Buy This, Not That: These 7%+ Alternatives Crush High Yielding Stocks

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The market’s fall pullback is starting to reverse itself, but don’t worry: there are still bargain dividend payers yielding 7.4%+ dividends to be had out there.

But investing (along with everything in our lives!) has changed. You simply won’t get safe, high payouts by clutching to old habits and buying big-name, high-yielding S&P 500 stocks. The real dividend bargains are in closed-end funds (CEFs), which give you higher payouts, greater safety and often better returns over the long haul.

To show you what I mean, let’s line up three S&P 500 “dividend darlings” against the CEF competition and see how they compare.… Read more

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These 31 dividends are more than just safe. They are likely going up between now and October!

Recently, S&P Dow Jones Indices’ Howard Silverblatt put a hard number on 2020’s tough dividend decay, writing that second-quarter payouts were whittled down by $42.5 billion during the second quarter. The worst might now be over. Here’s a key excerpt from Silverblatt’s latest note about the month of July (emphasis mine):

“There were significantly fewer dividend actions, as 15 issues increased their dividend rates, one issue initiated dividends, two decreased them (including Wells Fargo’s USD 6.8 billion cut, the second-largest in index history), and one suspended them.Read more

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“Money printer go brrrrrrrrr!”

This humorous investor war cry making the social media rounds these days is all you need to know about the Federal Reserve’s tactics to fight off the coronavirus. Jerome Powell is printing money like there’s no tomorrow.

In fact, since March, he’s created more than $3 trillion fresh dollars! This has been the largest money creation event in the history of the planet.

Powell Prints, Money Supply Soars

More money is lousy news for each outstanding greenback. The US dollar is starting to tailspin lower thanks to a flood of supply:

More Dollars Means Each One is Worth Less

What dividends do we buy when the dollar is weak?… Read more

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A blue-chip dividend portfolio pays about 2% today. Put a million bucks into a bucket of these stocks and you’ll bank just $20,000 in yearly dividends. That’s barely extra change–on a million invested!

There’s a better way. I prefer to focus on stocks and funds that simply aren’t as familiar as the big names to most investors. They do offer growth potential. But most importantly, they don’t sacrifice yield for perceived safety. In fact, they yield roughly 3x to 4x the blue-chip stocks, providing a lot more retirement-income cushion in years where the market stalls.

Most people love the idea of this Perfect Income Portfolio, yet millions of retirees across the country find themselves piled into the same group of overowned, overpriced blue chips because the “traditional wisdom” says that’s what retirement is supposed to look like.… Read more

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Almost every corner of the market is overpriced today. That includes dividend stocks, which cost too much and yield too little.

The S&P 500 is at multi-year highs in almost every valuation metric: P/E, P/B, P/S … you name it. And a lot of that froth is coming from traditional income sectors. Yardeni Research’s latest sector study shows that utility stocks, for instance, trade at 18 times estimates, at the very high end of its 10-year range. The sector’s typically high yields, meanwhile, have dried up to a mere 3%.

Hey! Where’d the Dividends Go?

The real estate industry is getting pricey, too, with the iShares U.S.Read more

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Almost every corner of the market is overpriced today. That includes dividend stocks, which cost too much and yield too little.

The S&P 500 is at multi-year highs in almost every valuation metric: P/E, P/B, P/S … you name it. And a lot of that froth is coming from traditional income sectors. Yardeni Research’s latest sector study shows that utility stocks, for instance, trade at 18 times estimates, at the very high end of its 10-year range. The sector’s typically high yields, meanwhile, have dried up to a mere 3%.

Hey! Where’d the Dividends Go?

The real estate industry is getting pricey, too, with the iShares U.S.Read more

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“Hey Brett, what do you think of telecom?”

“Well, let’s take Verizon (VZ). It pays a 5% dividend. It’s growing that dividend by about 2% or so per year. So I’d expect the stock to return 7% or so in the years ahead,” I replied.

“What about profitability metrics like return on invested capital (ROIC)? Or margins? Or…?” my investor friend rebutted.

“If it doesn’t flow through to a higher dividend, then it doesn’t really matter.”

I was “grilled” with many thoughtful dividend-related questions while speaking to subscribers and fellow income hounds at Denver’s AAII (American Association of Individual Investors) chapter last week.…
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Most people are chasing big dividend payers right now in this “2% world” we live in. Meanwhile, a small group of “hidden yield” stocks are quietly handing smart investors growing income streams PLUS annual returns of 12%, 17.3%, or more.

Let’s talk about how to find these stocks, and bank 12% returns or better every single year, by following a simple two-step formula.

See, everyone wants dividend stocks with good current yields. It’s easy to scan a newspaper or financial website and pick out the stocks that are paying 3%, 4%, 8% or whatever number you might consider “good.”

Yet that’s NOT the right way to pick dividend stocks.…
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