3 Dividend Stocks Smoking the S&P 500

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This article originally appeared on Traders Reserve.

Things have been pretty rough for the equity markets since they hit their 52-week highs back in late April. The broad-based measure of the domestic market, the S&P 500 Index, has pulled back significantly since climbing to those highs, and if we look a little further back in time, we find that over the past three months, the S&P 500 is down 1.8%. Yet it’s been quite a different story for many blue-chip dividend stocks

What this tells us is that the big money has been migrating toward the relative safety of dividend stocks, and if we see more downside in the market at large, the best of these income-generating equities could be the place for your money.

Here are five dividend stocks smoking the S&P 500:

Dividend Stock #1 – Altria Group (MO)

One stock that’s both metaphorically and literally smoking the S&P 500 is tobacco giant Altria Group (NYSE: MO). The company recently raised its annual quarterly dividend to 38 cents per share from 35 cents, with a current annual dividend yield of 5.5%. Over the past three months, MO shares have been on fire, surging 7.4% versus the essentially flat S&P 500 over the same period. A potential catalyst for more upside in the shares is a Massachusetts jury ruling in favor of parent company Philip Morris (NYSE: PM), in a case brought in 2001 involving Marlboro cigarettes.

Dividend Stock #2 – H.J. Heinz (HNJ)

As the summer approaches, all across the country there’ll be plenty of ketchup put on hot dogs and hamburgers. And no doubt, the top brand of ketchup being slowly poured will be made by H.J. Heinz (NYSE: HNZ). That company just recently thickened up its quarterly dividend, raising it 6.7% to 48 cents per share. Over the past three months, HNZ shares have delivered 8.8% gains. If that weren’t enough, the stock delivers a current annual yield of a tasty 3.6%.

Dividend Stock #3 – International Paper (IP)

Mega-cap paper and packaging giant International Paper (NYSE: IP) has really been on a tear of late, with the shares jumping 12.7% over the past three months. The company just made a $3.3 billion hostile takeover bid to buy smaller rival Temple-Inland Inc. to cement its leading position in North America’s corrugated packaging business. Additionally, in late March, the company increased the green kind of paper it pays to shareholders by upping its quarterly dividend 40% to 26.25 cents per share form 18.75 cents. The recent dividend hike is the third such payout increase in the past year. As of this writing, the annual yield on IP shares was a robust 3.5%.

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Article printed from InvestorPlace Media, https://investorplace.com/2011/06/dividend-stocks-to-buy-mo-hnz-ip/.

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