Top 100 Dividend Stocks – April 2012

By: ispeculatornew
Date posted: 04.03.2012 (4:00 am) | Write a Comment  (0 Comments)

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I’ve written a few times about how looking at dividend yield could be misleading. One part of the reason is that some companies end up paying more than they can afford to. FTR is one obvious example and I will discuss it a bit later but there are many more.

Can you believe that only one of the top 10 companies actually has a payout ratio under 75%!! To me that is shocking. Dividend investing is about much more than finding a big yield, it is about finding longer term stocks that will be able to increase their dividend yields over time.

I wrote about why dividend investing is not just a trend and I think that finding the right stocks to include is a critical part.

Today, we are back with our list of the top 100 dividend stocks from the S&P500 and there is no surprise in who is on top. I would caution greatly against investing based only off of a dividend yield though.

Frontier Communications Corp (FTR)

No big surprise again this month as Frontier Communications Corp (FTR) remains at the very top of our top dividend stocks in the S&P500 with a dividend yield close to 10%. The yield has come down from its high of 17% a few months ago but remains high for 2 reasons:

-The stock’s price keeps diminishing
-No one expects the company’s dividend to actually remain so high (yes, FTR’s dividend WILL diminish)

The dark side of course remains that the company is paying out much more than it is actually able to make, making that dividend everything but sustainable. Every month, I do more in-depth research to find dividend names and FTR has never come out on top of that research..!!

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FTR’s Dividend Payout History

FTR’s days at the top of this chart are nearing its end in my opinion (of course, it’s not the first time I’ve said this). Not only is FTR going to likely announce a dividend cut later this quarter but if things keep up, it will not be able to remain in the S&P500… should be interesting! Next week, we will do further research on the 100 stocks listed here to determine which ones are more likely to do well in the long term both based on sustainability and the 20 things that we look for in dividend stocks.

In the meantime, here is the list!

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