Diary of a Dividend Diva: D-Day for Dividends

 | Sep 07, 2012 | 10:00 AM EDT
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Let's cut to the chase. Next Tuesday, Sept. 12, is a HUGE day for dividends.

The chart below shows all the names going ex-div that day. If we regularly feast at the table of dividend income, this is like walking up to the Rio Carnival World Buffet, the world's largest. Here are that day's payers (I also threw in a few on Sept. 13 for good measure):

Keep in mind that this list represents the names that pass my dividend screen, which factors in size of the company, trading volume, size of the dividend, etc.  All are reasonably good targets for you to play the dividend. The names I am playing in my fund are highlighted.

Altria (MO) -- A quarterly favorite. The tobaccos are far and away the best group for dividend rotation. The yields are good and the business models (and therefore stock prices) are stable. I regularly rotate through MO, Philip Morris (PM), Reynolds American (RAI) and Lorillard (LO).

NYSE Euronext (NYX) -- Exchanges and payment processors are great businesses. They pick up pennies by processing gargantuan volumes of transactions for miniscule fees. The cost of their infrastructure, computer technology, goes down every year. And they have a modicum of pricing power. But the exchanges are at the mercy of market fluctuations, so you don't want to play NYX during a correction. Still, the markets are benign at the moment and the yield is good, so you are likely to get in and out quickly.

Garmin (GRMN) -- A perennially high yielder in a sector (technology) not known for yield. Garmin might have longer-term issues, as smartphone subsume the GPS function, but that doesn't matter. You are only going to own it for a few weeks at most.

Prologis (PLD) -- This logistics leader pays a fat, REIT-esque dividend. The FedEx (FDX) miss gives me concern about logistics names, so you don't want to own this over reporting season, but it should be safe to buy now and sell before month end.

Merck (MRK) -- Big pharma, cash flow and a stable business. Another group, like tobaccos, that are good for rotation every quarter.

Columnist Conversations

I reached out last week to my close friend Ken Shreve, who is a prominent writer for the IBD.  I asked Ke...
I reached out last week to my close friend Ken Shreve, who is a prominent writer for the IBD.  I asked Ke...
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