The ETF has a spread out mix of 101 holdings, and the top stock components include Lorillard 3.6%, Lockheed Martin 2.8%, Chevron 2.2%, Entergy 2.0% and Kimberly Clark 2.0%.
Looking at the top holdings, Jeff Stouffer for The Motley Fool points out that Lorillard has implemented a $500 million share-repurchase program.Lockheed has been known for its historical dividend rates paid, but the recent sequestration cuts on defense spending could put a dent on income. Chevron has experienced robust dividend growth rates over the past five years.
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Max Chen contributed to this article.
Full disclosure: Tom Lydon’s clients own DVY.