Top Telecom Stocks Rewarding Shareholders with a Strong Dividend

This stock screen screens for large cap stocks in the Services sector that pay a large dividend.  Criteria for the screen are:

  • A market capitalization of at least $50 billion.
  • The stock trades on an American exchange.
  • Its 5-year average dividend yield is greater than 3%.
  • Its current P/E (excluding extraordinary items) for the last fiscal year is greater than 0.01.  This means that the company’s normal operations are generating a positive net income, which should provide some cash cushion for future dividend payments.  Extraordinary items are excluded from this calculation because we’re using the 5-year average dividend yield for dividend payments, and so any extraordinary items incurred in a particular year should be smoothed out over five years.
  • The company operates in the Services sector.

Our screen returned 6 companies that met those criteria.  Following is some information on them:

  • France Telecom SA (ADR) (NYSE:FTE): This company has a 5-year average dividend yield of 6.78%. It generated $65,356,146,383 in revenues over the last fiscal year, which represents a change of1.47% over the previous year. The stock recently traded at $20.67, its current P/E (excluding extraordinary items) is 10.00, and its market capitalization is $54,593,327,295. About the company:  France Telecom SA provides telecommunications services to residential, professional, and large business customers. The Company offers public fixed-line telephone, leased lines and data transmission, mobile telecommunications, cable television, Internet and wireless applications, and broadcasting services, and telecommunications equipment sales and rentals.
  • Vodafone Group Plc (ADR) (NASD:VOD): This company has a 5-year average dividend yield of 5.31%. It generated $73,428,349,628 in revenues over the last fiscal year, which represents a change of3.18% over the previous year. The stock recently traded at $26.66, its current P/E (excluding extraordinary items) is 11.01, and its market capitalization is $134,748,003,223. About the company:  Vodafone Group Plc provides a range of mobile telecommunications services, including voice and data communications. Vodafone has equity interests in 28 countries and Partner Networks in a further 7 countries with almost all the Group’s mobile subsidiaries operating principally under the brand name Vodafone. In the United States their associated undertaking operates as Verizon Wireless.
  • Telefonica S.A. (ADR) (NYSE:TEF): This company has a 5-year average dividend yield of 5.11%. It generated $87,236,811,301 in revenues over the last fiscal year, which represents a change of7.06% over the previous year. The stock recently traded at $23.74, its current P/E (excluding extraordinary items) is 7.40, and its market capitalization is $108,227,829,634. About the company:  Telefonica S.A. provides telecommunications services mainly to countries in Europe and Latin America. The Company offers fixed-line and mobile telephone, Internet, and data transmission services to residential and corporate customers.
  • Verizon Communications Inc. (NYSE:VZ): This company has a 5-year average dividend yield of 5.10%. It generated $106,565,000,000 in revenues over the last fiscal year, which represents a change of-1.15% over the previous year. The stock recently traded at $36.72, its current P/E (excluding extraordinary items) is 29.31, and its market capitalization is $103,883,800,000. About the company:  Verizon Communications Inc. is an integrated telecommunications company that provides wire line voice and data services, wireless services, Internet services, and published directory information. The Company also provides network services for the federal government including business phone lines, data services, telecommunications equipment and payphones. Competitors to Watch: AT&T, Inc. (NYSE:T), Qwest Communications International Inc. (NYSE:Q), Deutsche Telekom (DTEGY), MetroPCS (NYSE:PCS), Terremark (NASDAQ:TMRK), Qwest (NYSE:Q), CenturyLink (NYSE:CTL), NTELOS Holdings (NASDAQ:NTLS), Vodafone (NASDAQ:VOD), Leap Wireless (NASDAQ:LEAP), Apple (NASDAQ:AAPL), Nokia (NYSE:NOK), Research in Motion (NASDAQ:RIMM) and Sprint Nextel Corp. (NYSE:S).
  • AT+T Inc. (NYSE:T): This company has a 5-year average dividend yield of 4.76%. It generated $124,280,000,000 in revenues over the last fiscal year, which represents a change of1.44% over the previous year. The stock recently traded at $31.26, its current P/E (excluding extraordinary items) is 9.23, and its market capitalization is $185,121,700,000. About the company:  AT&T Inc. is a communications holding company. The Company, through its subsidiaries and affiliates, provides local and long-distance phone service, wireless and data communications, Internet access and messaging, IP-based and satellite television, security services, telecommunications equipment, and directory advertising and publishing. Competitors to Watch: Sprint Nextel Corp. (NYSE:S), MetroPCS (NYSE:PCS), Vodafone (NASDAQ:VOD), Qwest (NYSE:Q), CenturyLink (NYSE:CTL), Cbeyond (NASDAQ:CBEY), Cincinnati Bell (NYSE:CBB), Frontier Communications (NYSE:FTR) and Verizon Communications Inc. (NYSE:VZ).
  • NTT DoCoMo, Inc. (ADR) (NYSE:DCM): This company has a 5-year average dividend yield of 3.03%. It generated $52,271,049,168 in revenues over the last fiscal year, which represents a change of-1.40% over the previous year. The stock recently traded at $17.74, its current P/E (excluding extraordinary items) is 12.21, and its market capitalization is $77,237,736,271. About the company:  NTT DOCOMO, INC. provides various types of telecommunication services including cellular phones, satellite mobile communication, and wireless LAN Network. The Company also sells cellular phones, and other equipment.

(Note: Selected financial data are sourced from screener.co.  All data are assumed to be accurate.)

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