After a difficult period involving financial and operational reorganization, this energy company has emerged financially stronger and set to grow its already attractive dividend. This article provides a background on the company, analyzes its recent past, dividend potential and finally concludes with our opinion on who might want to consider investing.
We are sharing an attractive income-generating options trade that exists because of current market conditions. Specifically, after completing a major portfolio restructuring in recent years, healthy-dividend healthcare REIT HCP is now well-positioned for strong income in the years ahead, but has recently sold-off thereby creating an attractive income-generating options trade opportunity. We believe this is an attractive trade to place today, and potentially tomorrow, as long as the share price doesn’t move too dramatically before then.
Investors have been bemoaning the extended rally by growth and momentum stocks for years considering value has been meaningfully underperforming (value stocks are still up a lot, just not as much as growth). However, there’s been a significant market style rotation going on in recent weeks whereby the fastest “revenue growers” have sold-off hard. Pundits have also recently been obsessed with the idea of a coming recession, and view the rotation as the beginning of the end (or as chicken little would say, “the sky is falling.”) This week’s Weekly reviews the rotation, identifies attractively priced opportunities, and shares some common sense wisdom on the current market environment.
Some investors view Energy Transfer, LP (ET) as a stable, cash flow generator. But are is it? And are the fundamentals actually improving? If you don’t know, it’s a Master Limited Partnership (MLP) that operates energy oriented transportation, storage and midstream assets in major production basins in the United States. This article provides a background on the company, analyses its cash flow generation, balance sheet, dividend potential and finally concludes with our opinion on whether investors should take advantage of the company’s high dividend yield.
REITs have been on fire this year, as you can see in the following chart. REITs (XLRE) are up more than 30%, while the S&P 500 is up just over 20%. And popular, 4.6% dividend yield, WP Carey REIT is up an impressive 42% year-to-date. For those of you who wish you’d have bought into WP Carey at a lower price (and for those of you who may want to buy more), there is another way, besides just sitting and waiting for a sell-off so you can “buy low.”
This week’s Weekly doubles as our monthly performance update. We first compare the dueling narratives on interest rates from the Federal Reserve versus the President, and then consider whether your investments where impacted by your decision to believe one story or the other. Next we review the recent performance of our three investment strategies (including every single position). All three strategies continue to deliver market-beating performance and deliver high income for investors. We also share several attractive investment ideas.
Royal Dutch Shell (RDS.B) has a consistent history of paying dividends despite swings in oil and gas prices. The company has successfully used balance sheet and cost containment to sustain dividends during difficult times. This article provides a background on the company, analyzes its cash flow generation, dividend potential and finally concludes with our opinion on whether investors should add exposure to the company.
This is part 2 of our free public article titled Top 10 Big Yields, and this members-only version includes the top 5 big yields worth considering. This report includes REITs, BDCs and CEFs, and we own most of them.
As we recently wrote about in detail here, Stag Industrial (STAG) pays big monthly dividends (5.1% yield) and it has “more octane” than other REITs. The “octane” generally makes Stag shares go up more when the market is strong, healthy and calm, but down more (compared to other REITs) when the market sells off. And the market sold-off hard on Friday, and Stag’s shares were down a large 4.75%, thereby creating this very attractive high-income-generating options trade opportunity.
Trade War tensions escalated Friday. So did market volatility. The S&P 500 fell sharply. This week’s Weekly reviews a few of the biggest movers on our watch last week. Specifically, two stocks we own that were up big (despite the sell-off) and three names (including a couple big-dividend payers) that sold-off thereby creating attractive investment opportunities. We also review our two most recent income-generating options trade ideas—both of which we continue to believe are quite attractive now.
We’ve written about the attractiveness of healthy dividend REIT Simon Property Group (SPG) in the past, most recently here. But we’re highlighting it again now because the valuation and income available are increasingly very attractive. The narrative that the Internet will kill all brick-and-mortar stores is way overblown in Simon’s case, so we are sharing this very attractive options trade opportunity.
Big-dividend mortgage-related REIT, New Residential (NRZ), is down 16% in the last few months while the overall market (SPY) is still up. This article explains why it fell, what will likely happen next, and we conclude with an attractive income-generating options trade that you may want to consider.
This past week was a roller coaster complete with jostling ups and downs, but we finished very close to where we started (the S&P 500 finished the week down 0.4% after being down as much as 3.0%). Did you panic over the volatility and make bad decisions that cost you money? Did you lose sight of your long-term goals? This week’s Weekly reviews some our holdings, as well as pitfalls to avoid and opportunities to keep winning.
If you are looking for a differentiated source of high income, TriplePoint Venture Growth is a BDC that is worth considering. Not only does it provide a differentiated source of high income compared to traditional high income sectors and industries, but it trades significantly lower than peers, and at only approximately par (price-to-NAV just above one) after Monday’s broad marketwide sell-off.
“Trade Wars,” interest rate cuts, an eerily calm VIX, and the longest bull rally in history is leading many investors to believe we’re due for a market wide sell off (perhaps a big one) that could arrive any day now. We are not in the businesses of “fear mongering,” but being prepared for very bumpy roads ahead is just good investing. This week’s Blue Harbinger Weekly discusses two critical things you can do with your investment portfolio to be prepared for the next big market sell off. The first is to simply pick good investments (and we will review a few in this write-up). The second has to do with picking the right kind of investments—which we will explain in more detail.
There’s been plenty of discussion lately about where the Fed should be setting interest rates, especially considering over the last year expectations have changed from anticipating increases to cuts. The economy remains strong by many measures (e.g. strong GDP, low unemployment), yet the Twitter in Chief wants rate cuts to better compete internationally. And whilst this dramatic change in expectations has been occurring, one interesting 7.6% yield (paid monthly) floating rate closed end fund (“CEF”) has fallen very hard—perhaps significantly too hard. Specifically, not only have sinking rate expectations punished its floating interest rate holdings, but the pure selling pressure has caused the shares to trade at a very wide discount to the actual market value of its underlying holdings (it trades at an 11.6% discount to NAV). If you are an income-focused contrarian investor that likes to buy things at widely discounted prices—this one is worth considering.
The following chart shows expectations for interest rates set by the fed have changed dramatically over the last year from expected increases to expected decreases. And the big question to many investors is Why? With an economy that appears quite healthy (healthy GDP growth, low unemployment, inflation in check), why wouldn’t the fed be raising interest rates to a more normal level? Afterall, they’ve been abnormally low by most standards since the financial crisis. Is the fed bowing to the Twitter in Chief or are they simply punishing savers? There are plenty of retirees that long for the +15% yield on treasuries that existed in the early 1980s.
If you like to generate stable income from your investments, this energy focused CEF has a minimum annual distribution commitment of 6% and is currently trading at a discount of 16.7% to its NAV. The fund is one of the oldest CEFs and has a successful track record of paying over 80 years of distributions. The fund has been a consistent performer and what is even more encouraging is that it operates with no interest-bearing debt! If you’re looking for a powerful income-producing investment, with a long successful track record based on an indispensable element of economic growth, and trading at an attractively discounted price—this one is worth considering.
The market (SPY) has been on fire this year (+21.4%), however plenty of very attractive long-term investment opportunities remain. This week’s Weekly shares the performance of each of our holdings across all three of our strategies, and then provides concise commentary on attractive opportunities among REITs, healthcare, growth stocks and our high-income low-beta “Alternative Fixed Income” strategy. We conclude with a little advice.
The S&P 500 is now up over 20% this year, which is a big number. But to keep that in perspective, it’s up only 11.4% over the last year, and it’s averaging 10.7% over the last 5 years. Keep those more moderate numbers in mind the next time someone tries to frighten you into ditching your long-term strategy and selling everything because “the sky is falling.” This week’s Weekly reviews the performance of every position we own over recent time periods, and highlights a few ideas that are particularly attractive right now.