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3 Large-Cap Stocks With High Forward Dividend Yields

In terms of dividend yield, the following securities are outperforming the S&P 500 Index, which rewarded its shareholders with a 1.87% yield at market close on Sept. 13.

Analysts on Wall Street also assigned positive recommendation ratings ranging between overweight and buy, reinforcing the idea these three large-cap stocks represent profitable businesses. Overweight means the stock is expected to outperform either the industry or the entire market.


The first company is Westpac Banking Corp. (NYSE:WBK), whose shares closed at $20.46 on Friday with a market capitalization of $39.02 billion. The forward dividend yield of 6.43% is 330 basis points higher than the industry median of 3.13% and 456 basis points higher than the S&P 500's yield as of Friday.

The Australian global bank has paid dividends since July 28, 1989. The company distributed a quarterly dividend of 65.8 cents per common share to its shareholders on July 5.

The stock also has a price-book ratio of 1.6 versus the industry median of 1.03 and a price-sales ratio of 4.88 compared to the industry median of 2.9.

The stock gained 3% over the past 12 months through Sept. 13. Shares are trading above the 200-, 100- and 50-day simple moving average lines. The 52-week range is $16.41 to $20.86.

GuruFocus assigned a low rating of 2.8 out of 10 for the company's financial strength and a 3 out of 10 rating for its profitability and growth.

The 14-day relative strength index of 72 suggests the stock is not far from overbought levels.

Sell-side analysts on Wall Street issued an overweight recommendation rating and an average target price of $19.62.

The second company is Dominion Energy Inc. (NYSE:D), whose shares closed at $78.52 on Friday with a market capitalization of $63.08 billion.

The Richmond, Virginia-based energy production and transportation company has a forward dividend yield of 4.67%, which is 137 basis points higher than the industry median of 3.3% and 280 basis points higher than the S&P 500's dividend yield.

Dominion Energy has paid quarterly dividends for 33 years. On Sept. 20, the company will pay 91.8 cents per common share to its shareholders.

The company also has a price-book ratio of 2.05 versus the industry median of 1.43 and a price-sales ratio of 3.89 versus the industry median of 1.36. The enterprise value-Ebitda ratio is 18.36 compared to the industry median of 10.14.

For the past 12 months through Sept. 13, the share price increased 9% to above the 200-, 100- and 50-day simple moving average lines. The 52-week range is $67.41 to $79.47 per share.

GuruFocus assigned a rating of 3.2 out of 10 for the company's financial strength and a 6 out of 10 rating for its profitability and growth.

Wall Street issued an overweight recommendation rating for shares of Dominion Energy with an average target price of $81.19.

The 14-day relative strength index of 58 suggests the stock is neither oversold nor overbought.

The third company is Takeda Pharmaceutical Co. Ltd. (TKPHF), whose shares closed at $35.2 on Friday with a market capitalization of approximately $55.15 billion.

The stock has a forward dividend yield of 4.68%, which is 318 basis points higher than the industry median of 1.5% and 218 basis points higher than the S&P 500's yield.

The Japanese drug manufacturer has paid semi-annual dividends since June 27, 2013. The company paid 90 Japanese yen (83 cents) per common share on Sept. 13.

The stock also has a price-book ratio of 0.57 versus the industry median of 2.22 and a price-sales ratio of 1.71 versus the industry median of 2.67.

The stock has declined 18% over the past 12 months through Sept. 13. The share price is below the 200-day simple moving average line, but above the 100 and 50-day lines. The 52-week range is $31.22 to $43.51.

GuruFocus assigned a 3.8 out of 10 rating for the company's financial strength and a rating of 5 out of 10 for its profitability.

Wall Street issued a buy recommendation rating for shares of Takeda Pharmaceutical with an average target price of 5,200 yen.

The 14-day relative strength index of 59 suggests the stock is neither overbought nor oversold.

Disclosure: I have no positions in any securities mentioned.

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This article first appeared on GuruFocus.