Author Archive: Brett Owens

As we return Mariah Carey to the ocean depths for another year, we turn our attention to our next seasonal siren—double-digit dividend stocks.

They are, after all, the perfect way to retire on dividends, right? Put $500,000 in a portfolio of 10% payers and we’re looking at $50,000 in annual dividend income. Plus we get to keep our principal.

Right?

Not always. Most double-digit divvies are “cheap for a reason.” These are dogs dressed up as dividend payers. But the payouts are often in danger. Which means price stability is equally dicey. Which is why we often say no thanks to these mega-headline yields.… Read more

Raise your hand if you want to actively work for income in 2024.

(Please note your dividend strategist already has his pointer finger in the tip of his nose. Not it!)

Here at Contrarian Outlook, we prefer passive dividend income to active income, thank you very much. Because trading hours for dollars is, let’s just say it, such a drag.

A job? Tired. Dividends, meanwhile, are wired. Since ‘tis the season for resolutions, let’s discuss my top four to retire on dividends in 2024.

Dividend Resolution #1: Project Our Income

If you’re a serious dividend investor, I hope you took my advice last week and grabbed your risk-free trial to Income Calendar.… Read more

If there’s one thing we need to remember when we buy high-yield closed-end funds (CEFs), it’s this: always demand a discount.

Well, make that two: always demand a high dividend, too! Because CEFs are renowned for their high—and often monthly—payouts, with the average CEF yielding around 8% today.

But back to discounts. Luckily for us, they’re common with CEFs: of the 422 CEFs tracked by the CEF Connect screener, 384 trade at discounts to net asset value (NAV).

That’s a great place to start our search for top-notch CEFs, because these discounts are basically free money: they let us pick up, say, Mastercard (MA) for 85 cents on the dollar through a CEF like the Gabelli Dividend & Income Trust (GDV).… Read more

Select real estate may be the income investing play for 2024. As I write, seven real estate investment trusts (REITs) are dishing dividends from 8.7% all the way up to 15.4%.

These REITs—and their ilk—are literally designed to deliver dividends. That’s how Congress wrote the rules when they legislated these real estate investments into existence back in 1960.

REITs avoid taxes at the corporate level. But in exchange, they need to pony up at least 90% of their taxable income and redistribute it to investors as dividends.

As a result, our average REIT yields somewhere around 2x to 3x the market.… Read more

If you are a serious dividend investor, then you know the answer to this question:

How much dividend income are you going to make in 2024?

In other words, what are your projected dividends next year?

If you don’t know, then you’re not as dedicated to dividends as you thought. Disappointing, but fixable with Income Calendar.

And please, don’t tell me I’m being hard on you. If that’s the way you feel, then this is the tough love that you need. Your wakeup call for 2024.

It’s time to treat your dividend investing like a business. Because it is.… Read more

I hear that robots are standing by to run the world.

Fine—just have them send us a nice, neat report on our dividends. Preferably daily. Thanks.

Seriously, my fellow contrarian, enough with the hype. I tried, albeit briefly, to use ChatGPT as a research assistant for this column. Really it was a softball that I knew the answer to:

Hello ChatGPT, how much did iShares 20+ Treasury Bond ETF (TLT) drop in 2022?

The answer, of course, was 31%, but the robot hadn’t been fed the info so didn’t know. I lost interest and carried on as usual, “manually” verifying my numbers.… Read more

Buying a business development company (BDCs) is kinda, sorta like investing like a venture capitalist (VC).

Minus the arrogance. And the lack of yields!

I was 26 when I realized that VCs were just regular guys and gals. Well, let’s be honest—mostly guys. They didn’t necessarily know anything special. But VCs play the part, sitting in their Steelcase chairs and short sleeved polo shirts while it’s 60 degrees out here in Northern California.

BDCs, on the other hand, are investments for the people. Plus, they pay—up to 15% in dividends!

Here’s a quick primer. BDCs lend to small and midsized businesses that the big banks either won’t touch.… Read more

I don’t always buy into stock bubbles. But when I do, I prefer dividend plays.

We can’t spell “mania” without AI, of course. Artificial intelligence has been the flavor of 2023. But what if—what if—the excitement around AI accelerates into 2024?

It could happen. Last week I spent half of a recent post-holiday-light-viewing dinner discussing AI with a friend. My buddy is increasingly looking to AI tools like ChatGPT and Bard to help run his services business. After all, why not—they are improving by the week and cheaper than humans. There is some steak behind the AI sizzle.

(What did we spend the other half of dinner doing?… Read more

What if I told you I’d uncovered a dividend “unicorn”: a stock with a 7.4% yield that’s hiked its payout by five digits in the last 14 years?

It’s the kind of thing that “breaks” common investing wisdom. Most folks, after all, think you can have a high yield or a fast-growing payout, but not both. Verizon (VZ) is the classic case, with its 6.9% current yield. Sure, the telco’s payout does grow, but only around a penny a year.

Verizon’s “Pay a Lot, Grow a Little” Dividend

On the other side of the scale is a company like Mastercard (MA), whose dividend has soared 500% in the last decade, from just $0.11 quarterly to today’s level of $0.66.… Read more

A safe double-digit yield makes it a lot easier to retire. Today we’ll discuss a portfolio that pays 14.1% (that’s no typo).

The math on 14.1% looks awesome. This yield generates $14,100 on a $100K every year. Or $141,000 on a million dollar portfolio.

Contrast this with “the market”—$1 million plunked into the S&P 500 would only net you $14,000 a year, which is actually below the federal poverty level!

And if you have even less to work with, well, you understand what I’m getting at.

Most importantly, if you manage to find these mega-yielders, you can finance your retirement on dividends alone.… Read more