Shares That Start Strong

S&P identifies 18 top-ranked, dividend-paying stocks that have fared better than most in every first quarter of the last five years

By Numer de Guia, CFA

This week, we're going to try something a little different and take a long-term view of a short-term phenomenon. To wit: Which stocks have done the best in the first quarter of the calendar year -- in each year of a multiyear period? While there are no guarantees, identifying attractive stocks that have shown seasonal strength -- even in down years -- can be useful in deciding which shares to buy as 2005 gets underway.

We started by looking for those companies that have posted a positive total return -- capital appreciation plus dividends -- in the first quarter of every calendar year since 2000. To add to their appeal, each stock on the list has to pay a quarterly dividend.

Furthermore, those names have to jump through one final hoop. To make sure they show good potential for gains beyond the first quarter, each has to carry an S&P investment ranking of 4 STARS (buy) or 5 STARS (strong buy). S&P equity analysts expect stocks with those designations to outperform the overall market in the next 6 to 12 months.

Eighteen names made the cut. The average current dividend yield of these stocks is 3.69%, and the range is 0.18% to 8.9%. Note also the heavy presence of real estate investment trusts on the list.

  Dividend-Paying First Quarter Winners
Company Ticker S&P STARS Rank
American Capital Strategies ACAS 4
Glimcher Realty Trust GRT 4
Istar Financial SFI 4
Sovran Self Storage SSS 4
Developers Diversified Realty DDR 4
CBL & Associates CBL 5
Macerich Co. MAC 4
Acadia Realty Trust AKR 4
Simon Property Group SPG 5
Taubman Centers TCO 4
Pan Pacific Retail Properties PNP 4
Bank of Hawaii BOH 4
McCormick & Co. MKC 4
BJ Services BJS 4
Liz Claiborne LIZ 4
Finish Line FINL 4
Stryker Corp. SYK 4

De Guia is an analyst for Standard & Poor's Portfolio Advisors

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