As yields on U.S. Treasurys have dropped to the lowest levels since October, the "Fast Money" traders on Thursday looked for yield elsewhere. They shared their top high-yielding stock picks.
To some, the utilities sector "just doesn't seem sexy enough," but Veracruz founder Steve Cortes noted these stocks have outperformed the overall market for some time now and often boast healthy dividend yields. The utilities are also domestic businesses, he added, so they have no exposure to Europe's ongoing sovereign debt crisis. He likes Southern Company in particular because its stock currently pays a 4.3 percent dividend yield.
RiverTwice Capital's Zachary Karabell agreed with Cortes about going to the utilities for yield. Karabell prefers the iShares S&P Global Utilitiesexchange-traded fund , though.
Stuart Frankel's Steve Grasso is also looking to the utilities for high-yielding stocks. He's a buyer of both Dominion Resources , as well as the Utilities Select Sector SPDR ETF. Both D and XLU yield at just under 4 percent right now, he noted.
When it comes to high-yielding ETFs, Karabell suggests the SPDR Barclays Capital High Yield Bond and the iShares iBoxx $ High Yield Corporate Bond .
"You're not taking the individual name risk and if the price goes down when people get freaked, the yields will go up," Karabell said of JNK and HYG. "So these are good, albeit still risky, vehicles to play the names."
Meanwhile, trader Guy Adami is finding yield outside of the utilities space. Adami likes drug manufacturer Pfizer's stock because it boasts a 3.9 percent dividend yield. He also remains bullish on home improvement retailer Home Depot and fast food giant McDonald's , which both happen to sport a 2.9 percent dividend yield right now.
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Trader disclosure: On Dec. 15, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders: Adami owns C; Adami owns GS; Adami owns MSFT; Adami owns INTC; Adami owns AGU; Adami owns NUC; Adami owns BTU; Cortes is long SO; Cortes is long TSN; Cortes is short crude; Cortes is short AAPL; Grasso owns ASTM; Grasso owns AVAV; Grasso owns BA; Grasso owns D; Grasso owns LIT; Grasso owns MHY; Grasso owns PFE; Grasso owns PRST; Grasso owns S; Grasso owns XLU;
Steve Grasso
Stuart Frankel & Co and it’s partners own CSCO
Stuart Frankel & Co and it’s partners own CUBA
Stuart Frankel & Co and it’s partners own GERN
Stuart Frankel & Co and it’s partners own HPQ
Stuart Frankel & Co and it’s partners own HSP
Stuart Frankel & Co and it’s partners own HSPO
Stuart Frankel & Co and it’s partners own MET
Stuart Frankel & Co and it’s partners own MSFT
Stuart Frankel & Co and it’s partners own MU
Stuart Frankel & Co and it’s partners own NYX
Stuart Frankel & Co and it’s partners own PRST
Stuart Frankel & Co and it’s partners own UAL
Stuart Frankel & Co and it’s partners own XRX
Francisco Blanch
No disclosures
Mark McKechnie
ThinkEquity LLC makes a market in Apple Inc., Intel Corporation, Motorola Mobility Holdings, Inc., Nokia Corporation, QUALCOMM Inc. and Research In Motion Limited securities; and/or associated persons may sell to or buy from customers on a principal basis.
Andy Busch
No disclosures
David Ross
United Parcel Service, Inc. is on the Stifel Nicolaus Income Opportunity Ideas List. This Income Opportunity Ideas List represents our Stifel Nicolaus analysts’ best yield ideas, however is not intended to represent a model portfolio. Each stock is on the Buy List, and offers what Stifel Nicolaus analysts believe are companies with solid fundamentals, a favorable valuation, and a current dividend higher than that of the S&P 500 Index. Stifel, Nicolaus & Company, Inc. makes a market in the securities of United Parcel Service, Inc.. Stifel, Nicolaus & Company, Inc. expects to receive or intends to seek compensation for investment banking services from United Parcel Service, Inc. in the next 3 months.
FedEx Corporation is on the Stifel Analyst Select List. This Select List includes companies that Stifel Nicolaus analysts believe have the potential for the greatest total return in each of their respective areas of coverage over approximately the next 12 months. In some cases, analysts who cover more than one sub-sector may have more than one name on the list. Stifel, Nicolaus & Company, Inc. makes a market in the securities of FedEx Corporation. Stifel, Nicolaus & Company, Inc. expects to receive or intends to seek compensation for investment banking services from FedEx Corporation in the next 3 months.
David Wong
Wells Fargo Securities, LLC maintains a market in the common stock of Advanced Micro Devices Inc., Altera Corp., Analog Devices, Inc., Broadcom Corp., Intel Corp., Linear Technology Corp., Maxim Integrated Products Inc., Micron Technology, Inc., Nvidia Corporation, QUALCOMM Inc., Texas Instruments Inc., Xilinx Inc.
Wells Fargo Securities, LLC or its affiliates intends to seek or expects to receive compensation for investment banking services in the next three months from Advanced Micro Devices Inc., Altera Corp., Analog Devices, Inc., Broadcom Corp., Intel Corp., Linear Technology Corp., Maxim Integrated Products Inc., Micron Technology, Inc., Microsemi Corp., Nvidia Corporation, QUALCOMM Inc., Texas Instruments Inc., Xilinx Inc.
Wells Fargo Securities, LLC and/or its affiliates, have beneficial ownership of 1% or more of any class of the common stock of Analog Devices, Inc., QUALCOMM Inc.
Intel Corp., Micron Technology, Inc., QUALCOMM Inc., Texas Instruments Inc. currently is, or during the 12-month period preceding the date of distribution of the research report was, a client of Wells Fargo Securities, LLC. Wells Fargo Securities, LLC provided noninvestment banking securities-related services to Intel Corp., Micron Technology, Inc., QUALCOMM Inc., Texas Instruments Inc.
Wells Fargo Securities, LLC received compensation for products or services other than investment banking services from Intel Corp., Micron Technology, Inc., QUALCOMM Inc., Texas Instruments Inc. in the past 12 months.
Wells Fargo Securities, LLC or its affiliates may have a significant financial interest in Advanced Micro Devices Inc., Altera Corp., Analog Devices, Inc., Broadcom Corp., Intel Corp., Linear Technology Corp., Maxim Integrated Products Inc., Micron Technology, Inc., Microsemi Corp., Nvidia Corporation, QUALCOMM Inc., Texas Instruments Inc., Xilinx Inc.
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