Author Archive: Brett Owens

When you think of emerging markets, what comes to mind? Growth opportunities are likely first on the list … followed ever so closely by stomach-churning volatility.

What you probably don’t think about is income. But even in EMs, investors can dredge up some considerable dividend yield.

We all know the basic emerging market investment thesis: These “emerging” countries typically feature much more robust economic growth and quickly expanding middle classes. As a result, the companies there are expected to rapidly grow as they both feed off that greater economic pie, and as their operations become international in nature, building revenues around the rest of the world.… Read more

Looking for cheap stocks throwing off double-digit dividend hikes in 2017?

Bad news: it’s getting tougher to dig up these hallowed companies—and easier to fall victim to a dividend cut.

Consider the S&P 500, the be-all-and-end-all for most people when it comes to stock picking.

According to FactSet, 44 of the index’s constituents had payout ratios (or the percentage of earnings headed out the door as dividends) that were above 100% in Q3. That’s nearly 9% of the index, the second-highest total in a decade.

Not good.

Meantime, the S&P 500’s average payout ratio hit 40.2% during the quarter, the highest level in seven years.… Read more

The 10-year’s yield up to 2.6%? Big deal – you and I still aren’t retiring off it!

Hence the appeal of closed-end funds (CEFs), which often pay 8% or better. That’s the difference between a paltry minimum-wage income of $26,000 on a million bucks in capital, or a respectable $80,000 annually.

And if you’re smart about your CEF purchases, you can even buy them at discounts and snare some price upside to boot!

Unfortunately this rising rate environment has income seekers scared of CEFs. Many of our Contrarian Income Report subscribers are writing in to ask if they should bail on our high paying vehicles.… Read more

If you’re cutting back on stocks because interest rates are rising, you’re making a mistake.

But don’t just take my word for it (after all, I am a dyed-in-the-wool dividend-stock fan). Ask Ned Davis Research, which released its latest research on the relationship between stocks and rates about a year ago.

The finding? When the Fed moved slowly on rate hikes, stocks dropped immediately after each announcement … but went on to gain 10.8%, on average, in the next 12 months.

And as I’ve mentioned before, when Ned Davis’s researchers took a longer view—from January 1972 through December 2014, a period that saw far faster rate hikes than we’ll likely see this time around—they found that dividend growers outshine any other kind of stock, and not by a little.… Read more

The investment mantra “Don’t fight the Fed” may soon be replaced by a timelier one.

Don’t fight Trump Tower!

The S&P 500 has returned 4.3% in the month since the election. But certain sectors (such as banks and energy) have climbed even higher, faster. While others (such as REITs) initially languished.

Some of these moves are due to correct. But we also have a set of spectacular dividend growers selling for their cheapest prices this decade. Let’s sort through these Trump trades to find the remaining pockets of value for yield and price upside.

Banks: Below Book No Longer

As recently as spring, some of the best banks on the planet were selling for less than their book value.… Read more

With the election in the rear-view—and Inauguration Day just a few weeks off—plenty of investors have asked me what they should do with their portfolios now.

I’ll name five bargain dividend growers that should be on your buy list in a moment. But first, here are 2 sectors—and 9 stocks—you need to handle with care.

Let These 4 Growth Rockets Cool Down

On October 3, I pounded the table on defense stocks, namely Raytheon (RTN) and Northrop Grumman (NOC), and infrastructure plays Cummins (CMI) and Parker Hannifin (PH).

I hope you followed that advice, because all four have beaten the SPDR S&P 500 ETF (SPY) since then.… Read more

If you could earn 5% to 6% in income every year from a stock you don’t have to watch … you’d hold it today, right?

Well, if you don’t already, here’s your wake-up call.

Preferred stocks are a rarely talked about type of corporate equity that packs a one-two punch of high yield and low volatility. But that’s not why they’re called “preferred” – that moniker comes from the fact that preferred dividends take priority over common shares’ dividends, and must be paid out first. If a company wants to cut or suspend its payouts, it must do so to common shares before preferred shares.… Read more

The last time this happened, municipal bonds soared 40% over the next 12 months.

These usually-steady payers are coming off their worst month since September 2008, according to Standard & Poor’s, when its “muni” index dropped 4.8% (and popular funds fared even worse):

The Last Muni Bloodbath in Sept 2008…

October 1, 2008 didn’t mark the bottom for munis. But it turned out to be a pretty good time to buy, with these funds returning up to 38.4% in the ensuing 12 months!

… Gave Way to This 12-Month Muni Boom

Those were scary times. The financial world was melting down, and prominent pundits feared that municipalities would be the next wave of defaults.… Read more