With Santa Claus rally over here come the Dogs
By Dian Vujovich
It’s official: The Santa Claus rally has come, gone and scored well. Now it’s time to identify what companies are included in the 2013 Dogs of the Dow lineup. After that it’s 12 months of wait-and-see on both fronts.
According to Jeff Hirsh, editor in chief of the Stock Trader’s Almanac, the Santa Claus rally ended on Jan. 3rd with Santa scoring positively during the seven days of that rally. So, for those who believe in Santa Claus, the rest of 2013 ought to be a positive one.
For the record, the DJIA closed up 1.5 percent between 12/21/12 and 1/3/13, the S&P 500 up 2 percent, and Nasdaq up 2.6 percent according to WallStreetSectorSelection.com. Meaning, Santa did indeed come to town.
Before moving on to the Dogs of the Dow, Hirsh’s father came up with a little ditty about that rally that’s kind of cute and goes like this: ” If Santa Claus should fail to call, bears may come to Broad and Wall.”
Now for this year’s Dogs of the Dow.
As a reminder, the idea behind the Dogs of the Dow investing strategy is to invest in the 10 highest yielding stocks in the Dow Jones Industrial Average. Why? Because those stocks not only are yielding a lot but they’ve also fallen out of favor with the investing public. Hence, their per share price might be higher at year’s end than it was on the last day of the preceding trading year.
With no further adieu, here are the Dogs of the Dow 2013:
-AT&T (T) closed 2012 at $33.71 per share with a dividend yield of 5.34 percent.
-Verizon (VZ) at $43.27 per share had a 4.76 percent dividend yield when it closed last year.
-Intel’s (INTC) year-end yield of 4.36 percent was based upon a closing price of $20.62.
-Merck & Co. (MRK) at a closing price of $40.94 had a yield of 4.20 percent.
-Pfizer (PFE) had a year-end yield of 3.83 percent based upon a closing price of $25.08 per share.
-Du Pont De Memours (DD) ended last year at $44.98 and yielding 3.82 percent.
-Hewlett-Packard (HPQ) at $14.25 per share yielded 3.72 percent at year-end 2012.
-General Electric (GE) wound up last year with a yield of 3.62 percent at a share price of $20.99.
-McDonald’s (MCD) per share price of $88.21 yielded 3.49 percent when last year ended.
-Johnson & Johnson (JNJ) closed 2012 at $70.10 and yielding 3.48 per share.
One interesting thing about all of these Dogs is that each and every one of them has a yield that’s about triple the yield anyone who has money invested in a money market fund is getting.
Good luck to all Dog lovers.
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