I’ve always loved telco stocks.#-ad_banner-# As investors, we’re told to train ourselves to look at stocks rationally and to remove emotion from the process. Warren Buffett warns that your stock won’t tell you it loves you when you come home at night. But dividend investing is also about finding great yield — and, with a tip of the hat to Willie Sutton, telco stocks are where the money is. Investors have almost always done well with domestic heavyweights AT&T (NYSE: T) and Verizon (NYSE: VZ). But I’ve always found more yield and value in international telco stocks. Vodafone Group (NYSE:… Read More

I’ve always loved telco stocks.#-ad_banner-# As investors, we’re told to train ourselves to look at stocks rationally and to remove emotion from the process. Warren Buffett warns that your stock won’t tell you it loves you when you come home at night. But dividend investing is also about finding great yield — and, with a tip of the hat to Willie Sutton, telco stocks are where the money is. Investors have almost always done well with domestic heavyweights AT&T (NYSE: T) and Verizon (NYSE: VZ). But I’ve always found more yield and value in international telco stocks. Vodafone Group (NYSE: VOD) has always been a good holding thanks to the British company’s investment in Verizon (a 41% stake before its recent sale) and its focus on emerging and frontier markets. Telefonica Brasil (NYSE: VIV) has the yield and value characteristics I look for in an international telco stock. The Sao Paulo-based telecom provides fixed-line and mobile communications, broadband Internet and pay TV services, among other offerings. A subsidiary of global telecom conglomerate Telefonica (NYSE: TEF), Telefonica Brasil serves nearly 28% of Brazil’s wireless market under the Vivo brand. Yet VIV is off by more than 30% from its 52-week high. Read More

It’s interesting how movies can be strangely prescient.#-ad_banner-#​ For example, take George Romero’s campy 1978 horror thriller, “Dawn of the Dead.” Filmed partially inside a north Pittsburgh shopping mall, it focused on murderous, undead zombies in search of human flesh to dine upon. Yes, I know, a ridiculous premise, but the movie contains a classic, prophetic scene of zombies being the only creatures inhabiting the local indoor shopping mall.  Surveying the mall full of zombies, one of the zombie hunters asks, “Why do they come here?” A zombie-hunting scientist answers: “Some kind of instinct. Memory of what they… Read More

It’s interesting how movies can be strangely prescient.#-ad_banner-#​ For example, take George Romero’s campy 1978 horror thriller, “Dawn of the Dead.” Filmed partially inside a north Pittsburgh shopping mall, it focused on murderous, undead zombies in search of human flesh to dine upon. Yes, I know, a ridiculous premise, but the movie contains a classic, prophetic scene of zombies being the only creatures inhabiting the local indoor shopping mall.  Surveying the mall full of zombies, one of the zombie hunters asks, “Why do they come here?” A zombie-hunting scientist answers: “Some kind of instinct. Memory of what they used to do. This was an important place in their lives.” Back when the movie was filmed, indoor malls were the most popular place for shopping. The movie was reflecting just how fashionable mall shopping had become in the ‘70s — but today, America is littered with dead and dying malls. Many indoor mall operators would be thrilled if even zombies showed up to shop.  Things have gotten so bad at indoor malls that Green Street Advisors, a research firm specializing in real estate investment trusts (REITs), has forecast that 10% of the nearly 1,000 large… Read More

Look over a typical dividend investor portfolio, and you’ll probably find the usual utility stock suspects: Southern Co. (NYSE: SO), American Electric Power (NYSE: AEP), Consolidated Edison (NYSE: ED). These are the biggest of the big domestic power generators. You can set your watch by their cash flow, which means you know what kind of dividends to expect. But they don’t grow much. Because of the highly regulated nature of the business, there’s little opportunity to expand their footprint or unlock special value for shareholders. When this happens, stock prices don’t move much. Just look at the price action of… Read More

Look over a typical dividend investor portfolio, and you’ll probably find the usual utility stock suspects: Southern Co. (NYSE: SO), American Electric Power (NYSE: AEP), Consolidated Edison (NYSE: ED). These are the biggest of the big domestic power generators. You can set your watch by their cash flow, which means you know what kind of dividends to expect. But they don’t grow much. Because of the highly regulated nature of the business, there’s little opportunity to expand their footprint or unlock special value for shareholders. When this happens, stock prices don’t move much. Just look at the price action of the Dow Jones Utility Average over the past half-decade: #-ad_banner-#A five-year average annual return of better than 13% is nothing to sneeze at. Investors have always gravitated toward utilities for their stable income and safety during turbulent markets. However, when equity markets are in full-tilt boogie, utility stocks typically underperform. What about the best of both worlds? Is there an investment that provides dependably high income with growth superior to that of the Dow Jones Utilities? I’ve found a utility stock that provides a great, safe income stream and has outperformed the Dow Jones Utilities by over 70%… Read More

Saddled with a pile of debt and a looming war with England, France was in desperate need of cash in 1803. So Napoleon took the same course of action that many publicly traded companies do today — asset liquidation. The ensuing Louisiana Purchase was sealed for $15 million, or just 3 cents per acre. Thomas Jefferson’s emissaries to France struck an incredible bargain. They acquired a territory that stretched from the Gulf Coast to Canada, essentially doubling the size of the fledgling United States. France didn’t know it, but Jefferson was willing to pay $10 million just for the city… Read More

Saddled with a pile of debt and a looming war with England, France was in desperate need of cash in 1803. So Napoleon took the same course of action that many publicly traded companies do today — asset liquidation. The ensuing Louisiana Purchase was sealed for $15 million, or just 3 cents per acre. Thomas Jefferson’s emissaries to France struck an incredible bargain. They acquired a territory that stretched from the Gulf Coast to Canada, essentially doubling the size of the fledgling United States. France didn’t know it, but Jefferson was willing to pay $10 million just for the city of New Orleans. Control of the strategic port secured navigation and trade along the Mississippi River, which is what he was really after. #-ad_banner-#For half a century, this would be the cheapest and most transformative land grab in the nation’s history. But it was outdone in 1867, when Russia (a motivated seller that also feared war with England at the time) ceded what would later become the state of Alaska for $7.2 million. This purchase netted more than twice the land area of Texas for just 2 cents an acre. That’s an amazing deal — even before you consider the… Read More

People ask me about my most profitable investment. It was an investment I made back in October 1999. Today, it pays me a yield equivalent to 27%, and it has forever changed how I look for income opportunities. #-ad_banner-#In 1999, I was speaking at an economic conference in New York. During one of the breaks, I struck up a conversation with two gentlemen who both happened to work in the oil and gas business. At the time, I was doing some consulting work for a lawsuit involving a number of large oil companies and had been knee-deep in oil price… Read More

People ask me about my most profitable investment. It was an investment I made back in October 1999. Today, it pays me a yield equivalent to 27%, and it has forever changed how I look for income opportunities. #-ad_banner-#In 1999, I was speaking at an economic conference in New York. During one of the breaks, I struck up a conversation with two gentlemen who both happened to work in the oil and gas business. At the time, I was doing some consulting work for a lawsuit involving a number of large oil companies and had been knee-deep in oil price and production data. Oil and natural gas prices had been on a steady 20-year decline following the “oil shock” of 1979. By the time 1999 rolled around, analysts had universally soured on the sector. Prices were going lower, they said. In March 1999, The Economist devoted a whole issue to the glut of world oil.  Discussing the future price for oil, The Economist said, “$10 [per barrel] might actually be too optimistic. We may be heading for $5.” In October 1999, I didn’t agree with the analysts or the common view that oil prices were going to sink lower. As… Read More

The past few years have been a great time to be an investor. Federal Reserve Chairman Ben Bernanke’s zero interest rate policy has fueled large gains in just about every market sector since 2009. There’s little question that his policies are bullish in the short term, but what happens when the Fed’s easy money stops?#-ad_banner-#​ For an answer to this, we can take a page out of baseball history. In 1998, Mark McGwire hit a record 70 home runs during the season, while Sammy Sosa hit 66. The previous record of 61 home runs had been… Read More

The past few years have been a great time to be an investor. Federal Reserve Chairman Ben Bernanke’s zero interest rate policy has fueled large gains in just about every market sector since 2009. There’s little question that his policies are bullish in the short term, but what happens when the Fed’s easy money stops?#-ad_banner-#​ For an answer to this, we can take a page out of baseball history. In 1998, Mark McGwire hit a record 70 home runs during the season, while Sammy Sosa hit 66. The previous record of 61 home runs had been set in 1961 by Roger Maris. In 2001, Barry Bonds broke McGwire’s record by hitting 73 home runs. At the time, baseball was an exciting sport to watch as home run records captured headlines. Later, fans learned that the hitters were abusing steroids. Home run outputs returned to normal after leaguewide steroid testing became the norm in 2003. Fed policy is acting like a performance-enhancing drug for the market. When it stops easing, I believe the markets will be unable to continue climbing at the frantic pace seen during the past year. Returns will be below average for some time,… Read More

I received this message in my inbox recently. It brings up a good point and captures what I imagine a lot of my readers have in their minds… “We own gobs of stocks in High-Yield Investing. Instead of having more and more new additions, would you consider adding to an existing holding?” – Lloyd F. #-ad_banner-#When you cover several exciting new investment ideas month after month, it doesn’t take very long to build a large collection of stocks and bonds. The current High-Yield Investing portfolio is diverse, but manageable. I keep close daily tabs on all of our holdings. Still,… Read More

I received this message in my inbox recently. It brings up a good point and captures what I imagine a lot of my readers have in their minds… “We own gobs of stocks in High-Yield Investing. Instead of having more and more new additions, would you consider adding to an existing holding?” – Lloyd F. #-ad_banner-#When you cover several exciting new investment ideas month after month, it doesn’t take very long to build a large collection of stocks and bonds. The current High-Yield Investing portfolio is diverse, but manageable. I keep close daily tabs on all of our holdings. Still, I wanted to accommodate Lloyd’s request in today’s essay — not because there is a shortage of new candidates, but because this is an opportune time to revisit an old favorite. And it remains a stellar dividend payer to this day…  As they say, sometimes your best new investment idea is a stock you already own. And subscribers who have joined within the past couple of years might be unfamiliar with this particular story. This company’s progress in recent years has been nothing short of amazing. I could tell you all about it, but I’d rather show you. The chart… Read More

Dividend yield or dividend growth? Investors are often asked to choose between one of these two types of yield plays. But it’s not the right question to ask. Instead, you want to find stocks with fast-growing dividends that will eventually sport high yields. But let’s face it, so many companies in the S&P 500 were content to aggressively boost their dividends a few years back, and now seem to simply nudge the payout just a bit higher each year. Here are some examples: Indeed, the outlook for dividend growth in the S&P 500 is… Read More

Dividend yield or dividend growth? Investors are often asked to choose between one of these two types of yield plays. But it’s not the right question to ask. Instead, you want to find stocks with fast-growing dividends that will eventually sport high yields. But let’s face it, so many companies in the S&P 500 were content to aggressively boost their dividends a few years back, and now seem to simply nudge the payout just a bit higher each year. Here are some examples: Indeed, the outlook for dividend growth in the S&P 500 is likely to be much more muted in coming years, with earnings per share (EPS) growth — not rapidly rising payout ratios — becoming the prime determinant. But as with any rule, there are clear exceptions. Some companies appear poised for robust dividend growth in coming years, thanks to still-low payout ratios, and by the time the process is done, dividend yields (based on today’s prices) are likely to be stellar. Here are three companies poised for great dividend growth. 1. Boeing (NYSE: BA ) Roughly a decade ago, when demand for airplanes began to surge, this aircraft maker decided to… Read More

Not too long ago, I hit a big milestone.  I officially received my 50,000th dollar in dividend income from my Daily Paycheck portfolio. I’m not trying to brag. Instead, I want to show you how I did it, and how you could possibly too.  #-ad_banner-#A little less than four years ago, StreetAuthority co-founder Paul Tracy challenged me to build a portfolio of dividend stocks that would pay out more than 30 dividend checks a month — one for every day of the year. He even gave me $200,000 and a dedicated brokerage account to get started. I collected the very… Read More

Not too long ago, I hit a big milestone.  I officially received my 50,000th dollar in dividend income from my Daily Paycheck portfolio. I’m not trying to brag. Instead, I want to show you how I did it, and how you could possibly too.  #-ad_banner-#A little less than four years ago, StreetAuthority co-founder Paul Tracy challenged me to build a portfolio of dividend stocks that would pay out more than 30 dividend checks a month — one for every day of the year. He even gave me $200,000 and a dedicated brokerage account to get started. I collected the very first dividend from my real-money portfolio on December 24, 2009 — just a few weeks after launching The Daily Paycheck advisory. It was issued by Invesco Value Municipal Income Fund (NYSE: IIM). My first dividend was for $18.13, or 7 1/4 cents per share for my initial holding of 250 shares. It doesn’t sound like the most promising start. After all, $18.13 won’t get you very far toward retirement — that is unless you reinvest dividends and have a bit of time. As of today, I’ve received 46 dividends from IIM for a total of $953.02. My latest dividend was… Read More

One of my favorite scenes from the classic movie “Wall Street” is the boardroom scene when Bud Fox realizes that Gordon Gekko is going to dismantle Blue Star Airlines piece by piece. A portly, bespectacled investment banker glibly says: “No sweat. We sell the gates and pawn the planes off on the Mexicans. Do we have a deal or what?”  Sure, there are more action-packed parts of the flick. But to me, that particular scene helps explain what investing is all about: buying an asset and watching as the value is realized or unlocked. I’ve… Read More

One of my favorite scenes from the classic movie “Wall Street” is the boardroom scene when Bud Fox realizes that Gordon Gekko is going to dismantle Blue Star Airlines piece by piece. A portly, bespectacled investment banker glibly says: “No sweat. We sell the gates and pawn the planes off on the Mexicans. Do we have a deal or what?”  Sure, there are more action-packed parts of the flick. But to me, that particular scene helps explain what investing is all about: buying an asset and watching as the value is realized or unlocked. I’ve found a stock that fits that scenario that, coincidentally, is also in the airplane business: Fly Leasing (NYSE: FLY). Based in Dublin, Fly Leasing is in the commercial aircraft leasing business. Airlines are increasingly turning to operating leases to supply their fleets. In fact, over one third of the world’s airline fleet is leased.  Basically, the companies are renting the planes to avoid having a gigantic, swiftly depreciating asset sitting on its balance sheet. Firms like Fly assume the risk. Why? As that portly investment banker implied, you can always find someone who needs a plane. Read More