Dividend stocks have gotten incredibly popular among investors as the search for income has led many to take on more risk in their portfolios in order to generate the cash flow they need from their investments. With the S&P 500 once again at new highs, another draw of dividend stocks is that historically, they've tended to perform better than the overall market during pullbacks, making more conservative investors feel more comfortable with dividend payers.
But some companies are more generous with dividends than others. Let's take a look at the 15 blue-chip companies that have paid more than $5 billion in dividends to their shareholders over the past 12 months, according to the latest figures from S&P Capital IQ.
Amount Paid in Dividends
Johnson & Johnson
Procter & Gamble
Philip Morris International
Source: S&P Capital IQ. *Reflects three quarters of dividend payments.
As you can see from the table, energy and telecom stocks continue to dominate the list, with the extensive cash flow that those businesses generate outweighing any concerns about future growth in their respective industries. Perhaps the most impressive thing about companies like ExxonMobil and AT&T is that in addition to those dividends, they also maintain massive multibillion-dollar share buybacks as well.
Increasingly, though, we've seen technology stocks start to become dividend payers. Historically, most tech giants have grown fast enough to justify plowing spare cash into internal growth initiatives. But more recently, mature tech companies have had more money than they know what to do with. For instance, Apple started paying a dividend last August, caving to pressure from activist investors arguing that the company's nine-figure cash hoard was a waste of shareholder capital. When S&P Capital IQ includes Apple's latest augmented dividend payment, it should vault the company into the No. 2 spot. Meanwhile, Microsoft has paid dividends longer than Apple, but it too has lifted its payout substantially in recent years to reflect the substantial income that its stalwart Office and Windows software packages produce.
The other area where dividends are making a comeback is in financial stocks. Both Wells Fargo and JPMorgan Chase made dramatic dividend cuts during the financial crisis after receiving TARP bailouts, but since then, the companies have both bolstered their respective financial conditions. JPMorgan's latest payout equals its dividend rate from before the 2009 cut, while Wells now pays six times what it did at the height of the crisis. So long as favorable trends in the banking industry last, the return of financial stocks to healthy dividend status will be a welcome turnaround for investors.
Don't miss out on dividends
These blue-chip examples show how easy it is to get dividend income from your portfolio with promising stocks. With these companies returning billions of dollars to shareholders every year, there's no reason why you should miss out on the opportunity they present now.
But are these 15 stocks really the best dividend stocks available, or are there even better prospects out there? If you're on the lookout for high-yielding stocks, The Motley Fool has compiled a special free report outlining our nine top dependable dividend-paying stocks. It's called "Secure Your Future With 9 Rock-Solid Dividend Stocks." You can access your copy today at no cost! Just click here.
The article These 15 Stocks Are the Most Generous Dividend-Payers in the Market originally appeared on Fool.com.
Fool contributor Dan Caplinger owns shares of Apple and warrants on JPMorgan and Wells Fargo. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Apple and Wells Fargo. The Motley Fool owns shares of Apple, JPMorgan Chase, Microsoft, and Wells Fargo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.