Best Dividend Paying Stocks – Recap January 2014
It’s time for another recap of the best dividend paying stocks. If you’ll recall, way back in August 2013 I showed you a method developed by Benjamin Graham (Warren Buffet’s teacher) to pick value stocks that pay a dividend. Let’s tune back in to see how these selected stocks have performed over the past ~6 months. You can read more about how to select the best dividend stocks here and see the September 2013 recap here.
Read on to find out how these stocks performed relative to the S&P-500!
Best Dividend Paying Stocks – What Are The Results?
There were a total of nine stocks flagged at the time (8/7/13) using principles put forward by Benjamin Graham. On 9/13/13, I did a quick check in to see how these best dividend paying stocks were performing. At that point in time, they were outperforming the S&P-500 by 6.3%! My how times have changed with these stocks now! The overall results these nine stocks over the past ~6 months is shown in the table below.
| Name | Symbol | 8/7/13 Price | 1/29/14 Price | % Return | Dividend | TOTAL % Return |
| S&P 500 | SPY | 169.18 | 177.35 | 4.8% | 1.1% | 5.9% |
| CNOOC Limited (ADR) | CEO | 177.77 | 154.92 | -12.9% | 1.6% | -11.2% |
| Goldcorp Inc | GG | 25.07 | 24.73 | -1.4% | 1.2% | -0.2% |
| ENSCO PLC | ESV | 58.67 | 50.52 | -13.9% | 2.1% | -11.8% |
| Newmont Mining Corp | NEM | 26.48 | 24.87 | -6.1% | 1.7% | -4.4% |
| Reliance Steel & Aluminum | RS | 68.33 | 69.26 | 1.4% | 1.0% | 2.3% |
| Regal-Beloit Corporation | RBC | 67.13 | 74.49 | 11.0% | 0.6% | 11.6% |
| Compania da Minas Buenaventura SA (ADR) | BVN | 11.65 | 13 | 11.6% | 0.1% | 11.7% |
| OfficeMax Inc | OMX | 11 | 15.26 | 38.7% | 0.4% | 39.1% |
| CDI Corp. | CDI | 15.82 | 17.54 | 10.9% | 1.6% | 12.5% |
| Average for Best Dividend Paying Stocks | 5.5% |
As you can see, overall this basket of stocks has now lagged the S&P-500 by 0.4% 🙁 The two stocks that killed the portfolio performance were CEO and ESV. Both of these companies are associated with offshore drilling of oil and gas. I’m not sure what’s going on there, but it seems like these sort of companies have been hit hard over the past 2-3 months.
In terms of super performers, OfficeMax (OMX) went to the moon because they were bought out by Office Depot. That stock was up a whopping 39.1% in just three months!!
Best Dividend Paying Stocks – How About the September Stock Results?
On 9/13/13, I also included three new stocks that were flagged using the same Benjamin Graham’s method to identify dividend paying value stocks. Let’s see how those have worked out.
| Name | Symbol | 9/13/13 Price | 1/29/14 Price | % Return | Dividend | TOTAL % Return |
| S&P 500 | SPY |
169.33 | 177.35 | 4.7% | 1.1% | 5.8% |
| Diamond Offshore Drilling Inc | DO | 64.41 | 49.16 | -23.7% | 1.2% | -22.5% |
| Helmerich & Payne, Inc. | HP | 68.99 | 85.12 | 23.4% | 0.7% | 24.1% |
| Kennametal Inc. | KMT | 46 | 47.68 | 3.7% | 0.4% | 4.0% |
| Average for Best Dividend Paying Stocks | 1.9% |
As you can see with these new stocks, on average they have performed much worse than the S&P-500 so far 🙁 For whatever reason, it seems that offshore drilling companies are getting absolutely pulverized over the past couple of months.
Best Dividend Paying Stocks – Final Thoughts
This method of seeking out the best dividend paying stocks has not worked so well over the past six months. If you’re going to try and pick your own best dividend paying stocks, definitely ensure you’re well diversified. You can see that from some of the examples above. I’d hate to have put all my eggs in one or two offshore drilling companies (such as DO) and be down ~22.5% right now 🙂
For the time being, I think I’ll stick to investing via market index funds. A good rule of thumb is to allocate only ~5% to dabbling in stock picking. I will be following this rule of thumb for the time being 🙂 I think the best time to look for the best dividend paying stocks is when we’ve had a significant market correction, not when broad market indexes are at all time highs.
