23 High-Yield Stocks from the S&P 500 in Comparison

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Nov 17, 2012
The S&P 500 index is a popularly used tool by investors. It is a free-float capitalization-weighted index published since 1957 by Standard & Poor's, a division of McGraw-Hill Companies. Professionals like big insurance players or pension funds allocate their portfolio weighting on indices like the S&P 500 and the Dow Jones. For income investors, people who search the best dividend paying stocks in order to boost their dividend income, it is very revealing to know what yields are currently available.


I screened the index with its 500 companies by a minimum dividend yield of 5 percent. The index has 23 high yields and the highest yield amounts to 13.61 percent, paid by Pitney Bowes (PBI, Financial). Eight high yields have a P/E ratio below 15 and nine are currently recommended to buy.


Here are my favorite stocks:


Altria Group (MO, Financial) has a market capitalization of $63.26 billion. The company employs 9,900 people, generates revenue of $23.8 billion and has a net income of $3.39 billion. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $6.32 billion. The EBITDA margin is 26.56 percent (the operating margin is 25.5 percent and the net profit margin 14.26 percent).


Financial Analysis: The total debt represents 37.04 percent of the company’s assets and the total debt in relation to the equity amounts to 371.98 percent. Due to the financial situation, a return on equity of 76.13 percent was realized. Twelve trailing months earnings per share reached a value of $1.92. Last fiscal year, the company paid $1.58 in the form of dividends to shareholders.


Market Valuation: Here are the price ratios of the company: The P/E ratio is 16.27, the P/S ratio is 2.59 and the P/B ratio is 16.94. The dividend yield amounts to 5.77 percent and the beta ratio has a value of 0.42.


AT&T (T, Financial) has a market capitalization of $188.24 billion. The company employs 241,130 people, generates revenue of $126.723 billion and has a net income of $4.184 billion. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $27.59 billion. The EBITDA margin is 21.78 percent (the operating margin is 7.27 percent and the net profit margin 3.3 percent).


Financial Analysis: The total debt represents 23.95 percent of the company’s assets and the total debt in relation to the equity amounts to 61.36 percent. Due to the financial situation, a return on equity of 3.63 percent was realized. Twelve trailing months earnings per share reached a value of $0.77. Last fiscal year, the company paid $1.73 in the form of dividends to shareholders.


Market Valuation: Here are the price ratios of the company: The P/E ratio is 42.99, the P/S ratio is 1.50 and the P/B ratio is finally 1.88. The dividend yield amounts to 5.39 percent and the beta ratio has a value of 0.55.


NYSE Euronext (NYX) has a market capitalization of $5.48 billion. The company employs 3,061 people, generates revenue of $4.552 billion and has a net income of $603.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.13 billion. The EBITDA margin is 24.82 percent (the operating margin is 18.67 percent and the net profit margin 13.25 percent).


Financial Analysis: The total debt represents 15.87 percent of the company’s assets and the total debt in relation to the equity amounts to 31.53 percent. Due to the financial situation, a return on equity of 9.25 percent was realized. Twelve trailing months earnings per share reached a value of $1.69. Last fiscal year, the company paid $1.2 in the form of dividends to shareholders.


Market Valuation: Here are the price ratios of the company: the P/E ratio is 13.37, the P/S ratio is 1.2 and the P/B ratio is finally 0.88. The dividend yield amounts to 5.32 percent and the beta ratio has a value of 1.62.


Take a closer look at the full table of high-yield stocks from the S&P 500. The average P/E ratio amounts to 19.86 and forward P/E ratio is 12.42. The dividend yield has a value of 6.69 percent. Price to book ratio is 3.45 and price to sales ratio 1.41. The operating margin amounts to 16.45 percent.