Exxon reported mixed fourth-quarter results that did have some positive trends, and while earnings came in slightly below estimates, revenues exceeded them. One issue that has kept some pressure on the shares is concern that the long-standing dividend may be cut. Merrill Lynch doesn’t agree and noted this recently:

Suggestions that Exxon’s dividend is at risk misunderstands a decade long strategy of investing at the low end of the cycle. Its sector leading balance sheet is considered strategic and stands best in class despite any borrowings to fund future growth. The company remains the only major with line of sight for a material expansion in cash/flow and dividend growth through the decade.

The company raised the dividend last year $.05 per share to $0.87 per share. That now translates to a massive 5.81% dividend. The $100 Merrill Lynch price objective compares with the $74.10 consensus figure. Exxon Mobil stock closed most recently at $59.88.

Franklin Resources

This company is a mutual fund powerhouse and continues to grow its huge asset base. Franklin Resources Inc. (NYSE: BEN) is among the largest and most global managers. At times, 50% of its sales are from outside the United States, an advantage given a maturing U.S. market.

Franklin Resources offers its products and services under the brands of Franklin, Templeton, Franklin Mutual Series, Franklin Bissett, Fiduciary Trust, Darby, Balanced Equity Management, K2, LibertyShares, and Edinburgh Partners.

The continuing bull market has proven to be a solid tailwind for the company, and while withdrawals from baby boomers may be a concern, the path forward looks solid. The company reported fourth-quarter earnings that came in above expectations, driven by controlled expenses, although revenues were light and outflows were elevated.

Furthermore, the company announced this week it is buying Legg Mason, which gives it additional assets under management now totaling close to $1.8 trillion.

Franklin Resources offers shareholders a 4.15% dividend. Oddly, despite the company’s size and solid balance sheet, no Wall Street firm has a Buy rating. The shares closed on Tuesday at $26.05, above the $24.85 consensus target.

People’s United Financial

This off-the-radar financial institution looks to be offering investors huge value at current trading levels. People’s United Financial Inc. (NASDAQ: PBCT) is a bank and financial holding company. It engages in the provision of commercial banking, retail and business banking, and wealth management services to individual, corporate and municipal customers.

The Commercial Banking segment consists of commercial real estate lending, commercial and industrial lending and commercial deposit gathering activities. The Retail Banking segment comprises consumer lending and consumer deposit gathering activities, as well as merchant services.

The Treasury segment covers the securities portfolio, short-term investments, brokered deposits, wholesale borrowings and the funding center.

The dividend yield is 4.43%. A $17.50 price target accompanies D.A. Davidson’s Neutral rating. The consensus target is $17.40, and the shares closed at $16.03.

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These stocks have sizable upside to the Wall Street targets. They all pay at least a 4% dividend, and very dependable dividends at that. With even moderate appreciation in the share prices of these top companies, investors should be looking at double-digit total return potential. In a market that is very long in the tooth, that makes sense now.