Top DJIA Dividend Stocks Out-Yielding 10-Year Treasury (T, INTC, JNJ, KFT, MRK, PFE, VZ, CVX, DD, GE, MCD, PG, MO)

Now that the 10-Year Treasury Note has been back to close to the 3.00% yields again, we wanted to see which Dow Jones Industrial Average components had a higher dividend yield than the 10-Year Treasury pays to investors.  There are actually 7 of the 30 DJIA stocks out-yielding the 10-Year now and there are many which are right within striking distance today if the shares fall only marginally.  The seven DJIA components currently yielding more than the 10-year Treasury today are AT&T Inc. (NYSE: T), Intel Corporation (NASDAQ: INTC), Johnson & Johnson (NYSE: JNJ), Kraft Foods Inc. (NYSE: KFT), Merck & Company, Inc. (NYSE: MRK), Pfizer, Inc. (NYSE: PFE), and Verizon Communications Inc. (NYSE: VZ).

There is a second group of five stocks which is a group that is “almost” there in dividend yields rivaling the 10-Year Treasury Note.  These five shares have either rallied so that new investors don’t quite get the yield or their payouts are close but not quite there at the 3.20% mark. This group includes Chevron Corporation (NYSE: CVX), E.I. du Pont de Nemours (NYSE: DD), General Electric Company (NYSE: GE), McDonald’s Corporation (NYSE: MCD), and The Procter & Gamble Company (NYSE: PG).  We also cannot forget about former DJIA component Altria Group Inc. (NYSE: MO) as it has an extremely high yield and many still often confuse Big Tobacco for being a DJIA component.

The first group of high dividend payers is the group that out-yields the 10-Year Treasury today.  You will notice that some even out-yield the 30-Year Treasury’s Long Bond of 4.32%.

AT&T Inc. (NYSE: T) is the dividend king of the DJIA today with a 5.50% yield.  At $31.39, Thomson Reuters has a consensus price target of $32.56 and its 52-week trading range is $23.78 to $31.94.  This one even pays more than the Long Bond.

Intel Corporation (NASDAQ: INTC) is showing just what it means to be a high-paying tech dividend stock now that it has just again raised its dividend for the second time in a year.  The new dividend based upon the forward payout here is now 3.57%.  It trades around $23.50 now, Thomson Reuters has a consensus price target of $25.69, and the 52-week range is $17.60 to $23.96.

Johnson & Johnson (NYSE: JNJ) may have recall problems, but it has been a laggard in the market up until recently. It sports a 3.40% yield.  At $66.10, Thomson Reuters has a consensus price target of $69.24 and its 52-week range is now $56.86 to $67.37.

Kraft Foods Inc. (NYSE: KFT) is another DJIA stock which had lagged and lagged, but its defensive nature has led it to hold up better of late.  Despite shares being close to highs it pays 3.31% in dividend yields today.  At $35.00, its consensus Thomson Reuters price target is $35.94 and its 52-week range is $27.59 to $35.10.

Merck & Company, Inc. (NYSE: MRK) is another one of the slow laggards but has help up very well of late as defensive in healthcare.  It sports a 4.10% yield.  At $37.25, Thomson Reuters has a consensus target of $39.52 and its 52-week trading range is $31.04 to $37.68.

Pfizer, Inc. (NYSE: PFE) has been in the same spot as rival Merck, but its current yield is lower at about 3.80%.  With shares at $21.03, its Thomson Reuters consensus price target is $23.44 and its 52-week trading range is $14.00 to $21.21.

Verizon Communications Inc. (NYSE: VZ) is lagging AT&T right now in dividend safety, depending upon how this T-Mobile buyout goes.  Verizon is the runner-up in the king of the DJIA dividends with a dividend yield of $5.30%.  With the stock at $37.34, Thomson Reuters has a consensus price target of $37.88 and the 52-week range is $25.99 to $38.95. This one even pays more than the Long Bond.

Then there is the runner-up group, which will out-yield the 10-Year Treasury note if you have either a price sell-off in shares of if Treasury prices rally any further.

Chevron Corporation (NYSE: CVX) is going to continue to likely chase oil prices.  If oil goes back under $90, then it falls further and the yield rises for new buyers.  If oil goes back to $110, then the price is likely to rise and the new dividend yield will drop.  Chevron pays a 3.00% yield today with shares at $103.75.  Its 52-week range is $66.83 to $109.94 and Thomson Reuters has a consensus price target of $119.47 for the stock.

E.I. du Pont de Nemours (NYSE: DD), or just DuPont, has a surprising dividend yield of about 3.07%.  At $53.30, Thomson Reuters has a share price target target of $63.10 and its 52-week range is $33.73 to $57.00.

General Electric Company (NYSE: GE) is back to a high yield with a 3.00% payout today.  With shares around $19.97, Thomson Reuters has a consensus price target of $24.07 and the 52-week range is $13.75 to $21.65.  GE is still the true cyclical conglomerate that still represents the broad economy more than others.

McDonald’s Corporation (NYSE: MCD) has committed to paying dividends and it has done very well for holders with shares close to all-time highs routinely now.  Its yield is 2.97% but that is because shares have risen.  At $82.00, its consensus Thomson Reuters price target is $86.47 and its prior 52-week range before today was $65.31 to $81.50.

The Procter & Gamble Company (NYSE: PG), one of Buffett’s largest holdings, has a yield of 3.10% and it has been chugging along despite what many are fearing in margins.  At $67.31, Thomson Reuters has a consensus price target of $71.28 and the 52-week range is $58.92 to $67.72.

And lastly…

Altria Group Inc. (NYSE: MO), a.k.a. Big Tobacco, is one which was booted out of the DJIA after it split its international unit out and became Big Domestic Tobacco.  If its dividend was being used, it would be challenging AT&T Inc. (NYSE: T) for its status as “King of the DJIA Dividends” as it yields 5.50%.  AT&T isn’t killing its customers like Altria is, at least we cell phone users hope.

Don’t be surprised when some of these see their dividends raised further this year or next year.  You don’t get to be a DJIA component without reason.

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JON C. OGG