These 20 dividend-paying stocks get a double boost from declining interest rates

Bonds will do well if U.S. interest rates decline in coming months. What you may not appreciate is that dividend-paying stocks are likely to do even better.

“ During declining-rate months, dividend stocks on average did more than twice as well as 10-year Treasurys. ” The comparable returns for 10-year Treasurys, in contrast, are 9.4% and 0.4%, respectively. So during declining-rate months, dividend stocks on average did more than twice as well as 10-year Treasurys.

The key to dividend stocks’ bond-like quality is that their dividends aren’t slashed when interest rates decline. That’s not always the case with lower-quality stocks, whose high yields often indicate an imminent dividend cut. But financially sound blue-chip companies are loathe to cut their dividends, often going to great lengths — including going into debt — to avoid doing so.

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