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Tom Lee: Give these 'dividend orphans' a home

Pedestrians walk past a mobile phone store in New Delhi, India.
Prashanth Vishwanathan | Bloomberg | Getty Images

The hunt for yield this year has resulted in few dividend payers left to buy cheaply, except for a few so-called dividend orphans that have been overlooked, according to widely followed strategist Thomas Lee.

"The global search for yield has driven outperformance of most dividend payers. However, we have identified several laggards with materially better dividend yields, positive fundamental outlooks, strong balance sheets, and reasonable payout ratios," wrote Lee, head of research at Fundstrat Global Advisors.

Lee defines dividend orphans as stocks that have been left out from major benchmarks, have short or inconsistent dividend histories, or possess challenging fundamentals. The lack of attention from investors has led many of these companies to underperform, even though some of them pay decent dividends and have the potential to turn the corner.