Looking for defensive dividend paying stocks? It makes sense – May is turning out to be one of the worst months in quite some time, with the S&P 500 down over 6%, the DOW down nearly 6%, and the NASDAQ and RUSSELL 2000 Small Caps both down over 7%.
Here are two dividend stocks from our High Dividend Stocks By Sector Tables that have outperformed the market since the start of the spring pullback in April. United-Guardian, (UG), is a NY-based microcap, and Wisconsin Energy, (WEC), is a large cap electric utility:
Performance: Both UG and WEC have beaten the market quite handily in these time periods…
But things get really interesting, when you look at their performance during rallies and pullbacks over the past 11 months.
With a 5%-plus dividend yield, United Guardian, (UG), is one of the top dividend paying stocks in the Consumer Goods section of our High Dividend Stocks by Sector tables. UG recently reported record earnings for Jan-Sept. 2009, achieving 20% growth over the same period of 2008. Net sales were also up 8% compared to Jan-Sept. 2008.
UG negotiated significant price discounts for its main raw ingredient, which cut their cost of sales by 10%, and flowed right through to higher earnings.
The increased earnings has prompted UG to declare a $.32/share increased dividend, payable on Jan. 4, 2010, to shareholders of record on Dec. 18. This dividend brings 2009’s total dividends declared to $.60/share, a 5.77% yield at today’s $10.77 price.
UG also looks like one of the best stocks in the Personal Products group:
Personal Products Industry
UG also has a 5-year dividend growth rate of over 40%, vs. an industry average of 11.12%. Their dividend payout ratio is approx. 79%.
Disclosure: No positions yet.
Disclaimer: This article is written for informational purposes only.