Looking for cash flow? Your best bet might be high-dividend stocks, which offer much better value right now than fixed-income alternatives.
Consider this: The yield on 10-year Treasuries (3.28%) may be higher than the average dividend-paying stock in the S&P 500 (2.4%), but it comes without the upside of price appreciation or future payout increases. The key to identifying a safe dividend investment is to target companies with abundant free cash flow and low debt ratios. Happily, those qualities are pretty common these days, says Anne Lester, manager of J.P. Morgan's $674 million Income Builder Fund. We surveyed Lester and other top dividend-focused fund managers and identified four stocks with above-average yields, strong balance sheets, and good growth prospects.
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Last updated December 20 2010: 2:55 PM ET
All stock prices as of Nov. 30