Tuesday, July 22, 2008

The Top 10 Highest Yields of the S&P 500

In light of the financial disaster the U.S. financial institutions have subjected the world to, I thought it would be interesting to run a quick screen of the top dividend yielding stocks in the S&P 500. I thought it might be real interesting to see given the nose-dive many stocks have taken in the past few week.

To get the list of stocks, I used the real simple, but pretty basic stock screener at MSN Money. Here is the criteria that I changed in the stock screen (all other fields I left as is):

S&P Index Membership = S&P 500
Dividend Yield = As high as possible

That's it. A really simple screen that should yield very interesting results. Here are the top 10 dividend yield stocks that MSN returned with the above criteria:

It is really no surprise that most of these stocks are banks with large mortgage exposure. Look at Fannie Mae with a current yield of 19.80% - wouldn't that be a nice yield to realize. The results in this list provide a very clear reminder of why having a strictly high dividend yield strategy can be very risky. I think it is a very good probability that Fannie Mae will not be paying out the current dividend and that a dividend cut or an all out dividend suspension is soon to become a reality. Many of these stocks are also in the same boat - have cut the dividend or at a high risk of a dividend cut. With my dividend growth strategy, these stock are ones that I want to avoid buying or add additional money to.

This article was written by The Dividend Guy. You may email questions or comments to me at info@thedividendguyblog.com.

1 comment:

  1. Not sure what screener you are using, but ACAS is an s&p componnet and yields nearly 20%. So your data might be wrong.

    ReplyDelete

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