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8 Foreign Stocks Paying Big Dividends

Courtesy Suncor

For many well-known U.S. dividend stocks, the price of popularity these days is disappointingly low yields. So we went looking abroad for some better yields — and potentially better bargains, given that most foreign stock markets have badly lagged Wall Street in recent years. With the help of research firm Morningstar, we picked eight companies, all with U.S.-traded shares, that are worth a look by domestic dividend-focused investors.

There are some big caveats. One is that investing abroad exposes you to currency risk. If the dollar strengthens against foreign currencies, as it did from mid-2011 through 2015, foreign-stock dividend payouts will be smaller than they appear because dividends paid in weakening foreign currencies translate into fewer dollars. Likewise, a strengthening dollar can lead to a devaluation of the shares themselves. On the flip side, if the dollar weakens, the effect can be to enhance the value of U.S.-traded foreign stocks as well as the dividends they pay U.S. investors.

Keep in mind, too, that accounting policies in many countries differ from those in the U.S. Among other things, companies in some foreign countries need to report their financial results only twice a year, rather than quarterly, as is required in the U.S. If you invest in a foreign stock, you also may end up owing both foreign and U.S. taxes on your dividends. Consult with your tax adviser before you buy a foreign dividend payer.

Picks are listed alphabetically. Share prices and related figures are as of June 22. Unless otherwise indicated, price-earnings ratios are based on estimated earnings for the next 12 months. In instances in which a company pays its dividends in unequal installments, yields are based on dividends paid over the previous 12 months.

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