Jim Cramer’s Top Three Dividend Stocks: GIS, PFE, T
“Investors looking for a holiday gift that keeps on giving should turn to high yielding dividend stocks,” Jim Cramer said on Monday’s “Mad Money” TV show. With this in mind, Cramer highlighted three names, stocks with superior dividends that rank among his top picks for this market. His first choice was General Mills Inc. (NYSE:GIS). “It’s a household name with some of the world’s most beloved brands, like Cherrios, Pilsbury and Betty Croker,” Cramer said. General Mills currently yields 2.8%, and due to favorable changes to the tax code and compounding dividends, the stock has yielded 7.5% over the last 10 years. Plus, the company recently raised its dividend from $0.47 per share to $0.49. “When a company raises its dividend, that’s management saying: we have the cash, we have the growth and we believe that things are betting better,” Cramer said. He mentioned that General Mills is a safe stock and has earnings per share that are 2.3 times the dividend payout. “This is one stock investors can own for the long term,” he said. Next up is Pfizer Inc. (NYSE:PFE), a stock Cramer said he hated prior to it’s game-changing takeover of Wyeth, which he expects to create $4 billion on costs savings while expanding the company’s pipeline and product portfolio. After slashing its dividend in half earlier this year, Pfizer now yields 3.9% with plenty of room to run. Cramer thinks Pfizer can pay out $46 billion in dividends while also paying down $34 billion in debt between 2010 and 2015, with $28 billion of cash left over. The stock is near a 52-week high, and Cramer said the dividend is safe now because the company’s earnings could cover the dividend three times over. He reminded viewers to buy the stock by Feb. 2 in order to qualify for Pfizer’s next big payout. Last but not least, Cramer recommended AT&T Inc. (NYSE:T), which currently yields 6.1% after boosting its dividend up to $0.42 per share. Cramer called AT&T a conservative way to play the mobile Internet tsunami and he said it was his favorite pick of the three. “It’s a big, safe Telco company, and its big exposure to the coming mobile Internet boom is enough to swing a big company like this,” Cramer said. He told viewers to buy the stock by Jan. 5 in order to qualify for the dividend payout. Get the scoop on tomorrow’s hottest trade ideas – TODAY! BeaconEquity.com PREMIER PICKS have an amazing track record. Join this select group and ride the profit wave!
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