These Utility Dividends Up to 10% Are Riding the AI High

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These Utility Dividends Up to 10% Are Riding the AI High

Wall Street still treats utilities like income relics. Big mistake.

The same wires and substations that power your home now feed NVIDIA’s data centers—and our portfolios. These “boring” utilities are morphing into AI toll collectors, handing us up to 10.4% dividends while vanilla investors chase momentum stocks.

Take Texas, for example. The grid is strained. The population is popping. New residents, factories and AI campuses are all plugging into the state’s aging grid at once. The math is no longer “mathing” and it’s about to get worse. ERCOT projects power demand will jump 62% by 2030—yikes!

And Oncor, the state’s largest utility, believes that is way too conservative.… Read more

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This “AI Fund” Pays 9.9% (But It’s a Trap Ready to Spring)

The AI data-center buildout is all over the news, and for good reason: It’s quite literally upending the economy.

That’s set up plenty of opportunities for us income investors to cash in. But in a moment, we’re going to talk about one specific fund we need to sell yesterday. It yields a sharp 9.9% now. The problem? It’s nearly 2X overvalued!

It’s easy to see what’s catching investors’ attention on the data center front: Investment in AI’s computing backbone is on track to contribute more to US economic growth than the American consumer.

To say that this is incredible is an understatement.… Read more

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3 Big Dividends About to Crash (One Is 89% Overvalued!)

I’m sure you’ve noticed that the media has been fretting about a selloff in the last few weeks. But the S&P 500 is still up a lot on the year.

Even so, there is cause for concern about overvaluation, as the market’s current gain is equal to a whole year’s worth of historical returns, on average. But the softness we’ve seen lately, combined with the deep April selloff, do suggest that while stock valuations are high, we’re not in a bubble—at least not yet.

Which brings me to our beat at my CEF Insider service—closed-end funds (CEFs), many of which yield 8%+.… Read more

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This 10% Payer Is the AI Boom’s “Stealth Dividend”

The AI boom still has plenty of room to run—but investing purely in AI stocks is not the best way to tap into it.

NVIDIA (NVDA) and friends yield next to nothing! And these are crowded trades.

Luckily for us, there’s another way to get in. Bargains are still available in the corner of the market we’ll get into below—as are 10%+ dividends. It’s all tied into AI’s voracious appetite for electricity. Yes, utilities are part of this play, but we want to go a little bit deeper and zero in on stocks specifically tied into nuclear power.

We’re going to tap into those through high-yield closed-end funds (CEFs) that both trade at discounts and send huge payouts our way, too.… Read more

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Overpriced, Overhyped and Due for a Fall: 3 Big Dividends to Sell Now

We just saw the first real signs that the “vibecession” is becoming something more—and this is our cue to pluck from our portfolios (or avoid adding!) three funds that are way into bubble territory. (Names and tickers below.)

Let’s start with that slowdown signal.

In this chart, from Apollo Global Management, we see that the total number of Americans who are only making the minimum payments on their credit cards is at its highest level in over a decade. This tells us that inflation and a slowdown in the job market are putting direct (and increasing) pressure on household budgets.

There are other signs, too.… Read more

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Overpriced, Overhyped and Due for a Fall: 3 Big Dividends to Sell Now

We just saw the first real signs that the “vibecession” is becoming something more—and this is our cue to pluck from our portfolios (or avoid adding!) three funds that are way into bubble territory. (Names and tickers below.)

Let’s start with that slowdown signal.

In this chart, from Apollo Global Management, we see that the total number of Americans who are only making the minimum payments on their credit cards is at its highest level in over a decade. This tells us that inflation and a slowdown in the job market are putting direct (and increasing) pressure on household budgets.

There are other signs, too.… Read more

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These Misunderstood 8.7% Yielders Are Top Buys for 2025

The thing most people love about closed-end funds (CEFs) is, well, pretty straightforward: the dividends! With these income plays kicking out average yields of 8.7%, they really can go a long way to helping us secure a safe retirement.

Beyond that, though, there are many other reasons why CEFs should be in your portfolio. Access to a collection of high-quality assets, for example, since CEFs are well-regulated and hold a wide range of assets, including stocks, bonds and real estate investment trusts (REITs).

Still, with yields that high, it’s fair to wonder if CEFs’ payouts might not be sustainable over the long haul, especially since S&P 500 index funds yield just 1.3%.… Read more

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The “Stealth” Funds That Pay $1,000 a Month on Every $100K Invested

I can’t tell you how many times I’ve mentioned closed-end funds (CEFs) to investors and been met with blank stares in return.

It’s too bad more people don’t know about these powerful income plays because …

  1. CEFs let you diversify, not only within stocks but beyond them. Among the 500 or so CEFs out there are funds that own stocks, corporate bonds, municipal bonds, real estate investment trusts (REITs) and more.
  2. CEFs often trade at discount to net asset value (NAV, or the value of their portfolios). This means we can buy shares of high-quality firms like Apple (AAPL) for less than market value.

… Read more

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Make This Investing Mistake, Lose 54% (or More) of Your Money

At my CEF Insider service, a fund’s discount to net asset value (NAV, or the value of its underlying portfolio) is one of the first things we look at when deciding whether to issue a buy call.

That’s because it can tip us off to a bargain-priced CEF, just like price-to-earnings (P/E) ratios do for regular stocks. But as with P/E ratios, the discount to NAV is not the be-all and end-all when it comes to making a buy decision.

The Discount to NAV Is Just the First Step in Our Research …

It’s easy to see why some investors put too much weight on the discount to NAV, though.… Read more

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Utilities Aren’t Boring with Yields up to 11%

Vanilla investors are freaking out that Jerome Powell & Co. won’t cut rates right away.

Who cares if we’re buying safe yields up to 11.0% like the three we’re about to highlight. This trio is positioned to benefit from an upcoming bull run in utility stocks:

“To be sure, long rates might hover around these levels for a bit. But the Fed’s rate hikes will eventually add up, and the much-talked-about recession will arrive. That will result in lower interest rates, both on the ‘short’ end (controlled by the Fed) and the ‘long’ (determined by the 10-year Treasury rate). As rates fall, the prices of bonds and ‘bond proxies,’ like utilities, will pop.”

… Read more

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