Barron’s Finally Comes Around to Our View on Energy Dividends

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Nice to see our friends over at Barron’s finally catching up to us on the big dividends sitting right under our noses in oil and gas!

It’s almost like the magazine’s writers are sharing a subscription to our Contrarian Income Report service, because the six stocks they cited in an article they ran last week are almost all picks in our portfolio—specifically our “crash ‘n rally” energy bucket.

(It’s not the first time’s Barron’s has shadowed us. In April, they put out a strategy for retiring on dividends, a subject we literally wrote the book on two years ago.)… Read more

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Oil stocks—and their fat dividends—are breaking out to new highs.

Question for you. If Fed Chair Jay Powell hadn’t printed a bunch of money over the past 14 months, would energy stocks still be this electric?

Chairman JP Prints Lots of Money

My take? No way. Their recovery would be (much) more muted.

According to the International Energy Agency (IEA)—the best and most unbiased source of industry information I know—world oil demand is projected to hit 96.7 million barrels per day this year.

Meanwhile, global supply is just 93.6 million barrels per day. Production was halted when the world shut down a spring ago.… Read more

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“I have no clue what to do,” said a friend recently over backyard beers. “On the one hand, stocks are still rising. On the other, everything is pricey.”

I know you’re feeling my buddy’s pain—I get similar sentiments from readers of my Contrarian Income Report service all the time.

The last few weeks of wild swings sure don’t help. No doubt your finger has hovered over the buy button but you’ve hesitated, worrying you’re getting in at the top.

That’s understandable: no one wants to be the last buyer in a bull market!

Let the Market’s “Fear Indicator” Guide You to Big Gains (and Dividends)

The solution to this dilemma is a strategy only a contrarian could love—we’re going to navigate by the VIX—the market’s so-called “fear indicator.”… Read more

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If you’re a regular reader, I owe you a big congratulations on the recent profits in your dividend portfolio.

Some of you are banking big yields. Others are riding dividend magnets to capital gains. A select group of savvy contrarians are profiting from payouts and price upside.

The result of your mini windfall, regardless of source, is cash. But this pile of money is not yet generating any income for us. So, what is the best way to employ these greenbacks? We have three options:

  1. Reinvest the dividend money automatically via DRIPs,
  2. Deploy the profits strategically via smart shopping lists, or
  3. Stack the dry powder for a special moment.

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Thank you to our 1,578 Contrarian Income Report subscribers who attended our Q1 webcast a couple of weeks back!

We have you, our thoughtful reader and income investor, to thank for the inspiration behind the firehose. We received 114 questions during our one-hour call, plus several more beforehand. Amazing.

As promised, I have read each and every question (as has our excellent customer service team). Last week, we chatted about CEFs. Let’s tackle some dividend stock questions today.

Q: I love your overall dividend approach. I have some cash on the sideline expecting a correction. Any thoughts on the timing and percentage dip of that correction?Read more

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Another hand went up. I pointed for the next question.

When you consider dividend investments, Brett, what is more important in your opinion:

  • The current yield and value of the stock itself, or
  • The “engine” that is driving the business and the profits?

“Great question,” I replied. “The business engine. Always consider where the cash flow is coming from, first.”

In other words, if the business is humming, the dividends will be there. And as the payout keeps chugging along, so will the stock price. A dividend will protect the stock from downside and, with growth, provide a sweet kicker of upside.… Read more

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Everything is expensive—except for these dividend payers.

These bargains are left on the board because they fell so far, so fast in 2020 that the market’s subsequence bounce couldn’t quite pull them out of the gutter.

So, yields of 8.9% remain, with 89% price upside attached to them to boot. This “sure bet” sector is consolidating as we speak. Make a note of it, because when this breather wraps up, these dividend stocks could really soar.

We’ll talk specifics on these out-of-favor plays in a moment. First, let’s appreciate why this “free dividend money” is sitting out there for us to scoop up.… Read more

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Exactly who is retiring on the income from safe bonds in 2021?

You might remember when, once upon a time, the 10-year Treasury was a source of acceptable retirement yield:

  • Thirty years ago, we could get 7% or more for sitting on high-quality U.S. debt,
  • Twenty years ago, we could still gather 6%,
  • Even a decade ago, we were pocketing a respectable 4%.

Today? We can’t even collect a lousy 1% yield!

Buying Treasury Bonds? Congrats—You’re Broke!

Put a million bucks into 10-year Treasuries and we’re banking just $9,500 per year in income. That’s below poverty levels. Yikes.

Things aren’t any better on the stock side.… Read more

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The mainstream crowd has gotten way too greedy—which means we could be in the teeth of a stock-market selloff within weeks.

Most folks hear the word “selloff” and gasp. But not us contrarian dividend hounds! We know that volatility is our friend. It’s easy to see this just by looking at what the market’s done in the last five years. You’d have amped up your performance a lot just by buying the dips.

Buy and Hold? Nah. The Timing of Your Buys (and Sells) Matters

This year is a classic example. If you’d bought the typical S&P 500 stock on the first day of February, pretty much at the go-go peak of early 2020, you’d be sitting on a 15% total return now.… Read more

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Who doesn’t like a safe, stable utility dividend? In today’s zero-rate, VIX-spiking world, it’s a throwback to simpler times—the “old school” type of dividend we’d like to accumulate sufficiently to retire on!

Heck, twenty years ago to this date, we could have bought shares in Southern Company (SO) and enjoyed a 6.5% yield. A $100,000 stake in Southern would have paid $6,500 every year in dividends.

Plus, regular raises were on the way. After a stagnant few years, Southern began hiking its payout every year. That 6.5% yield would eventually grow to a fat 12.4% yield on cost:

Southern’s 20-Year Yield Rise

But wait, there was more.… Read more

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