Two Dozen Giant Caps with Generous Dividends: Two Stocks Particularly Intriguing

Want stability and income? Then you’d best go to the YCharts Screener function. Let’s say we ask for companies with market caps of $100 billion or more – the biggest – and a dividend yield of at least 3%.

The YCharts stock screener brings up two dozen stocks. Trouble is, most are in industries with caution signs flashing, or at least requiring some special expertise to avoid stepping in it. The telecoms – AT&T (T), Verizon (VZ), China Mobile (CHL) and Vodafone (VOD) – are subject to either declining landline revenue or the threat of some other technical advance that will obsolete their revenue base.

The pharmaceutical stocks – GlaxoSmithKline (GSK), Merck (MRK), Pfizer (PFE), Novartis (NVS), Johnson & Johnson (JNJ) – to some extent all face major drug patent expirations that could sap revenues.

The oil companies – Royal Dutch Shell (RDSA), BP (BP), ConocoPhillips (COP), Chevron (CVX) and PetroChina (PTR) – face questions on depletion of their reserves, and/or ride the ups and downs of oil prices.

Among those remaining, General Electric (GE) still seems to be sliding sideways and isn’t cheap, with a PE approaching 15. And Pepsico (PEP) is getting the bubbles kick out of it by Coca-Cola (KO).

But Procter & Gamble (PG) is a dividend lover’s dividend stock, with a payout for 121 uninterrupted years, and a record of raising the dividend annually for 55 years. The growth compound rate of growth over that period has been 9.5%, the company says.

Coverage of P&G’s dividend is very comfortable.

Procter & Gamble Dividend Chart by YCharts

And the yield, even with the PE over 15, is higher than 3%. The company has a proven record of market share gains and cost control.

Intel (INTC) also has great coverage for its dividend.

Intel Corporation Dividend Chart by YCharts

Intel is enjoying great revenue growth since the recession, and its PE, at 11, makes it inexpensive. The dividend yield is also over 3%.

P&G and Intel, of course, have issues of their own. But both appear strong and undervalued, according to YCharts Pro.