Growth stocks get beat up the most during market downturns like the one that has taken place in recent month. High flyers with absurd valuations come tumbling down when investors head for the exits. In a bearish looking market, investors should turn to the safety of dividends for solace. Dividends from companies with solid balance sheets and lots of cash flows are one of the surest bets that you can make in the market. Let’s take a look at a few high paying dividend stocks.
Lockheed Martin (LMT) may not offer a whole lot when it comes to rapid earnings growth in the future but the stock has been a solid income play. Lockheed Martin has increased its dividend for eight consecutive years with the latest increase coming last year. The defense contractor boosted its payout 19% last fall. Lockheed pays out a $3 per share dividend and has a yield of 4.2%.
Kimberly Clark Corporation (KMB) continues to prove that there is good money in toilet paper, tissues, and diapers as the company is a dominant player in the consumer staples sector. Kimberly Clark has a dividend that you can take to the bank. The company has increased its dividend for 39 consecutive years and has a dividend yield of 4.2%. The nearly $2 billion dollars generated in annual free cash flow will make it possible for the company to keep paying its $2.80 per share dividend.
Paychex (PAYX) is one of the leading companies in the payroll processing industry with the company’s chief competitor being ADP. Paychex trades at 17 times earnings which may seem expensive until you see that most competitors trade at valuations twice the value of Paychex. Paychex is an attractive stock because the company generates $600 million dollars in free cash flow and has absolutely no debt. The company has a dividend of $1.24 per share and is yielding 4.8%. Investors should keep an eye on this dividend since it represents nearly 80% of the company’s earnings per share.
AT&T (T) has made the list again as the company is one of the highest yielders in the market. AT&T investors know all about the company’s long history of annual dividend increases. The telecommunications company is currently yielding 6.2% which should be attractive to any fixed income investor. Even if the stock does not move for a year or two, this yield makes the stock a great income play.