Income investors, focused primarily on generating big steady income, can still enjoy some price appreciation too. And now that interest rate volatility is decreasing, attractive high-income opportunities are increasingly emerging. In this report, we first share and discuss comparative data on over 100 big-yield closed-end funds (“CEFs”) and over 40 big-yield business development companies (“BDCs”), and then rank our top 10 favorites (with yields ranging from 6.0% to over 12.0%), starting with #10 and counting down to our very top ideas.
Wide Moat Semiconductor Company: Two Massive Secular Trends
The non-mega-cap semiconductor company we review in this report is growing rapidly as it benefits from two massive secular trends: (1) the cloud (and artificial intelligence), and (2) dramatically increasing technology in the automotive industry (i.e. its chips have increasing applications in new cars). Also, this wide-moat founder-led company has impressive profit margins (important in the current macro environment), and generates tons of cash (for increasing dividends and share repurchases). If you are looking for an attractive “offense-and-defense” investment opportunity, these shares are worth considering.
50 Top Growth Stocks: These 3 Worth Considering
Market fear has ticked up slightly over the last week as interest rate hikes are expected to resume and this could pour water on the red hot stock market rally so far this year, especially high-growth stocks. However, it’s our contention that this short-term noise won’t matter for select top growth stocks which will be driven higher by strong execution supported by incredible disruptive secular trends (including generative AI, the great cloud migration and the world’s insatiable desire for more efficient sources of energy). In this report, we share high-level data on the current state of the market, company-specific fundamental metrics on over 50 top growth stocks, and then review three specific stocks from the list that represent particular compelling businesses going forward.
Big-Yield BDC: Why This 11.2% Yielder May Be Set For Gains Ahead
Business Development Companies (BDCs) are another income-investor favorite thanks to their very large dividends and potential for price gains. In this report, we review an attractive BDC that has positioned itself for solid performance ahead (i.e. potential dividend and price increases). We review the business, the market, the dividend safety, valuation and risks, and then conclude with our opinion on investing.
NMZ: 50 Big-Yield Municipal Bond CEFs, Historically Large Price Discounts
Big Yield Bond CEFs: Is It Safe To Invest? (Interest Rate Risk)
Income-focused investors love big-yield bond CEFs because of their large distributions payments, often paid monthly. But if you’ve been following along, you know most of them (i.e. the popular PIMCO and BlackRock bond CEFs) have been feeling a lot of pain over the last year (because as rates have gone up, bond prices have gone down). Granted some investors don’t care about price as long as the income keeps rolling in, but it really does matter. In this report, we provide an update on three popular Bond CEFs (two from PIMCO and one from BlackRock), and share our views on whether the interest rate environment is signaling an “all clear” sign. We conclude with our strong opinion on investing.
Lithium Producer: 40 Top Stocks, These 4 Worth Considering
There are many ways to identify top investment opportunities, and one strategy is to screen the universe based on important fundamental metrics and then dig deeper into the names that look attractive. In this report, we share data on 40+ high-profit-margin and high-sales-growth stocks, and then dig deeper into four that are particularly attractive. We have a special focus on a new lithium producer, including a review of its business, its growth potential, its valuation and risks. We conclude with our strong opinion about investing in high-profit-margin and high-sales-growth stocks in the current challenging macroeconomic environment.
This AI-ML Stock: Massive Sticky Secular Growth
The company we review in this report is already benefiting from the massive secular growth in Artificial Intelligence (“AI”) and Machine Learning (“ML”). And it is positioned to keep benefiting massively in the years ahead thanks to its leading solutions, innovation, sticky customer base and very strong balance sheet. This one was loved (during the pandemic bubble) then hated (when the bubble burst), but the business has only been getting stronger and the shares are still inexpensive relative to where we expect them to be in five years and beyond. In this report, we review the business, the growth, the opportunity, the valuation and the risks. We are currently long these shares with no intention of selling.
Is Verizon 7.2% Dividend Yield Worth the Cost?
Verizon’s 7.2% dividend yield is increasingly tempting to many income-focused investors. However, many of those same investors are reminded of AT&T—another telecom that was recently forced to cut its big dividend as the payout got way ahead of the company’s cash flows. In this report, we review Verizon’s business, dividend safety, valuation and risks (including the new Amazon Prime threat), and then conclude with our opinion on investing.
Top Dividend Dogs of the Dow: This Healthcare Stock is Attractive
“Dogs of the Dow” is an investment strategy that essentially involves investing in the 10 Dow Jones stocks with the highest dividend yields. In this report, we review the strategy and then dive into one name from the list that is particularly attractive. Specifically, we review a healthcare sector Dog of the Dow with a compelling 3.8% dividend yield and a low stock price as compared to its value. We conclude with our opinion on investing.
USA: Top 20 Big-Yield CEFs, Discount-Premium Edition
The Liberty All-Star Equity Fund (USA) is a popular big-yield closed-end fund (“CEF”). It offers an annual distribution yield equal to 10% of its net asset value (“NAV”) with 2.5% paid quarterly. And it currently trades at a discount to its NAV (it previously traded at a large premium). In this report, we review USA in detail, and then compare it to 20 other popular big-yield CEFs from varying categories (including some important guidelines on when it might be okay to purchase a CEF at a premium to NAV and when it might not be). We conclude with our strong opinion about investing in USA and a few other CEFs in particular, especially considering their current price premium-versus-discount dynamics.
DNP Select Income Fund: 7.6% Yield, 23.2% Premium to NAV
The DNP Select Income Fund (DNP) is an income investor favorite, offering a steady monthly distribution (current yield: 7.6%) by investing in utility sector stocks and investment grade bonds (both known for safety and stability). However, the shares currently trade at a large 23.2% premium to the fund’s net asset value (“NAV”). In this report, we review the strategy, the leverage, the distribution, the distribution reinvestment plan and the performance. We conclude with our opinion on whether this fund is worth considering for investment, or not.
Nvidia +17,347%: 40 New Top Growth Stocks Worth Considering
I wrote a positive report about Nvidia (NVDA) in 2009 (see image below), and since then the shares are up over 17,347%. I believe Nvidia shares can still go dramatically higher from here (driven by momentum and investor exuberance about artificial intelligence, in particular), but based on valuation, there are other (newer and smaller) high-growth stocks that are also worth considering (such as the 40 included in the detailed data table in this report). After reviewing Nvidia’s business and current valuation, we highlight a couple names from the list that are also particularly attractive, and then conclude with our strong opinion on investing.
Top 10 Growth Stocks: Forget Mega Caps
It takes a special mindset (and a certain financial fortitude) to be a long-term growth investor. But if you can persevere through years of lumpy financial results, whipsawing volatility and the constant drumbeat of naysayers, you could end up getting in early on the next mega-cap growth stock (and enjoying all the powerful long-term gains that go along with it). In this report, we rank our top 10 “non-mega-cap” growth stocks, starting with #10 and counting down to our top ideas.
Top 20 Dividend Stocks, Ranked: Big Yields, Big Opportunities
In this report, we rank our top 20 dividend stocks. The rankings include a split between opportunities with very big yields (yields of 7.0% and up) and very attractive total returns (i.e. solid dividend payments plus significant price appreciation potential). We also highlight 7 dividend market themes that are critically important in the current environment (including: (1) BDCs > Banks, (2) Midstream Stocks > MLPs, (3) A Bird in Hand > Two in the Bush, (4) Falling Rates > Rising Rates, (5) Bond CEFs > Bonds, (6) Contrarian Income > Herd Income, and (7) Value vs Growth). Without further ado, let’s get into the themes and the rankings (starting with #20 and counting down to our top ideas).
SoFi: Supreme Court Decision, Student Loan Repercussions
SoFi recently sued the Biden Administration, arguing there is no legal authority to continue student loan forbearance. However, within the next few weeks, the Supreme Court is widely expected to rule against the Biden Administration’s student loan forgiveness program, which will likely end forbearance within 60 days. In this report, we review SoFi’s business and the effects of fear (from the student loan situation, combined with recent banking sector distress caused by rapidly rising interest rates) on the company’s current valuation. After discussing specific risks in more detail, we conclude with our strong opinion on investing in SoFi.
Attractive Long-Term Solar Play, Ample Room for Growth
The company we review in this report is a leading manufacturer of semiconductor-based microinverters, as well as batteries, EV chargers, and other storage solutions. The company is well positioned given the strong investment activity in the clean energy space globally as well as its innovative microinverter technology. The company is actively diversifying its product offerings and expanding into new markets, while also focusing on continuous technological advancements to maintain a strong presence in the industry. In this report, we analyze the company’s business model, its market opportunity, financials, valuations, risks, and finally, conclude with our opinion on whether an investment in the shares offers an attractive balance between risks and rewards.
Infrastructure CEF: 8.2% Yield, Discounted Price
The closed-end fund (“CEF”) we review in this report is compelling for a variety of reasons, including its big monthly distributions, discounted price and attractive investment strategy (it invests in infrastructure securities, both stocks and bonds). In this report, we review the important details and risks that investors should consider, and then conclude with our strong opinion on investing.
This Lithium Battery Stock: Massive Growth Potential for Patient Investors
In this report, we review a manufacturer of advanced lithium-ion batteries. This early-stage public company is well-positioned to benefit from growing demand, including mobile, Internet of Things (IoT) and electric vehicles. Key differentiators include its energy density advantage (achieved through design and architecture choices) and silicon anode technology. It also addresses key safety concerns. We analyze the business model, market opportunity, financials, valuation and risks. We conclude with our opinion on investing.
Top 10 Dividend Stocks (Income Equity Portfolio) May Update
If you like disciplined long-term total returns and compound growth (i.e. making money) through a combination of healthy dividend growth and long-term share price appreciation—this list may be for you. These aren’t the biggest yielding stocks, and they’re not the most rapidly growing business. But these are healthy, growing, blue chip companies, that can help a lot of people sleep well at night through a combination of impressive dividend growth and powerful share price appreciation potential (i.e. they’re trading at attractively discounted prices relative to their long-term value).