Where to Place Your Call for Dividends With Telecom Stocks

With the Federal Reserve continuing to clamp down on interest rates, scavenging investors are starved for yield. Telecommunications companies, with their ripe dividends, are one likely place to look for sustenance.

One question for the really ravenous investor, though, is weather AT&T or Verizon will do a better job increasing its dividend in coming years? AT&T has steadily raised its dividend for 28 years and supplements this capital return with stock buybacks. But when it comes to the possibility of accelerated dividend increases, Verizon looks better-positioned than its rival. A larger-than-normal dividend rise isn't likely to come this year. But analysts at Macquarie say Verizon shareholders could see a one-time, 10% increase in the dividend in 2013 or 2014. AT&T is more likely to continue with its regular but more-sedate pace of dividend increases.