Members of Congress Own These High Dividend Stocks, Should You?

Members of Congress Own These High Dividend Stocks, Should You?

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So Congress is full of millionaires. Did you know some of that income comes from high dividend stocks?

Milestone alert: for the first time in history, the majority of the 534 members currently serving in Congress are millionaires. The Center for Responsive Politics, a nonpartisan organization that tracks money in US politics, analyzed the latest personal financial disclosures filed in 2013 and discovered that 268 members have an average net worth of at least $1 million. According to the Center, only 48% of Congress, or 257 members, were millionaires the previous year.

Generally, Democrats were wealthier than Republicans, with $1.04 million in median net worth compared to almost $1 million for the GOP. Senators also tend to have more money than Representatives, with a median net worth for the former of $2.7 million versus the latter’s $896,000.

Investing ideas

As part of its analysis, the Center for Responsive Politics compiled a list of the 50 most popular investments within Congress in 2012. We began our screen with that group of stocks, which we subsequently narrowed down by looking for stocks with a dividend yield of 3% or greater.

For our second screen, we decided to incorporate a profitability metric and isolated those with a return on equity (ROE) greater than the industry average. ROE measures a firm's profitability by expressing a company's profits as a percentage of shareholder equity.

We were left with nine high dividend stocks on our list.

Click on the interactive chart below to see returns over time.

Do you think members of Congress are on the right track with these dividend stocks? Use this list as a starting point for your own analysis.

1. Kraft Foods Group, Inc. (KRFT, Earnings, Analysts, Financials): Operates as a consumer packaged food and beverage company in North America.

Market cap at $32.38B, most recent closing price at $54.42.

Dividend yield at 3.86%.

Return on Equity at 45.50% vs. an industry average of 23.30%.

A total of 22 members of Congress invested in Kraft Foods Group in 2012, making it the 43rd most popular stock on the Hill. The minimum Democratic investment was $7007 while the minimum Republican investment was $160,893, with 7 Democrats and 15 Republicans owning stock.
 

2. Kimberly-Clark Corporation (KMB, Earnings, Analysts, Financials): Engages in the manufacture and marketing of health care products worldwide.

Market cap at $40.39B, most recent closing price at $105.43.

Dividend yield at 3.07%.

Return on Equity at 39.90% vs. an industry average of 24.00%.

A total of 22 members of Congress invested in Kimberly-Clark Corp in 2012, making it the 41st most popular stock on the Hill. The minimum Democratic investment was $128,010 while the minimum Republican investment was $2,140,199, with 9 Democrats and 12 Republicans owning stock.
 

3. Ford Motor Co. (F, Earnings, Analysts, Financials): Develops, manufactures, distributes, and services vehicles and parts worldwide.

Market cap at $64.65B, most recent closing price at $16.40.

Dividend yield at 3.05%.

Return on Equity at 31.20% vs. an industry average of 16.80%.

A total of 19 members of Congress invested in Ford in 2012, making it the 48th most popular stock on the Hill. The minimum Democratic investment was $23,656 while the minimum Republican investment was $108,288, with 8 Democrats and 11 Republicans owning stock.
 

4. ConocoPhillips (COP, Earnings, Analysts, Financials): Operates as an integrated energy company worldwide.

Market cap at $84.11B, most recent closing price at $68.32.

Dividend yield at 4.04%. Return on Equity at 16.50% vs. an industry average of 9.80%.

A total of 21 members of Congress invested in ConocoPhillips in 2012, making it the 45th most popular stock on the Hill. The minimum Democratic investment was $1,033,007 while the minimum Republican investment was $299,514, with 6 Democrats and 15 Republicans owning stock.
 

5. McDonald's Corp. (MCD, Earnings, Analysts, Financials): Operates as a foodservice retailer worldwide.

Market cap at $94.96B, most recent closing price at $95.22.

Dividend yield at 3.40%.

Return on Equity at 36.70% vs. an industry average of 30.10%.

A total of 41 members of Congress invested in McDonald's Corp in 2012, making it the 19th most popular stock on the Hill. The minimum Democratic investment was $356,817 while the minimum Republican investment was $921,661, with 18 Democrats and 23 Republicans owning stock.
 

6. Cisco Systems, Inc. (CSCO, Earnings, Analysts, Financials): Designs, manufactures, and sells Internet protocol (IP)-based networking and other products related to the communications and information technology industry worldwide.

Market cap at $120.52B, most recent closing price at $22.41.

Dividend yield at 3.03%.

Return on Equity at 17.20% vs. an industry average of 14.50%.

A total of 53 members of Congress invested in Cisco Systems in 2012, making it the 9th most popular stock on the Hill. The minimum Democratic investment was $138,249 while the minimum Republican investment was $477,582, with 22 Democrats and 30 Republicans owning stock.
 

7. Intel Corporation (INTC, Earnings, Analysts, Financials): Engages in the design, manufacture, and sale of integrated circuits for computing and communications industries worldwide.

Market cap at $132.05B, most recent closing price at $26.51.

Dividend yield at 3.39%.

Return on Equity at 17.90% vs. an industry average of 8.60%.

A total of 51 members of Congress invested in Intel Corp in 2012, making it the 10th most popular stock on the Hill. The minimum Democratic investment was $179,432 while the minimum Republican investment was $626,453, with 25 Democrats and 26 Republicans owning stock.
 

8. Pfizer Inc. (PFE, Earnings, Analysts, Financials): Offers prescription medicines for humans and animals worldwide.

Market cap at $204.01B, most recent closing price at $31.00.

Dividend yield at 3.35%.

Return on Equity at 32.20% vs. an industry average of 17.80%.

A total of 47 members of Congress invested in Pfizer Inc in 2012, making it the 14th most popular stock on the Hill. The minimum Democratic investment was $303,420 while the minimum Republican investment was $1,273,122, with 19 Democrats and 28 Republicans owning stock.
 

9. Microsoft Corporation (MSFT, Earnings, Analysts, Financials): Develops, licenses, and supports a range of software products and services for various computing devices worldwide.

Market cap at $298.37B, most recent closing price at $35.78.

Dividend yield at 3.13%.

Return on Equity at 29.20% vs. an industry average of 23.40%.

A total of 65 members of Congress invested in Microsoft Corp in 2012, making it the 3rd most popular stock on the Hill. The minimum Democratic investment was $1,759,463 while the minimum Republican investment was $1,875,589, with 32 Democrats and 33 Republicans owning stock.
 

 

(List compiled by Mary-Lynn Cesar. Annual return data sourced from Zacks Investment Research. Industry ROE data sourced from Yahoo! Finance. All other data sourced from Finviz.)

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