Like people, companies sometimes fail to adequately manage their finances for so long that something eventually has to give. And that’s just what I think is happening with one well-known company with a reputation for safety, reliability and far-above-average dividend yields. #-ad_banner-#Right now, the firm’s payout is $3.50 a share, which is good for an 8.2% yield based on a recent stock price of around $42.50. The stock’s yield has averaged 7.5% annually for a decade. I wouldn’t rush to invest just yet, though, because I strongly suspect this dividend party can’t last much longer. Investors who buy… Read More

Like people, companies sometimes fail to adequately manage their finances for so long that something eventually has to give. And that’s just what I think is happening with one well-known company with a reputation for safety, reliability and far-above-average dividend yields. #-ad_banner-#Right now, the firm’s payout is $3.50 a share, which is good for an 8.2% yield based on a recent stock price of around $42.50. The stock’s yield has averaged 7.5% annually for a decade. I wouldn’t rush to invest just yet, though, because I strongly suspect this dividend party can’t last much longer. Investors who buy now thinking they’ll get yields north of 8% might soon be in for a nasty shock in the form of a major dividend cut. I’m referring to Suburban Propane Partners (NYSE: SPH), a leading national fuel distributor with 1.2 million residential, commercial, industrial, and agricultural customers and annual revenue of $1.7 billion. Propane is the firm’s main business, accounting for about 70% of revenue. However, fuel oil, natural gas, and electricity also generate substantial sales, as do the installation and servicing of heating, ventilation, and air conditioning systems. In January, analysts at Goldman Sachs actually downgraded Suburban to from “neutral”… Read More

Bond investors have a good thing going for them. They finance part of a company’s operations in exchange for a return of capital at a later date and pocket steady interest payments along the way.  #-ad_banner-#True, they miss out on any growth the company might have, but for the most part they’re exposed to minimal risk. But what if you could have both an equity position and receive a high yield as well? Enter the master limited partnership (MLP). This asset class behaves much like common stocks do; they’re highly liquid, and as a shareholder, you benefit from… Read More

Bond investors have a good thing going for them. They finance part of a company’s operations in exchange for a return of capital at a later date and pocket steady interest payments along the way.  #-ad_banner-#True, they miss out on any growth the company might have, but for the most part they’re exposed to minimal risk. But what if you could have both an equity position and receive a high yield as well? Enter the master limited partnership (MLP). This asset class behaves much like common stocks do; they’re highly liquid, and as a shareholder, you benefit from the growth of the company. The secret to the appeal of MLPs lies in the tax treatment. Unlike a standard corporation, MLPs aren’t required to pay any taxes; instead they pass it on to unit holders.  The net effective tax rate for corporations in the U.S. is 40%. Dividends are issued only after all taxes have been taken out. Because MLPs bypass taxation, they pay out 90% or more of profits to the shareholder resulting in higher than average dividend yields.  MLPs are primarily tied to energy commodities, a sector that’s been red-hot for the past couple of years. Thanks… Read More

When it comes to beating the market, dividends have always reigned supreme. If you’d invested $100,000 in the S&P 500 back in 1982, it would have been worth $2.3 million by the end of 2011. If you would have invested that same amount in dividend payers, you’d have $4.3 million. Not bad. That’s where most investors stop. But if you’d invested the same amount of cash using a simple strategy that too many investors often ignore, then it would have been worth $6.7 million. #-ad_banner-#Many investors searching for the best total returns will simply look for… Read More

When it comes to beating the market, dividends have always reigned supreme. If you’d invested $100,000 in the S&P 500 back in 1982, it would have been worth $2.3 million by the end of 2011. If you would have invested that same amount in dividend payers, you’d have $4.3 million. Not bad. That’s where most investors stop. But if you’d invested the same amount of cash using a simple strategy that too many investors often ignore, then it would have been worth $6.7 million. #-ad_banner-#Many investors searching for the best total returns will simply look for stocks with high dividends. That makes sense. But dividends don’t tell the whole story — not even half of it. If you’re looking for more cash from your investments, you should be looking at all of the ways a company distributes its cash. Don’t get me wrong — dividends can be a great indicator of company health. From 1972 through 2011, members of the S&P that don’t pay dividends returned just 1.4% per year, turning a $1,000 investment into just $1,710 according to research by Ned Davis. Meanwhile, companies that pay dividends returned 8.6% annually — significantly more than those… Read More

After two market crashes in less than two decades and the current bull market looking to take a breather, investors are rightly worried about their hard-earned gains. By investing in companies with wide economic moats and a history of total returns to shareholders, investors can reduce the pain of the market cycle and plan for the long term. #-ad_banner-#Not only do I overweight my portfolio with these long-term investments, but I like to look at stocks that are poised benefit from huge secular changes over the decades to come — stocks benefiting from megatrends like the American energy revolution and… Read More

After two market crashes in less than two decades and the current bull market looking to take a breather, investors are rightly worried about their hard-earned gains. By investing in companies with wide economic moats and a history of total returns to shareholders, investors can reduce the pain of the market cycle and plan for the long term. #-ad_banner-#Not only do I overweight my portfolio with these long-term investments, but I like to look at stocks that are poised benefit from huge secular changes over the decades to come — stocks benefiting from megatrends like the American energy revolution and aging demographics. Combine shares of a company with a great long-term track record with one of these megatrends, and you’ve got something truly special. Rich Valuations In Health Care  U.S. census data show nearly 80 million Americans were born between 1946 and 1964 — the “baby boom” generation. More than 10,000 people reach the age of retirement every day in the United States, a pace that is expected through 2030.  The demand for health care could drive medical costs higher by 6.2% annually over the next decade, while general inflation and the economy may be stuck at annual rates… Read More

The “Best Industry To Invest In This Year” is already making people a lot of money… Regular readers know that we’ve been talking about banks a lot lately. You might recall our February 19 issue where we said that this industry could be responsible for more than half the market’s growth. So far we’ve been right… Since we first told you about banks in February, Wells Fargo (NYSE: WFC), JP Morgan (NYSE: JPM) and Bank of America (NYSE: BAC) have all established new 52-week highs. #-ad_banner-#This is a great sign for the banking industry. It’s an indication that the fears… Read More

The “Best Industry To Invest In This Year” is already making people a lot of money… Regular readers know that we’ve been talking about banks a lot lately. You might recall our February 19 issue where we said that this industry could be responsible for more than half the market’s growth. So far we’ve been right… Since we first told you about banks in February, Wells Fargo (NYSE: WFC), JP Morgan (NYSE: JPM) and Bank of America (NYSE: BAC) have all established new 52-week highs. #-ad_banner-#This is a great sign for the banking industry. It’s an indication that the fears surrounding the industry following the financial crisis are fading, and that regulators are regaining faith in America’s banking system. That’s one reason bank stocks have been on an absolute tear… This chart shows how bank stocks have been trampling the S&P 500 recently. But even after the rally, banks are still ridiculously cheap. Of the six major U.S. banks — Citigroup, Wells Fargo, Bank of America, JP Morgan, Goldman Sachs and Morgan Stanley — only Wells Fargo is trading back above its 2007 highs. Wells Fargo’s performance is unique in that it was the only major bank to… Read More

The year 2004 was one of the most exciting times of my life. The future looked bright. That was the year I beat out hundreds of candidates to enter an exclusive bond-trading program for a multi-billion-dollar brokerage firm. I was going to dig deeper than ever into the market. I was going to be around market junkies all day. And most importantly, I was going to become a trading hotshot and make a few million bucks before I turned 30. Three years later, two of those things had come true, and one had not… #-ad_banner-#After spending years fully entrenched in… Read More

The year 2004 was one of the most exciting times of my life. The future looked bright. That was the year I beat out hundreds of candidates to enter an exclusive bond-trading program for a multi-billion-dollar brokerage firm. I was going to dig deeper than ever into the market. I was going to be around market junkies all day. And most importantly, I was going to become a trading hotshot and make a few million bucks before I turned 30. Three years later, two of those things had come true, and one had not… #-ad_banner-#After spending years fully entrenched in the markets and learning from the sharpest minds in the business, I had learned a valuable lesson: trading is no quick path to riches. The cumulative effect of making a few hundred trades a day for years had left me emotionally and financially spent. I found myself at a crossroads. I had loved the market ever since joining the stock market club in sixth grade. I wasn’t ready to walk away from it completely, but it was clear that my relationship with the market needed to evolve. Transitioning out of trading was one of the hardest things I’ve ever had… Read More

Love ’em or hate ’em, there’s no denying tobacco stocks are among the best and most reliable dividend payers in the investing world. Indeed, the yields on these stocks might be as addictive as the tobacco products that made such high payouts possible in the first place. Take a look at the dividends available from today’s best-known tobacco stocks: #-ad_banner-#While these are among the industry’s most recognizable names, there’s another great tobacco stock I suspect many U.S. investors have forgotten about, perhaps because the underlying company operates mainly overseas. The stock currently trades around $110 and… Read More

Love ’em or hate ’em, there’s no denying tobacco stocks are among the best and most reliable dividend payers in the investing world. Indeed, the yields on these stocks might be as addictive as the tobacco products that made such high payouts possible in the first place. Take a look at the dividends available from today’s best-known tobacco stocks: #-ad_banner-#While these are among the industry’s most recognizable names, there’s another great tobacco stock I suspect many U.S. investors have forgotten about, perhaps because the underlying company operates mainly overseas. The stock currently trades around $110 and offers a dividend of $4.70 a share — good for a 4.3% yield that’s right in there with big names I mentioned. Most investors will recognize the firm’s top brands, such as Kent, Pall Mall, Dunhill, Newport, and Kool. These may not be in the same league as Marlboro, the world’s #1 cigarette brand by far, but they’ve been strong enough to lead the company to more than $25 billion in annual sales. Granted, Philip Morris (NYSE: PM), the company that makes Marlboro, was pulling in more than $25 billion a decade ago and now generates annual revenue north of… Read More

Imagine living in a world with stocks creating dividend yields of 20%, 30% or even over 40% on an annual basis. For income investors, that sounds like a dream come true — but the truth is, these yields exist right now.    I recently searched for the highest-yielding stocks on the U.S. stock markets. I found 10 actively traded stocks that yield between 20% and close to 50% annually. My first reaction is that there must be something wrong with the data — but these stocks actually exist. Here are three examples: #-ad_banner-#It may seem like… Read More

Imagine living in a world with stocks creating dividend yields of 20%, 30% or even over 40% on an annual basis. For income investors, that sounds like a dream come true — but the truth is, these yields exist right now.    I recently searched for the highest-yielding stocks on the U.S. stock markets. I found 10 actively traded stocks that yield between 20% and close to 50% annually. My first reaction is that there must be something wrong with the data — but these stocks actually exist. Here are three examples: #-ad_banner-#It may seem like all an investor needs to do is invest in one or more of these names and their portfolio will grow like wildfire. However, nothing is further from the truth.  Sure, several of the top 10 names will continue to pay ultra-high dividends for a while, but the dangers inherent in them are simply too high for prudent, risk-averse portfolios. Remember, a high dividend does not always indicate a successful company. Often, a high dividend yield is indicative of a plunging stock price or a failing company’s last-ditch effort to attract interest.   What’s the best way to avoid… Read More

Unlike the 30-minute infomercials on at 2 a.m. touting the latest get-rich-quick schemes, real money in real estate is made by collecting rent and long-term gains. #-ad_banner-#And as far as real money goes, there are few assets that have made more people rich than real estate. Not only is property one of the most often cited sources of wealth creation, but a recent survey of U.S. millionaires by Morgan Stanley found the asset class to be the top pick in 2014 for alternative assets. A third of respondents reported plans to buy direct ownership this… Read More

Unlike the 30-minute infomercials on at 2 a.m. touting the latest get-rich-quick schemes, real money in real estate is made by collecting rent and long-term gains. #-ad_banner-#And as far as real money goes, there are few assets that have made more people rich than real estate. Not only is property one of the most often cited sources of wealth creation, but a recent survey of U.S. millionaires by Morgan Stanley found the asset class to be the top pick in 2014 for alternative assets. A third of respondents reported plans to buy direct ownership this year, and 23% expected to invest in real estate investment trusts (REITs).  Not only does real estate provide long-term returns through appreciation and cash yield through rents, but direct ownership also carries a tax advantage through deduction of depreciation. However, it often seems the best investments are reserved for the moneyed elites. Like access to private equity and hedge funds, you need pretty deep pockets to invest in real estate. Sure, you might be able to buy a duplex or two, but you will never be able to afford diversification across regions and property types without quite a few zeroes… Read More

Right now, the entrepreneurial spirit is in the public spotlight. You can see evidence of this trend in popular television shows like “Shark Tank” — where uber-entrepreneur Mark Cuban fields pitches from wanna-be startups — “The Profit” and even the “Real Housewives” series. #-ad_banner-#Of course, the entrepreneurial spirit is especially evident in the business world — ranging from crowdfunding platforms on the Web to the IPO market for companies ready to take their stock public. Last year was a blockbuster year for IPOs, and the trend can be expected to continue in 2014. There were 222 initial public offerings in… Read More

Right now, the entrepreneurial spirit is in the public spotlight. You can see evidence of this trend in popular television shows like “Shark Tank” — where uber-entrepreneur Mark Cuban fields pitches from wanna-be startups — “The Profit” and even the “Real Housewives” series. #-ad_banner-#Of course, the entrepreneurial spirit is especially evident in the business world — ranging from crowdfunding platforms on the Web to the IPO market for companies ready to take their stock public. Last year was a blockbuster year for IPOs, and the trend can be expected to continue in 2014. There were 222 initial public offerings in in the U.S. last year, which raised a total of $54.9 billion — the most in the IPO space since 2000. Most excitingly for investors is that the average return for IPOs in 2013 has been an incredible 36%. When you consider that dozens of additional IPOs are on tap in 2014 — which Virgin Group founder Richard Branson recently predicted would be “the year of the entrepreneur” — you can see the great investment potential in the business of business. One way to ride this trend is to run your own business, as I’m sure… Read More