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Macy's and other top dividend-paying stocks are lagging the S&P 500 in 2020

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Macy's and other top dividend-paying stocks are lagging the S&P 500 in 2020

Some of the highest-paying dividend stocks are the worst performers this year -- Macy's, Schlumberger, AltriaFord and Kraft are all in the red in 2020.

Is the hunt for yield worth the cost? Matt Maley, chief market technician at Miller Tabak, said at least one of those names is worth a second look.

"The one that looks the best, on a technical basis anyway, is Schlumberger. It's the only one of those names that is above its trend line going back to the middle of 2018. And it's also the only one that's made any kind of a higher high in the last few months," Maley said Wednesday on CNBC's "Trading Nation."

"If it can make a higher low above $30 and follow that up with another higher high above $40 that'd be really, really bullish for the name. I must admit I'm still looking for another washout in crude oil so the higher low might come still in the low $30s rather than the mid-$30s. But of all those stocks, that's probably the one that looks the best," said Maley.

Schlumberger is currently trading at $34.13. A higher high above $40 implies at least a 17% rally from current levels. It briefly traded above $40 in early January.

John Petrides, portfolio manager at Tocqueville Asset Management, said it's still too early to buy into any of these stocks.

"All the companies mentioned really have structural issues," Petrides said during the same segment. "If you're going to invest in this group of securities your question is 'what's your, what's your investment intention?' If you're looking purely for incoming yield, I would stay away from these stocks because the quality of the income is not very high."

Macy's, for instance, yields 9%. But, concerns over sales and viability in a changing retail space have pushed the stock 34% lower over the past 12 months.

"These stocks are a show-me story first, they're a turnaround play first, and the yield is all gravy if management gets it right," said Petrides.

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