At 24/7 Wall St., we are always a little dubious about companies that pay double-digit dividends and distributions, but we are equally intrigued by those that continue to pay them over a long period. With most of the current focus on first-quarter earnings results, which for the most part have been outstanding, we decided to look again at some stocks with huge payouts.
We screened our 24/7 Wall St. research database for companies that were rated Buy, paid massive dividends and have been able for some time to keep those dividends coming to investors. We found five stocks that while not suited for the faint-of-heart, could be good shots for aggressive accounts to consider.
This company offers solid value, has zero foreign sales exposure and has kept its dividend intact. CenturyLink, Inc. (NYSE: CTL) is the nation’s third-largest telephone company and the largest rural exchange provider serving residential, enterprise and wholesale customers. It is the product of the acquisition of Embarq by CenturyTel in 2008, Qwest Communications in 2011 and Level 3 Communications in 2017. Embarq is Sprint’s former wireline unit.
With the Level 3 acquisition doing well and things looking up for the company, many analysts are starting to come around on the stock. Merrill Lynch has been positive on the shares for some time, and the firm expects the company’s strong free-cash-flow generation to support the dividend through 2018.
CenturyLink investors are paid a gigantic 12.18% dividend. The Merrill Lynch price target for the shares is $27, while the Wall Street consensus price objective was last seen at $19.74. The stock closed trading on Monday at $17.73 per share.
Energy Transfer Partners
This company merged with Sunoco Logistics Partners to form one of the largest master limited partnerships (MLPs). Energy Transfer Partners L.P. (NYSE: ETP) engages in the natural gas midstream and intrastate transportation and storage businesses in the United States.
The company’s Intrastate Transportation and Storage segment transports natural gas from various natural gas producing areas, and through ET fuel system and HPL system. It owns and operates 7,500 miles of natural gas transportation pipelines and three natural gas storage facilities in Texas. Its Interstate Transportation and Storage segment provides natural gas transportation and storage services; owns and operates approximately 12,300 miles of interstate natural gas pipeline; and has interests in various natural gas pipelines.
The Midstream segment gathers, compresses, treats, blends, processes and markets natural gas. It owns and operates 35,000 miles of in service natural gas, 31 natural gas processing plants, 21 natural gas treating facilities and four natural gas conditioning facilities.
Energy Transfer unitholders are paid a massive 12.12% distribution. Baird has a $22 price target for the stock, though the posted consensus target is $24.10. The shares closed most recently at $18.64.