08
ATAI ATA Inc/China 6.98 5.87 0
GSK GlaxoSmithKline PLC 45.47 5.84 71.43
BTI British American Tobacco PLC 101.02 5.48 80.1
SFUN SouFun Holdings Ltd 18.42 5.32 0
TOT Total SA 49.04 5.32 43.9
SNP China Petroleum & Chemical Corp 107.94 5.25 35.52
BCS Barclays PLC 14.33 5.23 24.21
FLY Fly Leasing Ltd 12.33 5.18 1886.38
GFA Gafisa SA 4.5 5.07 N/A
TMX Telefonos de Mexico SAB de CV #N/A N/A 5.06 64.92
APSA Alto Palermo SA 16.9 5.05 N/A
E ENI SpA 43.6 5.03 52.8
CHT Chunghwa Telecom Co Ltd 30.6 4.91 90
PSO Pearson PLC 18.21 4.91 35.21
AWC Alumina Ltd 5 4.77 423.12
HNP Huaneng Power International Inc 22.71 4.75 59.53
CRH CRH PLC 20.07 4.72 76.16
MBT Mobile Telesystems OJSC 18.3 4.7 71.79
PUK Prudential PLC 23.61 4.59 43.09
BP BP PLC 42.96 4.47 16.9
TNE Tele Norte Leste Participacoes SA 10.99 4.38 23.75
CIG Cia Energetica de Minas Gerais 25.37 4.26 87.97
Clearly, as I say every month, having the top dividend yield is not enough. In fact, it’s rarely a good sign:) So let’s dig a bit deeper. I took all of those names and looked for companies that have increased dividends and sales by 5% or more annually over 5 years with a dividend yield of 5% or more. Then, I removed companies that have a payout ratio over 75%. Guess how many names I have left? Just 5:)
Ticker Name Price Dividend Yield Payout Ratio
SID Cia Siderurgica Nacional SA 9.34 6.82 25
SNP China Petroleum & Chemical Corp 107.94 5.25 35.52
WBK Westpac Banking Corp 115.76 6.86 67.27
MBT Mobile Telesystems OJSC 18.3 4.7 71.79
TOT Total SA 49.04 5.32 43.9
What are your thougghts on these? I will certainly take a deeper look but I thought it was quite interesting:)
[...] 1. Top International Dividend Stocks – April 2012 @ IS. [...]
So you wouldn’t buy FTE? I’m chasing high dividends.
Re you question on retirement preparation…I’m long retired so now I’m just playing around with my assets trying my acumen/expertise in keeping/making money to avoid any catastrophies that may pop up; as your scenario with AOL did to you. I do like your dividend listing but especially with your recognition that over ~27% payout makes it too risky thereby reducing it to the five. Also, I use FINVIZ website to screen:a)+7% Dividend Yield and b)Strong Buy-Analyst Recommendations. Thanks for your website!
YPF has been nationalized by the government of Argentina. Absolutely, the divident yield is not everything.
@Stephen – I did not look too much into FTE but having a payout ratio of nearly 100% does not sound very promising no…
Stephen, I know of no ETF, that offers yields as high as those listed by, IS..
You sure about the payout ratio on France Telecom? My numbers say FCF of 2,32 EUR and a dividend of 1,4 EUR, and they might lower it.
[...] Speculator presents Top International Dividend Stocks – April 2012 posted at Intelligent Speculator, saying, “What are the top dividend [...]