SCARED? 6 SAFE COMPANIES BEAT U. S. BONDS

The beat- down in stocks is creating an interesting opportunity — a chance to invest in rock- solid companies that pay out more than U. S. Treasuries.

There are now six stocks in the Standard & Poor’s 500, including health care giant Johnson & Johnson ( JNJ), software maker

Microsoft ( MSFT) and gadget maker Apple ( AAPL) with perfect or near- perfect credit ratings that are paying dividend yields that top those of the 10- year Treasury, according to a USA TODAY analysis of data from S& P Global Market Intelligence. The companies must have a AAA, AA+ or AA rating from Standard & Poor’s Ratings Services in addition to a stable credit outlook — which limits the list to only the most rock- solid.

Stock prices have been pummeled to such a degree and bond yields pushed down so much that investors can pick up the most financial surefooted companies and get dividend yields that surpass the 1.64% yield on the 10year Treasury. These six companies are currently yielding an average of 2.9%.

Johnson & Johnson is perhaps the best example. The health products company is just one of three companies left in the S& P 500 that have the perfect AAA credit rating from S& P Ratings Services and has a stable outlook. Despite that rock- solid rating, the company’s stock is yielding 2.9%. This company has an added bo- nus in that it’s in the relatively stable health care business. The stock is down only 1% this year while the S& P 500 is off more than 10%. J& J is only 3.6% off of its 52- week high, in fact, while the market is down 14%.

Microsoft is another remaining AAA- rated company with a stable outlook, and it’s also yielding 2.9%. The cloud- technology company’s enormous pile of $ 113 billion in cash and investments and relatively low debt give investors confidence in its financial strength.

It’s important to note that while these companies might have rock- solid financials — and pay a Treasury- beating dividend — that doesn’t mean their stocks won’t fall. Apple is the case study in that. The company has a AA+ credit rating, just one notch below the perfect AAA, and is paying a 2.2% dividend yield. That’s a dividend the company can easily afford given its $ 215 billion in cash and investments. But just because a company has a high credit rating doesn’t mean its stock can’t fall. Stalling smart- phone sales have crushed Apple’s stock price by 11% this year and 30% from its high the past 52 weeks. Same goes with Walmart

Stores ( WMT). The retailer’s nearly 3% dividend yield is attractive — but not without stock risk. Shares have lost about a third of their value from the high over the past 52 weeks.

It’s also important to note that dividends aren’t like bond payments — they can be cut or suspended by companies at any time. And there’s no guarantee that the credit ratings won’t deteriorate.

Exxon Mobil ( XOM) is another AAA rated S& P company and yields 3.7%. But S& P put the company on a negative outlook — reminding investors that there’s still risk.

Returns from these stocks are far from guaranteed. And the underlying prices will certainly be riskier than that of Treasuries. But they’re one of the more rocksolid things going as the market gets that much closer to a bear market — and at least investors can take some comfort from that.