by Gordon Pape, editor Internet Wealth Builder
Here's a look at
5 of stocks that are on our core list of U.S. recommendations. These
are not necessarily those we expect will outperform the markets; rather,
they are all large, mature companies.
However, these companies
carry less risk because of their size and stability and they all pay a
dividend to provide cash flow. If you can't decide what stocks to buy,
your shopping list should start here.
is the largest telecom company in the world in terms of revenue ($127.4
billion in 2012). AT&T is usually thought of as an iconic U.S.
company but in fact it operates around the globe with voice coverage in
more than 225 countries, data roaming in more than 205 countries, and
mobile broadband in more than 145 countries.
[Related -General Electric Company (GE) Q4 Earnings Preview: Feeling The January Effect]
It also competes
with cable companies, offering an Internet Protocol (IP) based
television service called U-verse TV. As well, it manages the largest
Wi-Fi network in the States.
The company's 2012 results showed
earnings of $7.3 billion ($1.25 a share, fully diluted). Free cash flow
was $39.2 billion, a company record. The market cap is a mind-boggling
$193 billion. The stock pays a dividend of $1.80 per share (annualized)
to yield 5.3%.
General Electric (GE)
[Related -T-Mobile US Inc (NYSE:TMUS): AT&T Inc.(NYSE:T) Could Suffer In Wireless War]
is the company that does everything, which makes it impossible to
categorize. It manufactures appliances, light bulbs, healthcare
equipment, jet and helicopter engines, locomotives, gas turbines, and
It builds residential home communities and lends billions
of dollars to individuals and corporations through GE Capital. It's a
world leader in research in such areas as fibre optics and health
technology. The company's technology helps to deliver one-quarter of all
the electricity used in the world.
all that just scratches the surface. Its history dates all the way back
to Thomas Edison and the invention of the electric light. GE is often
seen as a proxy for the American economy and as such is a must on any
list of core stocks.
That said, it hasn't been much of a
profit-maker for investors in the past three years, trading for much of
the time in a narrow range of $18 to $22. Recently, however, the moving
averages have started to trend slightly higher, which is encouraging. In
the meantime, investors are collecting an annual dividend of $0.76 a
share for a yield of 3.4%.
For 2012, GE reported revenue of
$147.4 billion and net earnings attributable to shareholders of $13.9
billion ($1.29 per share). The company has a market cap of $231 billion.
Kinder Morgan (KMI)
Morgan is the largest midstream and the third largest energy company
(based on combined enterprise value) in North America. The company owns
an interest in or operates approximately 75,000 miles of pipelines and
The company's main holding in Canada is the
Trans-Mountain pipeline, the only oil line linking Alberta with the West
Coast. Kinder Morgan has made an application to twin the line, which
would more than double its capacity.
The company reported
revenue of just under $10 billion in 2012 and a profit of $1.3 billion.
On Jan. 16, Kinder Morgan announced a 19% increase in its quarterly
dividend to $0.37 a share ($1.48 annualized).
At the same time,
the company said it expects its 2013 dividend will total $1.57 a share.
If that estimate holds up, the stock will yield 4.2% this year. The
market cap is $27.9 billion.
company needs no introduction. There's probably not a single person
reading this who has not had a McDonald's burger at some point.
1955, the Golden Arches have been pulling in customers by the billions
around the world. Today the company has 34,000 restaurants worldwide,
where 1.8 million employees serve nearly 69 million people every day in
This fast-food goliath generated revenue of
almost $27.6 billion in 2012 and reported net income of about $5.5
billion ($5.36 per share, fully diluted). The stock pays a quarterly
dividend of $0.77 ($3.08 a year) to yield 3.3%. Market cap is $93.7
The Walt Disney Company (DIS)
other company could we possibly choose for the entertainment sector?
Disney is entertainment! From the days of Steamboat Willie back in the
1920s, Disney has evolved into one of the world's most recognized
The company is involved in almost every aspect of the
entertainment industry: television (ABC and ESPN), theme parks (five in
existence and a sixth being built in Shanghai), cruise ships, consumer
products, the Internet, and, of course, movies where it all began.
is a cash machine, generating revenue of $42.3 billion in the 12 months
to Sept. 30/12. Disney has a market cap of $94.6 billion and pays an
annual dividend of $0.75 a share to yield 1.4%.