We’ve had three interesting stock-specific inquiries from members over the last few days, so we are taking a moment to share. First, Doug from Antioch, Illinois notes that tech company Snap has fallen dramatically from its IPO highs just a few days ago, and wonders if now is a good time to buy. Next, Benjamin from France asks for our views on 2019 Alibaba Call Options. And finally, Michael from Lincoln, Nebraska asks about a new wood chip play, Enviva (EVA) which offers a big distribution yield of 7.3%. This article gives our brief views on all three of these opportunities.
This Company's Bonds are Better Than Its Stock
This week’s members-only investment idea is an investment grade corporate bond with an attractive yield (nearly 6%). The stock of this company also offers a high yield (the dividend yield is over 5%), but we believe the risks associated with the stock are too high, and we actually prefer the bonds instead. Specifically, the long-term viability (>10 years) of the company is uncertain which makes the stock very volatile, but we believe the company will still easily generate enough cash flow to support the bonds...
An Increasingly Attractive 17% Yield
The maritime shipping industry has been decimated in recent years, with commodity prices down and multiple companies filing for bankruptcy. However, one of the shippers in particular has been showing dramatically improving financials, and we believe its high-yield bonds are even more attractive than its stock.
Three (3) High-Yield Shipping Opportunities
The shipping industry has been decimated in recent years as measured by the Dow Jones Global Shipping Index (DJGSH) which is still down nearly 50% since mid-2014 (and it now pays an 11.9% yield!). And while there may be some very valuable contrarian opportunities in the space, many shippers are in deep distress and there will likely be more bankruptcies. This article highlights three ways to play the space.
An Attractive Investment Opportunity
Today we’re sharing an attractive investment opportunity for your consideration. It’s the type of investment that generally only works when market volatility is high. However, despite the VIX being at historically low levels, there are still pockets of high volatility in the market where the premium is attractive for selling insurance (puts) on stocks we’d like to own anyway.
A Brief Update on our Mortgage REIT Holding
Ventas: Big Safe Dividend or Dangerous Value Trap?
Ventas (VTR) is a healthcare REIT that pays a big 5.1% dividend yield. But its share price has declined dramatically since last summer (and particularly since the election). And considering the huge demographic healthcare tailwinds at its back, it might seem like now is a great time to “buy low.” This article reviews VTR's future prospects, and provides our strong views on whether it’s an attractive income opportunity or a dangerous value trap.
New Trades: Income Equity Strategy
The purpose of this post is to provide an update on several new trades in the Blue Harbinger Income Equity strategy. Specifically, we have added several new attractive closed-end funds (CEFs) that offer very healthy yields. We also sold one of our biggest yielding individual stocks, and we provide a rationale for the sale.
7.6% Yield CEF, Superior Management, Big Discount to NAV
This particular closed-end fund (CEF) offers an attractive 7.6% yield, an amazing track record of top-notch management, and currently trades at an exceptionally attractive discount to its net asset value (NAV). We are also very comfortable with its holdings, particularly its sector exposures, and believe it’s poised to deliver very strong future returns.
Attractive CEF Pays 7%, Big Discount to NAV
This morning we highlight an attractive “style-specific” Closed-End Fund (CEF) that offers a big 7.7% yield and trades at a compelling discount to its Net Asset Value (NAV). Importantly, this particular “style exposure” is extremely powerful over the long-term (it tends to outperform, by a lot), and it’s missing from many investors portfolios.
This 8% Yield Small Cap CEF Is Attractive
Small cap stocks provide significant long-term price appreciation potential, but a perennial problem for income-investors is they pay very little in terms of dividends. However, the small cap CEF we review in this article offers a very attractive 8.0% annual yield (paid quarterly). It also offers a great management team, an impressive long-term track record, and it currently trades at a compelling 16% discount to its NAV suggesting it has strong price appreciation potential ahead.
This 11% Yield CEF Has Big Upside Potential
If you like big yield and significant price appreciation potential, then this particular closed-end fund (CEF) is worth considering. It’s a sector-specific CEF that yields nearly 11% (paid monthly). And not only is the sector an attractive contrarian play for multiple reasons right now, the fund is trading at a double-digit discount to its NAV which suggests it may have even more upside rebound potential ahead.
High Income: CEF Quick Screen Ideas
If you like to generate steady high income, Closed End Funds (CEFs) may be on your radar. For example, equity CEFs often generate steady quarterly distributions in excess of 7%. If you are a young person saving for retirement, it’s generally a good idea to NOT invest in CEFs, but if you’re already retired (or semi-retired) then CEFs can be worth considering. This article highlights 30 equity CEFs (many trading at attractive discounts), and we also share our views on how CEFs can be valuable if used correctly.
5 Exchange Traded Funds (ETFs) for 2017
The following table shows the performance of 40 sector and industry ETFs sorted by year-to-date total returns. And not surprisingly, given the high political uncertainty this year, health care (and biopharmaceuticals, in particular) have performed very poorly, especially versus the S&P 500 which is up 13% this year. This article details five specific ETFs (across markets, sectors and industries) that we believe are particularly attractive headed into 2017...
A Small Cap Software Company with Big Upside
This week’s members-only investment idea is a small cap Software as a Service (SaaS) company with very significant price appreciation potential. The stock fell after the November election, but for all the wrong reasons. The stock price still hasn’t recovered yet, and we believe it has big upside potential in 2017 and beyond because it offers a better product with little competition and a very big total addressable market. This stock has room to run!
Apple: Will Trump Extend an Olive Branch?
During Wednesday’s “Tech Summit,” President-Elect Trump will likely extend an olive branch to Apple whereby he’ll offer a tax-break so companies (like Apple) can bring large overseas cash balances back to the US. However, of course there will be strings attached (for example, Trump wants iPhones manufactured in the US, despite daunting economics). This article reviews Apple’s current valuation, its healthy dividend, some of the possible results of the Tech Summit, and our views on whether now is a good time to buy Apple or jump ship!
Facebook: On Sale for Christmas?
Facebook shares are down more than 10% since late October while the market is up. Arguably, Facebook is down because of slowing growth fears, the incoming administration’s hostility to West Coast tech companies, and renewed concerns (and lawsuits) over unfriendly shareholder voting rights. However, this one-trick-pony (online advertising) may still have a lot of room to run. So do the negatives justify the lower share price, or is now a great time to “buy low” just in time for Christmas!?
This Country ETF has Room to Rebound & Run!
In sticking with this week’s ETF/Smart-Beta theme, our members-only investment idea is a country-specific ETF. It’s one that’s been beat up politically and in the market, but remains stronger than many investors give it credit for. It’s a diversified, relatively low-cost, way to benefit from a rebound and continued long-term production and growth.
Paylocity: Hyper-Growth in 5 Charts
Paylocity (PCTY) has negative net income, and a forward price-to-earnings ratio (91.4x) that would make most value investors shriek! However, it has also been experiencing “hyper” revenue growth that is hard to ignore. This article reviews Paylocity’s hyper-growth in five charts, and then provides our views on whether this Arlington-Heights-Illinois-based, zero-dividend-paying company, is worth considering...
Johnson & Johnson: Dividend Powerhouse, New ACA Risks
JNJ is an absolute dividend powerhouse having increased its dividend for more than 50 years straight. However, the company faces new and increased uncertainty risk in light of a Republican House, Senate and President-elect that seem determined to repeal the Affordable Care Act (ACA). In addition to its attractive growing dividend payment, significant long-term capital appreciation potential, and reduced risk via its large and diverse revenue base, we believe JNJ could eventually benefit from reduced regulatory burden under a modified ACA, but is now the right time to buy?