The Dynamic Dividend

10 Stocks With Yields Approaching Post-Recession Highs

When the financial crisis drove the stock market off a cliff, it also pushed dividend yields to incredible heights. Investors with the guts to buy solid dividend-paying stocks during the panic were able to lock in lucrative yields, while those who remained cautious missed out. Luckily, there are still opportunities out there.

Below are ten stocks with yields reaching for new post-recession highs thanks to dividend hikes, lagging share prices, or in some cases, both. Some even provide fatter yields now than they did during the height of the crisis. (Each dividend yield chart goes back to March 2009, when the market hit its generational low. All figures are current as of July 8, 2011.)

Comerica Incorporated (CMA) was one of many financial institutions to slash its dividend during the depths of the recession. But it was also the first among its peers to have redeemed TARP, and thus became the first to give its shareholders a post-recession raise when it doubled its payout in November 2010.

Shares of CMA are currently trading at $33.79, just 2.15% above their 52-week low. At this level, the stock features a 1.18% dividend yield.

Flagstone Reinsurance Holdings (FSR) hasn’t given its shareholders a raise since initiating its payout in 2007, so its rising yield has strictly been a result of a falling share price. The provider of services to the mortgage lending industry has given investors a double-dose of bad news in the last month: The company downgraded its 2011 earnings outlook in mid-June due to falling loan origination activity, and its CEO resigned earlier this month due to health reasons.

Shares of FSR currently trade at $8.31, or 7.64% above their 52-week low. At its current level, the stock features a 1.93% dividend yield.

Lender Processing Services (LPS) hasn’t given its shareholders a raise since initiating its payout in 2008, so all of its yield action has come as an inverse result of (mostly downward) share price movement. Losses have mounted for the reinsurance and insurance holding company as 2011 has already proven to one of the most unprecedented years for significant global catastrophes.

Shares of LPS are currently trading at $20.23, or just 3.74% above their 52-week low. At this level, the stock features a 1.98% dividend yield.

Corporate Office Properties Trust (OFC) has raised its dividend output every year dating back to 1998, earning it Class E Dividend Dynamo status. The real estate investment trust, which mostly leases office and data center properties to government agencies, raised its payout by 5% last September.

Shares of OFC are currently trading at $31.63, or just 3.26% above their 52-week low. At its current price, the stock carries a 5.22% dividend yield.

PartnerRe Ltd. (PRE) recently saw its dividend yield rise completely above its recession peak, as the global reinsurer continued to accelerate its dividend growth even as its shares underperformed in the face of natural disaster losses. The Class E Dividend Dynamo has increased its dividend output every year since 1995 — including three dividend hikes just since the start of 2010 — most recently boosting its payout by 9% in April.

Shares of PRE are currently trading at $69.00, which is just 2.77% above their 52-week low. At this level, the stock yields 3.48%.

Regal Entertainment Group (RGC) slashed its payout by 40% at the height of the crisis, but its yield remained elevated even with the lower payout. The movie theatre operator made some aggressive moves toward the end of 2010, rewarding patient shareholders with a 17% dividend hike and a fat special dividend. But the company’s stock continues to establish new 52-week lows, keeping that yield sky high.

Shares of RGC trade at $11.74, which is just 1.47% above their 52-week low. At this level, the stock features a 7.16% dividend yield.

Molson Coors Brewing Company (TAP) has been left in the dust by the broader market since the beginning of March 2009, gaining just 26% (compared to the S&P 500′s 83% rise) despite consistently raising its payout. The global brewer has increased its dividend in each of the last four years, most recently giving its shareholders a 14% raise in May.

Shares of TAP are currently trading at $44.50, or 4.71% above their 52-week low. At its current price, the stock yields 2.88%. It has never been available for purchase with a yield of 3% or better.

Target Corporation (TGT) has essentially matched the market’s post-bottom gains, so the Class B Dividend Dynamo has leaned on some aggressive dividend growth to reach today’s yield. The discount retailer raised its payout for the 44th consecutive year by giving its shareholders a 20% raise in June. That pushed the stock’s yield over 2.50%, which I highlighted as a rarity. The company has since reported strong June retail sales, pushing its shares off their lows.

Shares of TGT currently trade at $51.14, or 12.03% above their 52-week low. At this level, the stock yields 2.35%.

VSE Corporation (VSEC) may not be a high-yielder, but its dividend rate has far outpaced its stock price, which is virtually unchanged (up four cents) since the start of March 2009. The government contractor raised its dividend three times during the same period, increasing its payout by a total of 56%. VSE’s 17% dividend hike in May was its eighth consecutive annual increase, and pushed its yield over 1% for the first time since the recession began.

Shares of VSEC currently trade at $23.92, which is just 0.76% above their 52-week low. At its current level, the stock features a 1.17% dividend yield.

Wal-Mart Stores (WMT), one of the finest dividend growth stories in the history of retail, increased its payout by 21% in March, which was its 37th consecutive annual increase and biggest dividend hike in four years. That commitment to increasing shareholder returns, coupled with a stagnant share price, has pushed the stock’s yield to not only post-recession highs in recent months, but all-time highs. In fact, the stock’s yield has already increased nearly tenfold since the beginning of this young century.

Shares of WMT are currently trading at $54.08, which is 10.17% above their 52-week low. At this level, the stock features a 2.70% dividend yield. It has never been available for purchase with a yield of 3.00% or higher.