Investing

5 Blue Chip Stocks to Buy That Pay at Least 5% Dividends

courtesy of Ford Motor Co.

Despite multiple Federal Reserve interest rate increases, and the prospect of yet another one in December, long-term rates have gone nowhere. While the stock market has boomed for growth investors, those that look for growth and income have not had near as much upside. The good news is there are some quality companies for investors to consider that pay outstanding dividends and have solid upside potential.

We screened our 24/7 Wall St. research database and found five top blue chip stocks that all pay at least a 5% dividend. While not suitable for ultra-conservative accounts, they look to be just the ticket for growth and income investors looking for total return.

AT&T

This stock has bounced off the lows but is still down from highs printed in January. AT&T Inc. (NYSE: T) is the world’s largest provider of pay TV, with TV customers in the United States and 11 Latin American countries. In the United States, the AT&T wireless network has the nation’s self-described strongest 4G LTE signal and most reliable 4G LTE. The company also helps businesses worldwide serve their customers better with mobility and highly secure cloud solutions.

With its shares trading at a very cheap 12.8 times estimated 2018 earnings, the company continues to expand its user base, and strong product introductions from smartphone vendors have not only driven traffic but increased device financing plans.

AT&T has several major catalysts that will likely drive strong network traffic demand: DirecTV Now and Mobile, “Data-Free TV” for DirecTV/U-verse subscribers, and increasing penetration of unlimited data plans. Many on Wall Street believe that the company is well-positioned to address ongoing traffic requirements, with additional LTE capacity available and the ability to leverage small cell deployments.

AT&T investors receive a huge 5.08% dividend. The Wall Street consensus price objective is $41.03. Shares traded early Monday at $38.75.

Blackstone

This top money management company makes solid sense for more aggressive growth and income investors. Blackstone Group L.P. (NYSE: BX) is one of the largest global alternative asset managers. It manages investments and provides services.

Blackstone also launches and manages private equity funds, real estate funds, funds of hedge funds, and credit-focused funds for its clients. It invests in private equity, public equity, fixed income and alternative investment markets.

Blackstone investors are paid an outstanding 6.9% distribution. The consensus price target is $38.68, and shares were last seen at $33.25.

Ford

This is a solid value play now, and demand could spike because of the recent hurricanes. Ford Motor Co. (NYSE: F) is one of the world’s largest vehicle producers, with over 6 million units manufactured and sold globally. The company has made significant progress executing on its One Ford plan and delivering best-in-class vehicles. The company also remains committed to positioning itself well within the evolving auto industry through balanced investments across electrification, autonomy and mobility services.

You can bet that numerous F-150 pickup trucks were damaged by Hurricane Harvey, and it remains the top-selling vehicle in the United States. Toss in the company’s revamped sport utility vehicle lineup and reasonable stock price, and investors could do well adding shares here.

Shareholders receive a 5.07% dividend. The consensus price target is $11.91. Shares were last seen at $12.00.

Helmerich & Payne

This company primarily operates as a contract drilling company in South America, the Middle East and Africa. Helmerich & Payne Inc. (NYSE: HP) provides drilling rigs, equipment, personnel and camps on a contract basis to explore for and develop oil and gas from onshore areas and fixed platforms, tension-leg platforms and spars in offshore areas

Many top Wall Street analysts feel that the company is one of the best positioned for the U.S. land recovery, and they also cite the strong balance sheet and the sector-leading dividend.

Helmerich & Payne investors are paid a big 5.49% dividend. The consensus price objective is $51.70. Shares traded at $52.15 on Monday.

Vodafone

This European telecom company tends to fly under investors radar and buying its shares makes very good sense now. Vodafone Group PLC (NASDAQ: VOD) has been scorched and offers a solid entry point here. The company offers voice, messaging and data services across mobile and fixed networks; broadband and TV services; cloud and hosting, as well as internet protocol-virtual private network services; roaming services; and unified communications services.

It also provides M-Pesa, a mobile money transfer and payment service, and Vodafone One, an ultra-high-speed fixed broadband service with Ono Fibre, home landline, 4G mobile telephony and Vodafone TV.

In addition, Vodafone offers Internet of Things products, which includes communication between devices via mobile technologies; international voice transit and roaming; carrier services, such as fixed and mobile connectivity and other services; and smartphones and tablets. The company serves 462 million mobile, 13 million fixed broadband and 9.5 million TV customers. It sells its products primarily through branded stores, distribution partners and third party retailers.

Vodafone shareholders receive an outstanding 5.74% dividend. The Wall Street consensus price target is $35.28, The shares traded Monday at $28.70.

These companies make sense for growth and income portfolios. They are big, safe and, best of all (for the time being), all the dividends look safe.

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