5/16/2014 7:45 PM ET
Dividend stocks lead 10 hot picks
Need an antidote for this fitful market? StockScouter's latest batch of recommended stocks is loaded with steady, high-yield names like Verizon.
Compiled from StockScouter ratings by Verus Analytics
If 2014's turbulent market has you looking to the relative safety and blissful boredom of large-cap dividend stocks -- especially after Thursday's thrashing -- you're not alone.
Warren Buffett's Berkshire Hathaway (BRK.A) took up a $524 million position in telecommunications giant Verizon (VZ) during the first quarter, according to new filings with the Securities and Exchange Commission released Thursday. Billionaire hedge fund manager John Paulson also bought a stake in Verizon, worth about $416 million at the end of March.
Verizon, which pays a 4.4 percent dividend, is just one of the many high-yield stocks on StockScouter’s latest list of 10 stocks to watch.
Leading the list for a second straight week is Washington, D.C.-area electric utility Pepco Holdings (POM), which offers investors a 3.9 percent yield. And Verizon rival AT&T (T), which pays a generous 5 percent dividend, has been a mainstay of StockScouter's Top 10 since February.
New to the list this week, though, is telecom services provider CenturyLink (CTL), which rewards investors with a hefty 5.7 percent yield. Rounding out StockScouter’s top five is asset management firm Blackstone Group (BX), which pays a 4.8 percent dividend.
- Also on MSN Money: Warren Buffett’s 5 top dividend stocks
Verizon shares get a '9' from the StockScouter rating system on MSN Money, where 10 is the highest score possible. Based on StockScouter’s analysis, shares of VZ are expected to significantly outperform the market over the next six months with very low risk.
Read the full Scouter report on Verizon here.
StockScouter Top 10 for May 16
Pepco Holdings (POM)
Delta Air Lines (DAL)
Blackstone Group (BX)
Huntington Bancshares (HBAN)
Southwest Airlines (LUV)
StockScouter beats the market
We think the StockScouter rating system developed by Verus Analytics for MSN Money is one of the best tools you can use when you're trying to decide where to invest.
StockScouter looks for stocks whose business fundamentals, price behavior, valuation and stock-ownership characteristics appear to predict a rising price in the future, based on how those factors have influenced stock prices in the past.
The system assigns each stock an expected six-month return and balances that return against the stock's expected volatility.
Scouter rates stocks on a scale of 1 to 10, and ratings can change daily. Ratings and data in the chart above were current as of this article's publication date.
In addition to the daily top 10 list described above, StockScouter is used by investment research firm Verus Analytics (previously known as the quantitative business unit of Gradient Analytics) to generate a monthly benchmark portfolio of stocks that, refreshed monthly, has outperformed the market since its inception in August 2001.
An investor who began in 2001 by investing in each of the benchmark portfolio's top 10 stocks at the start of the month, selling them at the end of the month and then starting fresh with a new group of 10 stocks, would have generated returns, before trading costs and taxes, of 1,026 percent through April 30, 2014.
Writer Jon Markman, at the time a columnist for MSN Money, collaborated with company researchers on the tool.
Markman suggested rolling over the top 10 stocks every six months to hold down trading costs, a strategy that might be a better fit for most investors; that would yield different results, which would vary based on your starting point.
Performance through April 30, 2014
Full 50 position portfolio
Top 10 portfolio
Inception: August 2001
VIDEO ON MSN MONEY
I agree with the comments, more so then the Charts...
But many/most times 9-10 ratings are based on TTM (trailing 12 months); as much as they are on guidance.
And "Poorman" I also agree with several of your picks, they have performed as well or better and better dividends.
We own some (2-3) of that stuff, and a couple similar to what's on the above list or charts...
Only difference is we have far "outperformed" the majority of there picks and the S&P in those timeframes.....Except the "since conception" metric.??
They change and reallocate often, so I'm not sure of their strategies...?? Except what is mentioned above.
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Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
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