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Stocks Under $10 with 50-100% upside potential - 14 days FREE!

15 Cheap High-Dividend Stocks for Defensive Investors

Stocks in this article: NLY CTL ETR DUK AEP XEL COP

The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK ( Insider Monkey) -- We like high-dividend stocks because they tend to outperform the market when everything else is going down. In addition, we consider high-dividend stocks as alternatives to 10-year Treasury bonds in this current low-interest environment. We believe the recent downturn in the stock market has given defensive investors a great opportunity to add such high-yielding stocks in their portfolios.

Below, we provide a list of 15 mega-cap U.S stocks with high dividend yields and low price-to-book ratios. The market data are sourced from Fidelity. All companies in this list have market capitalizations above $10 billion, an annualized dividend yield of at least 3%, a current P/E ratio lower than 15 and a price-to-book ratio of less than 1.5. Since the beginning of this year, these stocks returned -5.16 % vs. -3.52 % for the SPY.

Annaly Capital Management (NLY) owns, manages and finances a portfolio of real estate related investments. NLY has a 15.02% dividend yield and returned -1.74% since the beginning of this year. The stock has a price-to-book ratio of 1.01 and a P/E Ratio of 5.63. Among the 300+ hedge funds we track, Bill Miller had the largest NLY position at the end of the second quarter.

CenturyLink (CTL) is a leading integrated communications company providing Internet services in the United States. CTL has an 8.65% dividend yield and lost -23.37% since the beginning of this year. The stock has a price-to-book ratio of 1.01 and a P/E Ratio of 14.21. Adage Capital held more than $100 Million of CTL in Q2 2011.

Entergy (ETR) is an integrated energy company engaged primarily in electric power production and retail electric distribution operations. ETR has a 4.98% dividend yield and lost -3.68% since the beginning of this year. The stock has a price-to-book ratio of 1.39 and a P/E Ratio of 9.50. Jean-Marie Eveillard had more than $150 Million in ETR at the end of June 2011.

Duke Energy (DUK) is a large energy company operating in the United States. DUK has a 4.94% dividend yield and gained 16.48% since the beginning of this year. The stock has a price-to-book ratio of 1.20 and a P/E Ratio of 13.16. Michael Messner and Israel Englander were the most prominent DUK investors in Q2.

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