The nearly decade-long era of ultra-low interest rates has been kind for dividend-paying stocks. Not only have they often offered payouts that are more robust than the yield on 10-Year Treasuries, but they have also racked up spectacular share price gains.
The SPDR S&P Dividend ETF (SDY) for example, has rallied an impressive 215% since the market bottomed out in March, 2009.
But income-oriented investors now face a changing backdrop. Rising bond yields are now surpassing the payout levels of many dividend producers. To stay ahead of the curve, you need to focus on firms that have a long history of rising dividends in any economic climate. That means "dividend aristocrats."
Here are five that currently offer dividend yields ahead of the 10-Year Treasury rate.
1. Abbott Labs (ABT)
This healthcare firm has boosted its payout for 44 straight years (and at least maintained its dividend for a stunning 92 years). To be sure, dividend growth will be modest this year, as earnings are expected to be flat. But analysts are looking for a 12% hike in earnings next year, which should portend a more robust dividend hike. Meanwhile, the current dividend yield stands at 2.50%, just a tick above the 10-Year Treasury yield of 2.49%.