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).
Top 10 “High Income NOW” Opportunities: May Update
As fear of more bank defaults climbed over the last month, so has the yield in our High Income NOW portfolio, currently sitting at 10.2%. There was a “flight to quality” in dividend blue chips, while short-term treasury yields climbed (the 6-month currently yields over 5%), keeping the yield curve very inverted (a sign of looming recession) while the Fed may have just completed its final rate hike of 2023. In this report, we countdown our new top 10 “High Income NOW” opportunities (the rankings have changed) as we position the strategy for more big income payments ahead.
Attractive 11.7% Yield Monthly-Pay Bond CEF
If you are seeking big steady income, from a top-shelf manager, that currently trades at a discount to NAV, and may be set for dramatic price appreciation heading into the end of 2023 (as fed rate hikes peak and then are expected to reverse), the 11.7% annual yield (monthly pay) closed-end fund (“CEF”) we review in this report is worth considering.
5 Contrarian Dividend Stocks Set to Climb
The market has been climbing a wall of worry this year and the economy is teetering on an ugly recession. The fact that the yield curve is steeply inverted (see chart below) has contributed to recent bank failures (Silicon Valley and First Republic), and more things in the economy are going to break. That said, the stock market tends to recover well before the recession is over. In this report, we share five attractive dividend stocks that are particularly compelling from a contrarian standpoint considering the share prices are down, the dividends remain strong, and we expect both (share prices and dividends) to get even significantly better over time.
US Bancorp: 5.6% Yield, 3 Big Risks (Short Seller Edition)
So far this year, US Bancorp (USB) is one of the worst performing stocks in the S&P 500 (it’s down over 20%), and it now offers one of the highest dividend yields (5.6%). And a lot of income-focused contrarian investors are increasingly tempted, especially considering the bank has raised its big dividend for the last twelve consecutive years in a row. After reviewing US Bancorp and its current valuation, we consider three big risks to investors (with a regulatory-induced dividend cut perhaps the biggest, as described by a recent HoldCo short-seller report), and then conclude with our strong opinion on investing.
100 Tempting Big Yields: These 4 Worth Considering
If you are an income-focused investor, there are many big-yield strategies to choose from. However, not all of them may be right for you. In this report, we share updated data on a wide variety of big-yield opportunities, including over 100 big-yield REITs, CEFs, BDCs and more. Then we highlight four names from the list that are particularly interesting and worth considering. Specifically, we highlight three tempting big-yield opportunities that we are currently avoiding, followed by one very attractive big-yielder that we currently own.
Ares Commercial Real Estate: It Can Still Get Much Worse for this 16.1% Yield
Members Mailbag: We received an inquiry from a member this week about ACRE (expected to announce earnings on Tues May 2nd). We believe that some investors view this particular mortgage REIT (ACRE) as an attractive contrarian opportunity, considering the shares are down big (-40% over the last year), the yield has mathematically grown to a tempting 16.1%, and it has a well known brand name attached to it (Ares). However, the commercial real estate market is terrible. We share comparative data points on over 100 big-dividend REITs (sorted by sub-industry), dig into some important details on ACRE, and then conclude with our opinion on investing.
US Bancorp: 5.7% Yield, Shares Down Big
Among S&P 100 stocks (see table below), US Bancorp (USB) has one of the biggest dividend yields, but some of the worst year-to-date performance. Like most banks, USB shares sold off hard when the recent Silicon Valley Bank failure was announced, but unlike most banks—shares of USB have NOT subsequently rebounded. In this quick note, we review USB’s recent earnings announcement and the recent USB short-seller report (from HoldCo Asset Management). We conclude with our opinion on whether it’s time to buy US Bank or if it’s time to sell.
Owl Rock: 40 Big-Yield BDCs, Compared
With BDC earnings season set to kick off this week (starting with Ares Capital on Tuesday pre-market), we’ll also be watching Owl Rock closely (set to announce two weeks later). One key metric to watch will be book value as the economy heads towards recession and write-downs could start to more significantly detract from the benefits of rising interest rates. This quick note shares data on 40 big-yield BDC, and digs into Owl Rock in more detail.
100 Hated Stocks: These 4 Worth Considering
If you like to purchase top businesses when their stocks are out of favor with the market, you may find this report interesting. We share data on 100 hated stocks divided into four very different groups: (1) Top Growth Stocks, Down Big; (2) Dividend Growth Stocks, On Sale; (3) Pandemic-Era IPOs, Now; (4) Big Yield CEFs, Discounted Prices. We then select (and review) one particularly attractive opportunity from each of the four groups. We conclude with a critically important takeaway for investors to keep in mind.
April Portfolio Updates: New Trades, Rebalancing
We’ve updated the holdings and “buy under” prices for all three of our top idea portfolios for April, and all the details can be accessed using the links below. We do NOT trade often (we’re long-term investors), but we do have a small handful of trades to update you on. We believe the changes position the portfolios for more long-term success.
Members Mailbag: Small & Micro Cap CEFs (RVT, RMT)
Hated 5.9% Yield Dividend-Growth Stock, Attractive
The stock we review in this report is hated. And it is hated for multiple reasons. However, the market is misinterpreting some of the data, and the fear is overdone. After reviewing the details of this impressive dividend aristocrat (including its business, dividend safety, valuation and risks) we conclude with our strong opinion on investing (hint: we currently own shares in our Income Equity portfolio).
Top 20 S&P 500 Stocks: YTD and Last 10 Years
Lithium: Limited Supply, Increasing Demand
As lithium demand grows (and supply remains limited), the basic materials stock we review in this report is attractive. The shares are down 35% from their 52-week high, but the business continues to strengthen (i.e. revenues are growing very rapidly, the market opportunity is huge and profit margins remain strong). In this quick note report, we consider the company’s latest strategic effort, its valuation and our opinion on investing (i.e. we own shares).
Bond CEFs: Prices, Premiums and Interest Rates
A quick note to share some updated data and commentary on a handful of popular big-yield bond CEFs from PIMCO and BlackRock. This note may be of particular interest to those following our High Income NOW portfolio. For starters, here is a look at the latest movement in premiums and discounts (versus NAV).
Two (2) New Buys: 1 Income Equity, 1 (More) Disciplined Growth
We do NOT buy or sell often, but this is just a quick update to let readers know we have made two more new purchases (the second and third new buys this week). One in our Income Equity Portfolio and now a second buy this week in our Disciplined Growth Portfolio. We’ll be completing our monthly portfolio tracker sheet updates shortly after April begins, but wanted to let readers know right away of these two additional new purchases.
New Buy: Top Growth Stock: Solar Energy Disruption
The industrial sector business we review in this report continues to grow rapidly as it benefits from the solar energy secular trend. Specifically, it provides electrical balance of system solutions (for solar, battery energy and EV charging applications) to mainly engineering and construction firms. And its valuation is increasingly attractive, especially considering the competitive advantages of this highly profitable $3B+ market cap company. We review all the details, and then conclude with our opinion on investing in this rapidly growing business.
Cell Tower REIT: Growing Dividend, Paying Down Debt
The specialty REIT we review in this report focuses mainly on cell towers. The dividend is well covered and has a steady history of increases. Further, the company is virtually guaranteed revenue growth from rent escalators, not to mention the growing secular trends of mobile data usage and the Internet of Things. Further still, the company is working to improve its balance sheet. We review all the details, and then conclude with our opinion on who might want to consider investing.
100 High-Growth Stocks: Contrarian Interest Rising
It’s no secret growth got slaughtered (as the pandemic bubble burst), and TONS of Fed balance sheet unwinding remains (see chart), but rate hikes are slowing (ending?), and valuation multiples much lower on high growth stocks. Here is data on 100 top growth stocks with at least 20% revenue growth (this year and next).