4 Large US Dividend-Paying Small Caps for Big Second-Half Gains

The company also manages separate client-focused equity, fixed income, balanced and money market mutual funds, along with separate client-focused equity, fixed income, money market and balanced portfolios. Through its subsidiaries, the firm invests in the public equity and fixed income markets across the globe.

Investors receive a 3.33% dividend. Jefferies has a $34 price target on the stock, and the consensus price objective is $29.50. The shares closed Monday at $30.

Flowers Foods

This company recently raised its dividend payout to shareholders. Flowers Foods Inc. (NYSE: FLO) produces and markets bakery products in the United States. It operates through two segments, Direct-Store-Delivery (DSD) and Warehouse Delivery. The DSD segment produces and markets fresh bakery foods, including fresh breads, buns, rolls, tortillas and snack cakes.

The company offers its products under the Nature’s Own, Wonder, Whitewheat, Cobblestone Bread Company, Tastykake, Home Pride, Merita, Dave’s Killer Bread, Country Kitchen and Roman Meal brand names, as well as markets franchised and licensed brands, such as Sunbeam, Bunny and Holsum. It operates 39 bakeries, as well as sells its products through DSD route delivery model to retail and foodservice customers.

Shareholders receive a very attractive 3.56% dividend. The $22 Jefferies price target compares with the consensus target of $19 and the most recently closing share price of $17.99.

Packaging Corporation of America

This company has seen some insider selling recently. Packaging Corp. of America (NYSE: PKG) manufactures and sells containerboard and corrugated packaging products in the United States, Europe, Mexico and Canada. The company’s Packaging segment offers various corrugated packaging products, such as conventional shipping containers used to protect and transport manufactured goods; multi-color boxes and displays that help to merchandise the packaged product in retail locations; and honeycomb protective packaging. This segment also produces packaging for meat, fresh fruit and vegetables, processed food, beverages and other industrial and consumer products. Two other segments also contribute significant revenue.

The Jefferies analysts have noted in the past that the company’s Boise purchase in 2013 is still yielding benefits as it continues to improve operations. With a solid and consistent franchise and a reliable dividend, it makes good sense for more conservative accounts.

Investors are paid a solid 3.26% dividend. The Jefferies price target is posted at $75, and the consensus target is $69.17. The stock closed most recently at $67.57 a share.

These are four of the best small cap stocks doing a majority of their business in the United States that all pay dividends above 3%. With total return remaining a solid investment path for equity investors, these all are good selections for buy and hold portfolios looking to add alpha.

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