Finding stocks paying high and safe dividend yields is getting harder as recession fears cause companies to hoard cash. The overall dividend payment for companies in the S & P 500 fell 2.3% in the second quarter from the prior period, the first decline after seven quarters of record payouts, according to S & P Dow Jones Indices. With that in mind, CNBC Pro sought to find stocks that are paying high dividends that they can afford. And the stocks have a cheap valuation. Here was our criteria using data from FactSet: Dividend yield above 4% Dividend payout ratio less than 50% Increased dividend four of the last five years Debt to capital ratio less than 80% Current forward P/E is cheaper than its average forward P/E of the last five years (Values are as of the end of last week.) Along with several banking shares, drugmaker Pfizer and children’s apparel maker Carter’s made the list. Pfizer pays a 4.6% dividend yield, a hefty income payout in this uncertain second-half environment. And the shares are trading at a 9% discount to their 5-year average forward P/E. (Forward P/E looks at a share price relative to the consensus earnings estimate for the next 12 months.) Carter’s pays a 4% dividend and is trading at a 10% discount.
