This 6%-Yielding Portfolio Is Cheap. But Is It a Value?

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This 6%-Yielding Portfolio Is Cheap. But Is It a Value?

Let’s talk about the cheapest dividend payers in the world. With respect to cold hard cash flow.

We contrarians are too savvy for P/E ratios. We know that earnings are accounting creations. “Profits” are all fugayzi.

Free cash flow (FCF), on the other hand, is what it is. The cash a company brings in, minus capital expenditures. This cash can be reinvested in the business or, better yet, paid out to income investors like us.

We like companies that dish dividends because their businesses are running on relative autopilot. They needn’t plow every dollar they raise back in. Which is great—more yield for us.… Read more

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These Dividends Grew 50% to 100% Last Year. How About 2023?

Do you also believe that a recession is on the way?

Note that we’re not saying when. Maybe later 2023. Or 2024. For sure 2025.

We are good economists. Casting out predictions without set timelines!

At some point, of course, all of the rate hikes add up. The housing market slows because mortgages become more expensive. Commercial landlords feel the pinch because, well, nobody rents office space anymore!

One by one, industries slow down. Eventually, the much-anticipated recession arrives.

As contrarian investors, we don’t actually care about economic data. GDP. CPI. PPI. PMI.

Whatever. It’s all TMI.

We’re after dividends and growth, in this order.… Read more

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These 2 “Recurring Revenue” Stocks Boast 5.5% Yields, 793% Payout Growth

Today we’re going to discuss the secret to double-digit annual returns every year, forever, with secure real estate investment trusts (REITs).

We income-seekers love REITs for a simple reason: high dividends! The typical REIT yields twice as much as the average S&P 500 stock. That’s mainly because these trusts receive reliable recurring revenue—they simply collect the checks that roll in every month, take out enough to maintain the buildings and then send the rest to us.

And some REIT dividends are true standouts in today’s low-yield world, like the 5.5% thrown off by warehouse landlord W.P. Carey (WPC).

WPC is a two-time winner in our Contrarian Income Report service’s portfolio, having returned a tidy 28% in dividends and gains in 12 months in its first tour and a steady 16% return in 14 months (and counting) in its second.… Read more

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4 Once-in-a-Decade Dividends? They Pay 9.9% to 15.9%

Bear markets can be painful, but they also create “once-in-a-decade” buying opportunities for dividend investors. For example, there are four big names yielding between 9.9% and 15.9% that are literally the leaders in their respective industries. (We’ll review them shortly.)

Bull markets simply don’t boast yields anywhere this high. And double-digit yields can drastically change a retirement game plan.

I’ve complained for years that, if you had a million bucks to plunk down on blue chips and bonds, you’d only be able to wring out about $20,000 to $30,000 in dividends and interest each year. But right now, you can take a nest egg half that size, and generate anywhere between $49,500 to $79,500 annually in dividend cash.… Read more

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3 Once-in-a-Decade Dividend Buys

Successful dividend investing can actually be pretty simple. Don’t trade for years, perhaps for a full decade, and then buy super high-quality dividend stocks at bargain basement prices.

One set of trades every decade. Not bad.

It’s the way of the world. There’s always something brewing. From the “original crash” of modern times, 1987, to the tech bubble bursting in 2000 or the financial world nearly collapsing in 2008.

Now, it’s 2020, and the world is again ending. We’ll make it to the other side, of course, but between here and there we are going to have a fantastic opportunity to buy blue-chip dividends.… Read more

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Warning: These 4 Popular Dividends (up to 10.1%) Are About to Be Slashed

Nearly every retirement portfolio on the planet is reeling from the coronavirus fallout. Recoveries are going to vary widely, however, depending on the safety of the dividends in each basket.

If your income stream is safe, then you’re well ahead of the game. When stock prices recover (and they will, as every bear market eventually gives way to a new bull), your portfolio is going to bounce right back. Assuming the payouts didn’t miss a beat, then you can rest assured you’ve got an uninterrupted income stream between now and then.

The bad news, however, is that cuts to dividend payouts have already started, with Ford (F) suspending its payout last Thursday.… Read more

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8 Dividend Dumpster Fires to Sell Right Now

A stock’s yield is only as good as its cash flow because, after all, a dividend is nothing more than a promise from a company.

CenturyLink (CTL) recently reminded us of this. Its promised $0.54 per share dividend exceeded its ability to pay. The firm’s payout ratio of 130% – the percentage of profits that it was paying as dividends – was an absurd overpromise that couldn’t last forever:

CenturyLink’s Payout Promise Was Always on Borrowed Time

CEO Jeffrey Storey insisted his team remained “committed to and confident in our ability to maintain the dividend.” I understood the commitment, but questioned the confidence – taking on debt to pay dividends is a losing game.… Read more

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These 3 Blue Chips Will Cost You $643,915 by 2038

Blue chip stocks are among the worst retirement investments you can make.

There are several blue-chip stocks that will actually cost you thousands of dollars each year. We’ll discuss three in a moment.

Sure, the financial media might lionize these stocks. But blue chips are simply big companies. When the term first came into being, it was simply an homage to the blue poker chip – at the time, the most valuable chip on the table. Before purples, oranges and grays began to grace the baize.

However, now the term comes with a boat load of perks – the simple assignment of the term “blue chip” is practically a buy recommendation.…
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5 Blue Chip Dividends to Sell Right Now

When blue chips get too popular – like the five I’m going to show you today – these “safe stocks” can actually be dangerous to continue holding in your portfolio.

The problem with blue-chip stocks? Call it the “Curse of the Dow.” The Curse says a stock that joins the Dow Jones Industrial Average will essentially hit a wall, underperforming in the ensuing months compared to how it performed before ascension. It’s not perfect, but it’s close – since 1999, 15 of 16 stocks that have joined the Dow have averaged 1% gains over the next six months, but averaged 11% gains in the six months before inclusion.

Why? There are a few factors, but one of the most prevailing is that by the point a stock has joined the Dow, it’s typically nearing the end of its growth ramp and reaching the slower-growth “mature” part of the business cycle. …
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