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Invest with the Legends in GE, KKR and Icahn Enterprises

NEW YORK (TheStreet) -- My father, who worked in finance for over five decades, used to say, "There are always good buys in the stock market." This year will be no different, even though the Standard & Poor's 500 Index is down more than 3% for 2014.

If that trend continues, investors could have the opportunity to accumulate shares of high-beta, high-dividend blue-chip stocks such as General Electric (GE - Get Report), Icahn Enterprises (IEP - Get Report) and Kohlberg Kravis Roberts (KKR - Get Report) that should result in attractive long-term returns.

Each of these companies has a dividend yield above the average of 1.9% for a member of the Standard & Poor's 500 Index, and a beta that is greater than 1.

With a beta above 1, the share prices move up and down more than the stock market as a whole. For a patient investor, that allows for buying on the dips. When the price of the stock is lower, the dividend yield is that much higher.

For long-term investors, the stock price should return and rise higher for these entities.

General Electric, a member of the Dow Jones Industrial Average, is a global conglomerate. Its divisions, ranging from finance to water treatment to energy management, operate in more than 160 countries around the world. Earnings-per-share growth is steady and on a bullish trajectory at 6.50% for this year, 6.87% predicted for next year, and 8.48% projected for the half decade ahead. The dividend payout ratio is just 37.40%, so the company will have no problem funding its 3.48% dividend. With a beta of 1.78, patient investors should be able to buy the stock when it declines.

Another conglomerate, Icahn Enterprises has interests in the investment, automotive, railcar and home fashion business, among others. Icahn Enterprises operates differently than General Electric in that it owns separate companies, much like Berkshire Hathaway (BRK.A), the holding company for Warren Buffett, rather than operating different divisions. On a quarterly basis, both sales and earnings-per-share growths are strong. So is the dividend yield at 3.60%.

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GE $24.86 0.24%
IEP $89.81 -1.95%
KKR $22.65 0.27%
AAPL $123.25 -0.80%
FB $83.30 0.35%


DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

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