Ten Stocks for Yield and Value

06/08/2016 9:00 am EST

Focus: STOCKS

Kelley Wright

Managing Editor, Investment Quality Trends

High quality dividend paying stocks offer the greatest probability over the long-term to generate real total-returns, asserts Kelley Wright, editor of Investment Quality Trends.

Interest rates will not pose a threat for the remainder of the year and probably into the next. This is not to say that the Fed will not increase the rate of Fed Funds, but if they do, at all, it will be in very small baby steps.

As such I believe that dividend yields will be more attractive than the coupon rate offered by fixed income.

The Timely Ten is not just another “best of, right now” list. Rather, it is our reasoned expectation based on our methodology and experience that these ten currently undervalued stocks offer the greatest real total-return potential over the next five years.

Eaton Vance (EV) — yielding 3.06%
American Express (AXP) — yielding 1.81%
Franklin Resources (BEN) — yielding 2.05%
Texas Instruments (TXN) — yielding 2.66%
Emerson Electric (EMR) — yielding 3.67%
Cummins (CMI) — yielding 3.49%
Omnicom (OMC) — yielding 2.39%
Fluor (FLR) — yielding 1.68%
Target Stores (TGT) — yielding 3.03%
Wal-Mart Stores (WMT) — yielding 3.08%

Do we believe that all 10 will appreciate simultaneously or immediately? Of course not.

However, our five-plus decades of research and experience, however, leads us to believe that these stocks, purchased at current undervalued levels, are well positioned for both growth of capital and income.

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By Kelley Wright, Editor of Investment Quality Trends

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