If you are looking for a big healthy blue-chip dividend yield with significant price appreciation potential, this global chemicals company is worth considering. Specifically, it is set to generate significant amounts of cash flow over the next two years, it trades at nearly 11% 2020 Free Cash Flow yield, it offers a healthy 5.1% dividend, and it trades at a significant discount to its peers. In this report, we analyze the company’s business mix, cash flow and income prospects, and finally conclude with our opinion on whether the stock offers an attractive balance between risks and rewards.
REITs Very Bad Week
Real Estate Investment Trusts (REITs) just had a very bad week. Many popular REITs (such as HCP, DLR, WELL and VTR) were down more than 7%, while the S&P 500 was up almost 1%. And importantly, there are a few real time learning opportunities here. Chicken little thinks the sky is falling, arm-chair quarterbacks are blaming the Fed, contrarians says this was long overdue, and asset allocators are whining that these are just tremors before the “big one” whereby the market’s tectonic plates are about to shift. So what do you do?
Union Pacific: Despite New Risks, Attractive Cash Flows, Dividends, Price Appreciation Potential
Despite a variety of headwinds (such as a declining coal business, a challenged auto industry, tariffs, unexpected competition from trucking, rising debt levels and network congestion), Union Pacific (UNP) continues to generate healthy cash flows, whereby the excess is prudently returned to shareholders via growing dividends and share repurchases. Plus, based on growth expectations, the shares have steady and continuing upside potential. This article reviews the business, risks, strategic initiatives, cash flows and valuation, and then concludes with our opinion about investing.
New Options Trade: P&G Shares Expensive, Yield Is Ugly Low
The market has been strong this year, but dividend yields on popular blue-chip stalwarts have been in decline (as price rises, yields mathematically fall). P&G's has clearly improved (and is now firing on all cylinders), but its valuation and dividend yield are not appealing relative to the sector and its own trading history. This report shares an attractive, Procter & Gamble, income-generating options trade.
More Gains Ahead: Reasonable Index Levels, Attractive Stock-Specific Opportunities
It may feel like the market is rising to extreme levels, but index valuations are reasonable, and highly attractive stock-specific opportunities persist. This is our monthly performance update whereby part 1 shares our overview of current market conditions, and part 2 reviews the continuing powerful long-term gains of our three investment strategies (they were all up again over the last month), as well as a performance review of every individual holding (we currently have 65 individual positions across three separate portfolios), and more details on some specific highly-attractive high-income opportunities.
New Options Trade (Income-Generating): EastGroup Properties Has Been On Fire
EastGroup Properties (EGP) is an industrial REIT, and it has posted incredible performance in recent years (its price is up 138% since the start of 2016, and that is excluding its big dividend payments). And considering its performance, the options market is currently offering attractive premium income on the shares thanks to some perhaps over-confident “herd-following” investors. We currently own shares of EGP (we have since 2016), and this report explains why we like a specific income-generating EGP options trade.
Top 5 Big Dividends: 6% to +9% Yields (Contrarian Value Edition)
This is a continuation of our free report titled “Top 10 Big Dividends (Contrarian Value Edition),” except this members-only version contains all the details of our Top 5. The yields on the top 5 range from 6% to over 9%, and we currently own all 5 of them. And as a reminder, despite the strong performance for the S&P 500 so far this year, if you are an income-focused value investor, there are still plenty of attractive big-dividend contrarian opportunities available in the market right now (i.e big dividends with attractive price appreciation potential). Without further ado, here is the full list.
This 13.6% Monthly Dividend Is Worth Considering
This global oil and gas producer, trades at an attractively discounted price, and pays big healthy monthly dividends. It offers a unique combination of production growth as well as below average financial leverage. The company has a history of self-funding capital programs as well as net dividends despite oil and gas price volatility as a result of attractive economics of its assets coupled with proactive hedging activities to reduce volatility.
Blue Harbinger Weekly: Dogs of the Dow
The Dogs of the Dow strategy is a contrarian, dividend-focused approach to blue chip investing, whereby an investor purchases annually the 10 Dow Jones stocks with the highest dividend yield. The idea is that management teams set the dividend at an appropriate level, and a higher yield is a signal that the shares are undervalued. This week’s Blue Harbinger Weekly reviews the recent performance of the individual Dogs of the Dow, as well as two specific Dogs that are particularly attractive right now. We also share the weekly performance update table for all of our current holdings (and contenders) along with a few comments on performance and opportunities.
New Options Trade: Johnson & Johnson Asbestos Fear, High Income Opportunity
Jonson & Johnson is a healthy blue chip dividend aristocrat. The shares have already inappropriately been beat up this year. And they just sold off another 6.2% on Friday thanks to overblown fear related to an irrelevant trace of asbestos found in a lot of its baby powder. These fear-driven factors have combined to create an attractive income-generating options trade opportunity, as described in this report.
Rare Counter-Cyclical Income-Oriented Company, 11.6% Yield
This real estate investment trust (“REIT”) invests in securities that are tied to the residential and commercial real estate market, in order to generate stable income. In this article, we analyze the company’s business model, growth and income prospects, balance sheet, risks, and finally conclude with our opinion on whether (and how) income-investors might want to consider investing in this stock.
Pfizer's 4.2% Dividend Yield: Undervalued Blue Chip, Or Dangerous Value Trap?
Pfizer (PFE) has a reputation for being a blue-chip pharmaceuticals company. However, its recent performance has been weak as the overall healthcare sector (and drug companies, in particular) have under-performed the market (President Trump has taken over the fight to reduce drug costs for investors). And Pfizer in particular has been undergoing some significantly risky portfolio restructuring. As a result, Pfizer’s dividend yield (4.2%) is now significantly higher than normal (as the price has fallen), especially for a Dow Jones stock. This article considers whether Pfizer is currently an attractive big-dividend blue chip, or a dangerous value trap.
Deeply Undervalued, Income Generating (5.8% Yield), Blue Chip Opportunity
This biopharmaceutical company is engaged in research, development and marketing of biotech drugs. In this article, we analyze its business mix, growth and income prospects, balance sheet, risks and finally conclude with our opinion on whether the company’s stock offers an attractive balance between risks and rewards.
New Options Trade: ABB Ltd, High Income Opportunity on a Big-Dividend Payer
ABB Ltd is an attractive, big-dividend (4.3% yield), industrial automation company that operates out of Switzerland and trades on the New York Stock Exchange. And the options market is currently offering some very attractive premium income on the shares thanks to an unsurprising dose of shortsighted market participants. This report explains why we like the company and why we like the trade. More specifically, we believe this is an attractive trade to place today, and potentially Tuesday and/or Wednesday, as long as the share price doesn’t move too dramatically before then.
You’re Too Old to Make This Mistake (Monthly Performance Update)
If you’d have been invested in 100% “aggressive growth” stocks over the last two months (for example, young software companies with very high sales growth), you’d have gotten absolutely slaughtered. A bloodbath. Whether you call it a “rotation” or a long overdue “correction,” is irrelevant. The mistake we are talking about is, of course, the failure to prudently diversify your portfolio. We’re not suggesting anyone be a “closet index fund,” but for goodness sake, don’t put all your eggs in one basket. In fact, don’t even put most of them in one basket. You’re too darned old for that crap. And if you don’t know what we’re talking about, for your reference, check out these 7 Deadly Sins of Long-Term Investing (too many eggs in one basket is on the list).
Top 7 Preferred Stocks: 7% Yields, and Up (Members-Only)
In this members-only report, we provide all the details for our top 7 big-dividend preferred stocks. And as mentioned previously, if you like to earn high income on your investments, and you are frustrated with artificially low interest rates (thanks to the Fed’s meddling), you might consider preferred stocks. They offer compelling high yields, and less volatility risk than many other high yield opportunities. This week’s Blue Harbinger Weekly shares our top high yield preferred stocks (we currently own 6 of the top 7). Without further ado, here is the full (members-only) report.
This 9.1% Yield Preferred Stock Is Attractive and Worth Considering
This attractive company is nearing the end of a very large strategic capital expenditure program, and on a trajectory for very strong EBITDA growth. And its preferred stock offers strong stable income thanks to the company’s structure. This article provides an overview of the company and then considers the potential returns, growth prospects, developments and risks. Overall, if you are an income-focused investor, this one is absolutely worth considering for a spot in your prudently diversified long-term portfolio.
Options Trade: Energy Transfer, Attractive Premium Income
Energy Transfer is an attractive, big-distribution midstream energy company, and the price is significantly too low (in our view) because it has been incorrectly lumped in with other energy stocks whose near and intermediate term prices are more dependent on energy prices (ET has stable long-term contracts based on volume, not energy prices). Further, the recent volatility has created an attractive high-income-generating opportunity in the options market. This write-up shares the specific details on this attractive income-generating trade.
Blue Harbinger Weekly: Attractive Opportunities as Value Stocks Heat Up
A dramatic shift is taking place in the market as value stocks continue to heat up, and it’s creating some attractive opportunities, so long as you stay disciplined and focused on your goals. This week’s Weekly shares some specific attractive opportunities, as well as our advice on how to win in this market
Teekay Offshore Preferred Shares: 13% Yield, Big Capital Structure Risks, Here’s What You Need to Know
Teekay Offshore Partners, LP is a leading provider of storage, production and transportation assets to the off-shore oil & gas industry. It’s preferred shares (TOO.B) offer an appealing dividend yield and stable cash flows, however uncertainties around future capital structure are worth considering. In this article, we analyze its business model, balance sheet, dividend potential as well as key risks and finally conclude with our opinion on whether the company’s preferreds offer an attractive balance between risks and rewards.