One of my favorite types of stocks to look for and own is one with low volatility and that issues a nice dividend. When I say “nice” dividend, I do not mean one so high that there is no possible way the company can sustain such a high payout for too long. The companies that I like to look for are the dividend aristocrats. These are the companies that have not only had a sustainable dividend over the last 25 years, but they have also increased each year. As a whole, they have a slightly higher payout, while also having slightly lower volatility than the S&P 500. In 2012, there were ten companies added to the list.
One of these companies is telecommunications giant AT&T (T). With a beta of 0.46, AT&T is about half as volatile as the market. The company’s stock performance over the last 12 months shows that there was no significant swing in either direction as the company varied from the upper $20s to lower $30s per share. The company does have a very nice dividend yield of 5.7%, dishing out $1.76 to investors annually. The company also has a higher price to earnings ratio than the S&P 500 at 46.7, but it is right about the average of the industry at 40.2. Two of the biggest named competitors in AT&T’s industry are Sprint (S) and Verizon (VZ).
Over the last year, Sprint’s stock price has been hit hard.To continue reading, click here.