High-Flying Energy Stocks Yielding 9% to 27%

Brett Owens, Chief Investment Strategist
Updated: August 13, 2022

Dividend-paying energy stocks are probably going to be the best place to collect income for the rest of the decade.

This is great news because the rest of the stock market is expensive and overheated again. Never thought we’d see it with the Fed tightening, but here we are.

Fortunately we have a dip to buy in energy dividends. These stocks have taken a breather after running up at a blistering pace since April 2020.

(Back when oil prices dropped below zero—to negative $37 per barrel. As contrarian dividend investors, we’ve seen it all together, haven’t we?… Read more

This 6.2% Dividend Stock Has Staying Power

Jeff Reeves, Senior Investment Analyst
Updated: August 12, 2022

Like many who are passionate about investing, I am a numbers guy. And like many people who are serious about facts and figures, it’s hard to bite my tongue when I run across egregious errors in financial media that might mislead the investing public.

Here are a few that have irked me lately that you should watch out for:

Stock splits:  Arguing that Alphabet Inc. (GOOGL) is different after its July stock split is like arguing that cutting a pizza into more slices somehow changes the quality of the crust. The value of a company or its total profits doesn’t change just because there are more shares (or slices) to go around.… Read more

3 Risks That Can Kill Your Profits in CEFs (and Cost You 10% Dividends, Too)

Michael Foster, Investment Strategist
Updated: August 11, 2022

American novelist William Faulkner once said, “In writing, you must kill your darlings”. It was a warning to other writers not to get too attached to their manuscripts, or their characters, because you always need to be willing to edit and cut down your work to make it truly brilliant.

That advice applies to investing, too. I’ve seen too many investors get emotionally attached to their stocks and funds, which causes them to hold on to losers for too long—or fail to accept that the world has changed. But if we want to minimize our losses (and of course, we always do!),… Read more

The Best Dividend Defense Stock for 2022

Brett Owens, Chief Investment Strategist
Updated: August 10, 2022

It’s a bull market in military budgets, to put it lightly. So, let’s talk about my favorite defense stock dividend for the rest of 2022 and, really, the 2020s.

The US defense budget for 2022 is a record $777 billion. Over 3% of GDP.

We are, however, only one of nine NATO countries to spend 2% or more of our GDP on military spending. This has been a stated goal of NATO since 2006, a standard currently met by less than one-third of members.

With Russia’s invasion of Ukraine entering its sixth month and China lobbing missiles over Taiwan last weekend, higher military spending across the globe is on the way.… Read more

This 7% Dividend Strategy Means You’re NEVER Too Late to Buy the Dip

Brett Owens, Chief Investment Strategist
Updated: August 9, 2022

Just a couple weeks ago, many folks thought they had lots of time to grab beaten-down stocks like Amazon.com (AMZN) and Microsoft (MSFT). Since then, these blue-chips have really popped:

Techs Bounce—But We Can Still Buy Cheap (With 7%+ Dividends, Too)

Fortunately there is a way we can still buy AMZN and MSFT at “pre-launch” prices. And collect 7%+ yields, too!

We’re not buying the shares directly. We’re smarter than that. We’re picking these stocks up with the types of 7%+ dividends we favor in Contrarian Income Reportat steep discounts to their market prices.

This “dividend discount” method lets us “turn back the clock” and buy the dip after the dip has already happened!Read more

3 Buys to “Squeeze” Amazon for an 8% Dividend

Michael Foster, Investment Strategist
Updated: August 8, 2022

I’m always shocked when dividend investors ignore tech stocks. Which means I’m shocked a lot, because pretty well all income-seekers do it!

That’s because most folks still think of technology as the home of profitless startups, crumbling crypto platforms or zero-dividend names like Tesla (TSLA) and Amazon.com (AMZN).

But the truth is, big caps dominate the tech space, and on the whole, the sector is sitting on some of the biggest cash hoards on Wall Street. Apple (AAPL), of course, holds a legendary $202 billion. As of February, that amounted to more than 7% of the cash holdings of all S&P 500 companies!… Read more

4 Great REITs for the Rest of 2022 and Beyond

Brett Owens, Chief Investment Strategist
Updated: August 6, 2022

REITs (real estate investment trusts) are still delivering roughly twice the income of the broader market. And that’s just the sector average.

Four highly profitable REITs in particular are yielding 4% and up today. We’ll discuss them in a moment.

Interest rates are rising, and “common wisdom” says it’s a bad time to buy REITs because they behave like bonds. Wrong.

As long as the economy keeps chugging along, and these specific rents are getting paid, then the dividends are going to continue being dished. Period. And we’re all about the dividends here at Contrarian Outlook.

S&P Global research notes that rising interest rates “are frequently associated with economic growth and rising inflation, which can indeed be a boon for the real estate sector.… Read more

Harness 5%+ Dividends With “Small Ball” Stocks Like This One

Jeff Reeves, Senior Investment Analyst
Updated: August 5, 2022

One of my favorite things about the summer months is minor league baseball. You can get a dog and a beer on the cheap, most games are followed by fireworks and there’s no hour-long wait to pull out of the parking lot.

Besides, if you’re a student of baseball then there’s so much to appreciate. Talent in the big leagues makes it all look easy. And while the minors is messy at times, it makes you appreciate the importance of things like shrewd baserunning, taking pitches or placing the perfect bunt.

I love the investing version of “small ball,” too. Less flashy long-term plays may not ever become household names, but that doesn’t mean they aren’t valuable players in your portfolio as a whole.… Read more

Contrarians: How We’ll Tap This Market Bounce for Cheap 7%+ Dividends

Michael Foster, Investment Strategist
Updated: August 4, 2022

Over the last few months, I’ve seen dividend investors make the same mistake over and over: they constantly forget that the stock market always looks forward, not backward.

Making this easy blunder now could cost you a chance to grab cheap 7%+ dividends in closed-end funds (CEFs)—and potentially set yourself up for years of steady cash payouts and price gains.

Shaking Off “Investor Shell Shock”

I know it’s tough to believe in this market bounce after the many cruel twists stocks have dealt us this year. And to be honest, it could take a long time for the market to fully find its footing.… Read more

The Fatal Flaw in the World’s Most Popular Dividend ETF

Brett Owens, Chief Investment Strategist
Updated: August 3, 2022

“Brett, what do you think of SCHD?”

As soon as I heard the “C” I figured we were talking Schwab US Dividend Equity ETF (SCHD). (Your income strategist can typically “name that dividend ticker” in two beats!)

“Eh,” I replied, visibly struggling to string together a positive response to my AAII presentation attendee.

“SCHD owns some good names. A few,” I shrugged.

“It will generally keep you out of trouble.”

Safety is all the rage in 2022. Pain has been felt on both ends of the stock-and-bond spectrum.

Stocks are down because the Federal Reserve is tightening. Bonds, meanwhile, are supposed to balance the ship when stocks sink.… Read more