In a tough bear market like this one, finding yield can be treacherous. But Karen Finerman has some ideas on where to look.
First things first -- what’s a dividend yield?
According to Investopdia, it’s “a financial ratio that shows how much a company pays out in dividends each year relative to its share price. It’s calculated as follows:
Annual Dividends Per Shares
Price Per Share
Typically, a higher dividend yield is considered desirable because it suggests a stock is under priced.
Now -- what's the trade?
Karen Finerman recommends looking at Philip Morris and Diageo. “They’re both companies with good balance sheets and their underlying businesses are stable,” she says.
And in case you’re wondering, Finerman says to avoid CBS and the N.Y. Times. She suggests CBS may have to cut their dividend and "the Times may have to cut further.”