SocGen Identifies The 40 Best Dividend Stocks In The World

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In this worrisome global macro backdrop, many are pointing to dividend paying stocks as a way to generate income while waiting for capital gains.Societe Generale is out with its report of the top 40 dividend payers across the globe. 

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The latest list includes stocks from the U.K., Australia, Brazil, Switzerland, France, Canada, and Japan. European companies, which have some of the biggest market caps among the group, tend to pay dividends on an annual basis.  But the size of the European dividend payouts can be volatile.

Note: SocGen ranks the companies based on blend of 2011 dividends as well as company-specific characteristics. Forecasts are a blend of a variety of consensus sources like Bloomberg, FactSet, and IBES. Data is derived from free float shares, and one off special dividends have also been removed. Share prices used to determine the ranking are for January 23, 2012.

AT&T announced that it was increasing its quarterly dividend to $0.44 for 2012

Sector:
Fixed line telecom (U.S.)

2011 Yield:
5.6 per cent

AT&T pre-announces dividend payments and on Dec. 16, it announced that it was increasing its quarterly dividend to $0.44 for 2012, with payment due on Feb 1 2012. AT&T is currently yielding 5.9 per cent and is the most important payer of dividends worldwide.

Source: Societe Generale

Telefonica is cutting its 2012 dividend payment target

Sector:
Fixed line telecom (Spain)

2011 Yield:
12.0 per cent

Telefonica is cutting its 2012 dividend payment target of €1.75 to €1.50 because of tough a regulatory environment and challenging business conditions.

Source: Societe Generale

Exxon Mobil is expected to increase dividends in 2012

Sector:
Oil & gas producers (U.S.)

2011 Yield:
2.1 per cent

When matched for previous patterns, ExxonMobil should pay $0.47 on or around March 8, 2012, and then increase dividends in the following three quarters. Consensus is for a full year dividend of $1.955, 'or an unexciting net yield of 2.3 per cent.'

Source: Societe Generale

Vodafone is expected to account for £1 in every £8 of dividends paid by companies in the FTSE100 index

Sector:
Mobile telecom (U.K.)

2011 yield:
7.6 per cent

Excluding any special dividend for 2012/13, the consensus figure of £10.19 is as per Vodafone's own target of growth of at least 7 per cent. Vodafone is expected to account for £1 in every £8 of dividends paid by companies in the FTSE100 index.

Source: Societe Generale

Nestle is expected to increase its annual dividend despite a drop in earnings

Sector:
Food producers (Switzerland)

2011 Yield:
3.6 per cent

Nestle pays an annual dividend that is expected on Feb. 16, and is expected to increase by 4.9 per cent to 1.94 Swiss francs, despite a drop in earnings. The company has a 64 per cent payout ratio--which is the dividends per share divided by the earrings per share--and the company is yielding 3.6 per cent.

Source: Societe Generale

General Electric is expected to post a 17 per cent increase in its 2011 dividend

Sector:
General industrials (U.S.)

2011 Yield:
3.6 per cent

On 9 December 2011, General Electric said it was raising the quarterly run-rate to $0.17 for the Q1 2011 payment. 'Extrapolating this for 2011FY, would give a total dividend of $0.68, a 17 per cent increase on last year or a yield of 3.6 per cent.'

Source: Societe Generale

HSBC's dividend will be impacted by currency swings

Sector:
Banks (U.K.)

2011 Yield:
4.8 per cent

HSBC is listed in the U.K. but reports dividends every quarter in U.S. dollars, and pays in a range of currencies like the U.S. dollar, the Hong Kong dollar and the pound.

'Currency swings mean that the dividend paid may come as a pleasant surprise or a rather nasty shock. Consensus forecasts expect EPS to increase 33% for 2011FY but the dividend to rise by 11% to US$0.4. On these numbers, HSBC is yielding 5.3%, covered 2.3 times expected earnings.'

Source: Societe Generale

Banco Santander recently increased its total outstanding shares

Sector:
Banks (Spain)

2011 Yield:
9.9 per cent

Banco Santander has a complex dividend program but SocGen focused just on cash amounts. The current consensus is for €0.60 for 2011FY, unchanged from 2010. On these numbers however Banco Santander is yielding 8.9 per cent, and on January 3, 2012. The number of shares outstanding further increased following the conversion of 77.7 million preference shares, into 341 ordinary shares.

Source: Societe Generale

Total's dividend is expected to increase by 2.6 per cent in 2012

Sector:
Oil & gas producers (France)

2011 Yield:
5.7 per cent

While the consensus EPS forecast is expected to rise by 13 per cent for 2011, the dividend of €2.28 is unchanged on last year, and is only expected to increase by 2.6 per cent for 2012. 2011 results will be confirmed on Feburary 10, and current consensus is for a continuation of the €0.57 dividend for Q4 2011.

Source: Societe Generale

Microsoft isn't expected to increase dividend for fiscal year 2012 - 2013

Sector:
Software and computer services (U.S.)

2011 Yield:
2.6 per cent

Microsoft's financial year ends in June, and analysts are not factoring any dividend growth for fiscal year 2012 - 2013. On Dec. 14, however they announced that they would pay $0.20 for the second quarter.

Source: Societe Generale

Chevron had said it would increase its quarterly dividend payment for Q4 2011

Sector:
Oil & gas producers (U.S.)

2011 Yield:
2.9 per cent

Back in October, Chevron said it would increase its quarterly dividend payment for Q4 2011 to $0.81. 'Moving consensus forecasts forward one year and extrapolating the quarterly payment for 2011, would give a full year dividend of $3.32, a 7.4% increase on last year.'

Source: Societe Generale

Johnson & Johnson's quarterly dividends for the next three quarters see a six per cent increase in 2011

Sector:
Pharma & bio (U.S.)

2011 Yield:
3.4 per cent

Johnson & Johnson has confirmed that it would pay a dividend of $0.57 for Q1 2011. It is expected to give a quarterly dividend of $0.605 for the next three quarters or a 6 per cent increase on 2011.

Source: Societe Generale

Pfizer should see a 12 per cent increase in FY2012 dividend, over the previous year

Sector:
Pharma & bio (U.S.)

2011 Yield:
3.7 per cent

Pfizer announced a Q1 2012 dividend of $0.22, and consensus is for a continuation of the annualized rate through the year--giving $0.88 for fiscal year 2012, or a 10 per cent increase on last year.

Source: Societe Generale

Royal Dutch Shell (A) has adjusted its dividend calendar with the launch of its scrips program

Sector:
Oil & gas producers (Netherlands)

2011 Yield:
4.8 per cent

Royal Dutch Shell's dividends are announced in U.S. dollars, but the default payment currencies are euros for RDS.A and Sterling for RDS.B, but shareholders can choose which currency they receive their dividends in.

Shell's scrip dividend program lets shareholders choose whether they want to receive dividends in cash or in shares. And the dividend calendar year has been adjusted to allow shareholders to make their scrip decisions.

'The consensus forecast of $0.42 (unchanged on the previous 12 quarters) when translated into Sterling or euros (at current exchange rates) would mean a 9.3 per cent increase in Sterling terms or 17.1 per cent increase in euros when compared to 2010Q4.'

Source: Societe Generale

Novartis has removed its restriction on limiting dividend payments to 35 - 60 per cent

Sector:
Pharma & bio (Switzerland)

2011 Yield:
4.4 per cent

Novartis pays just one annual dividend in Swiss Francs. The company changed its dividend policy in July 2011 saying it was removing the restriction that limits the payment of dividends to 35 - 60 per cent of net income. On recent numbers, Novartis is yielding 4.3 per cent.

Source: Societe Generale

Procter & Gamble's fourth quarter dividend is expected to increase to $0.57

Sector:
Household & home (U.S.)

2011 Yield:
3.2 per cent

P&G has a June year-end, and it announced a third quarter dividend of $0.525, on January 10, 2012. Fourth quarter dividend is expected to increase to $0.57, giving a full year dividend of $2.145, up 9 per cent on the previous year.

Source: Societe Generale

Verizon Communications does not expect more dividend payments from Verizon Wireless

Sector:
Fixed line telecom (U.S.)

2011 Yield:
5.1 per cent

Though Verizon Wireless made a one-off $10 billion dividend payment to its owners Verizon Communications and Vodafone, last year, Verizon Communications' CEO said it wasn't possible to have a policy of annual dividend payments by Verizon Wireless, because it wanted to use the cash to secure more spectrum or make acquisitions.

On the dividend front, Verizon announced it would pay a Q4 2011 dividend of $0.50, in line with the previous quarter. Consensus is for $0.50 for the first and second quarters, rising to $0.505 for the third and fourth quarter, or $2.01 for fiscal year 2012. On these numbers, Verizon is yielding 5.2 per cent.

Source: Societe Generale

Commonwealth Bank of Australia is expected to announce a full year 2012 dividend of AU$3.39

Sector:
Banks (Australia)

2011 Yield:
6.6 per cent

'For the full fiscal year 2012, consensus is expecting a dividend of AU$3.39, meaning that Commonwealth Bank of Australia is yielding 6.7 per cent.'

Source: Societe Generale

GlaxoSmithKline's expected to report dividend of £20

Sector:
Pharma & bio (U.K.)

2011 Yield:
4.8 per cent

Consensus forecasts an uplift to £20.0 for Q4 2011, giving a total of £69.0. On these numbers GlaxoSmithKline is yielding 4.6 per cent. Looking ahead to 2012, consensus is currently forecasting a 5.8 per cent increase in the dividend to £73.0.

Source: Societe Generale

BP is expected to double its Q4 dividend to $0.28

Sector:
Oil & gas producers (U.K.)

2011 Yield:
3.9 per cent

BP declares dividends in U.S. dollar but pays shareholders in pounds, with the exchange rate calculated as an average over the four dealing days prior to the Sterling equivalent being announced.

Q4 2011 results have been confirmed for 7 February 2012 and payment is due on 13 March 2012. In dollar terms, the dividend is expected to double to $0.28.

Source: Societe Generale

Westpac is expected to see its dividend increase 4.5 per cent in 2012

Sector:
Banks (Australia)

2011 Yield:
7.9 per cent

Westpac has a September year end, and announced a second half dividend of AU$0.8, on top of the AU$0.76 paid at the half year stage, or a 12.2 per cent increase over the prior year. Looking forward to 2012, expectations are for the dividend to increase 4.5 per cent to AU$1.67. On current numbers, Westpac is yielding 8.1 per cent for 2012FY.

Source: Societe Generale

Roche wants to grow the dividend in line with core EPS growth

Sector:
Pharma & bio (Switzerland)

2011 Yield:
4.2 per cent

Roche has said that it aims to grow the dividend in line with core EPS growth and that it would at least maintain the 6.6 Swiss francs paid for 2010FY. Dividend forecasts have come down slightly and consensus now expects a 3 per cent increase to 6.8 Swiss francs, meaning that Roche is currently yielding 4.1 per cent.

Source: Societe Generale

Philip Morris dividends are expected to rise 10 per cent in 2012

Sector:
Tobacco (U.S.)

Yield:
3.8 per cent

Philip Morris publishes a dividend calendar, and announces dividend payments ahead of schedule. For the full year 2011, dividends rose by 15.6 per cent to $3.24.

For 2012 dividend payments are expected at $0.77 for the first and second quarters, rising to $0.85 for the third and second quarters, giving a total of $3.56, a 10 per cent increase on 2011. On these numbers Philip Morris is yielding 4.2 per cent.

Source: Societe Generale

Merck increased its 2011 dividend by 2.6 per cent but its final 2012 dividend payment looks light

Sector:
Pharma & bio (U.S.)

Yield:
3.8 per cent

For the full year 2011, Merck increased its dividend by just 2.6 per cent. Going by the company's historic pattern, if we assume three equal quarters of $0.42 for 2012 Q1, Q2 and Q3, then the final variable payment would be $0.43, which looks a little light. On current consensus forecasts for 2012, Merck is yielding 4.2 per cent.

Source: Societe Generale

JPMorgan Chase's bounce back in dividend payments is expected to contribute to growth from the financials sector for 2012

Royal Dutch Shell (B) can expect a 9.3 per cent increase in Sterling terms or 17.1 per cent increase in euro terms

Sector: Oil & gas producers (Netherlands)

Yield: 4.6 per cent

'The consensus forecast of $0.42 (unchanged on the previous 12 quarters) when translated into Sterling or euros (at current exchange rates) would mean a 9.3 per cent increase in Sterling terms or 17.1 per cent increase in euros when compared to 2010Q4.'

Source: Societe Generale

Sanofi-Aventis 2011FY dividend is expected to increase by 4 per cent

Sector:
Pharma & bio (France)

2011 Yield:
4.7 per cent

Sanofi-Aventis reports results on a quarterly basis but pays just one annual dividend. In 2011, the company warned that earnings would be down due to increased pricing pressure and threats from generic competition.

That said, the 2011FY dividend is forecast to increase by 4 per cent to €2.6. It also offers a scrip dividend alternative and 58% of shareholders in 2010 opted to receive their dividend in shares.

Source: Societe Generale

Coca Cola's Q1 dividend is expected to increase by 9.6 per cent

National Australia Bank is expected to report a dividend increase of 7.6 per cent for the first half

Sector:
Banks (Australia)

2011 Yield:
7.7 per cent

National Australia Bank has a September year end and announced fiscal year end results back in September 2011, reporting a full year dividend of AU$1.72, up 13 per cent.

Looking forward, NAB will release first half results on May 10 and consensus expects a 7.6 per cent increase in the dividend to AU$0.9.

Source: Societe Generale

Intel is expected to make payments of $0.21 each quarter during 2012

Sector:
Technology (U.S.)

2011 Yield:
3.2 per cent

Intel is another U.S. company which pre-announces dividend payments ahead of actual results. Dividends for both Q3 2011 and Q4 were previously confirmed at $0.21 a share. 2011FY results were released on January 19, but there was no indication given of what to expect dividend wise for Q1 2012.

Going by historical patterns however, consensus assumes payments of $0.21 for each quarter during 2012 or $0.84 for the full year, a 7.7 per cent increase.

Source: Societe Generale

ANZ Banking Group will announce results for the first half of 2012 in May

Sector:
Banks (Australia)

2011 Yield:
7.0 per cent

ANZ has a September year end. Its Fiscal 2012H1 results will be announced on 2 May 2012. Current consensus forecasts of AU$0.665 is a 3.9 per cent increase on the same period a year earlier.

Source: Societe Generale

BAT's expected dividend looks light but is in line with expected increase in earnings

Sector:
Tobacco (U.K.)

2011 Yield:
4.3 per cent

British American Tobacco increased its first half dividend by 15 per cent and consensus currently expects a 2011H2 dividend of £89, a 9.4 per cent increase over the same period a year earlier. While this figure looks a little light, it is in line with the expected increase in earnings.

Source: Societe Generale

Wells Fargo's dividend payment for 2012 is likely to miss expectations

Sector:
Banks (U.S.)

2011 Yield:
2.4 per cent

Wells Fargo announced it would pay a 2011Q4 dividend of $0.12 in line with previous quarters, paying $0.48 for the year. In January, the company said it was continuing the $0.12 annualized rate for Q1 2012, which was way off expectations.

The 2012FY consensus forecast of $0.72, or four equal payments of $0.18--a 50 per cent increase on 2011 -- now looks highly unlikely.

Source: Societe Generale

Wal-Mart had said it would increase dividends by 20 per cent

Sector:
General retailers (U.S.)

2011 Yield:
2.4 per cent

Wal-Mart has a January year end and the company pre-announces its quarterly dividend schedule at the beginning of each fiscal year.

'In March last year, Wal-Mart said that it would increase dividends by 20 per cent, paying $1.46 in four equal installments of $0.365. Looking ahead to fiscal year 2013 consensus expectations haven't budged, forecasting an increase of 10 per cent to $1.61, which means Wal-Mart is yielding 2.4 per cent.'

Source: Societe Generale

BHP Billiton is expected to post a 9.5 per cent increase in dividend for the first half of 2012

Sector:
Mining (Australia)

2011 Yield:
2.9 per cent

BHP Billiton reports results and announces dividends in US dollars but pays in a range of currencies, including the pound, the Australian dollar, the New Zealand dollar, and the South African rand. Results for the first half of 2012 have been confirmed for February 8. Consensus forecasts a 9.5 per cent increase in the first half dividend to $0.46.

Source: Societe Generale

Siemens is expected to increase dividend by 3.3 per cent in 2012

Sector:
General industrials (Germany)

2011 Yield:
4.0 per cent

In November 2011, Siemens said it was raising its dividend by 20 per cent to €3.0. This is after its 70 per cent dividend increase for 2010.

Now, consensus expectation for fiscal 2012 is for a 3.3 per cent increase to €3.1, giving a yield of 4.0 per cent. The company has stated that it intends to pay out up to 50 per cent of earnings going forward.

Source: Societe Generale

ENI's dividend payment is expected to be a 4 per cent increase on 2010

Sector:
Oil & gas producers (Italy)

2011 Yield:
6.1 per cent

'Continuing the historical pattern, consensus expectations haven't budged and forecast an additional €0.52, as per the 2011 dividend paid in September, which would equate to a 4 per cent increase on 2010FY.'

Source: Societe Generale

IBM's quarterly dividends are expected to increase through 2012

Sector:
Software and computer services (U.S.)

2011 Yield:
1.6 per cent

IBM said it would pay a Q4 2011 dividend of $0.75, totalling $2.9 for 2011, a 16% increase. IBM is due to announce what it will pay in dividends for Q1 2012. Assuming the historical pattern, a further $0.75 is expected, and then the quarterly payments should see an up-lift for the remainder of 2012.

Expectations are for subsequent quarter payments of $0.783 giving $3.1 for 2012 (a 7 per cent increase).

Source: Societe Generale

France Telecom's dividends will be impacted by its cash flow since earnings are already set to decline

Vale (Pref A) is expected to boost its dividends by 32 per cent this year

Sector:
Mining (Brazil)

2011 Yield:
7.4 per cent

Vale usually pays an interim dividend in April each year and a second half dividend in October, but last year Vale gave two interims, one extraordinary and two additional payments. Vale is now expected to give its first interim dividend sometime in April.

'That said, we have no idea what to expect with regards a normal cash dividend payment. Consensus forecasts don't seem to make much sense when compared to historical payments. Excluding extraordinary and additional payments, dividends last year rose by 58%. Earnings this year are expected to increase by 40% and (assuming the consensus number doesn't include any specials), dividends are forecast to increase by 32%. Remember that these figures are all meant to be gross. So, excluding all the special payments, Vale is yielding 3.5% net of Brazilian withholding taxes (and not the 9%+ figure usually banded about).'

Source: Societe Generale

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