Author Archive: Brett Owens

Three years ago, I wrote to you from the La-Z-Boy in my kids’ room. Which wasn’t unusual. We were all stuck at home staring at whatever immediate family we were sheltered in place with. It was April 3, 2020.

(Ah, 2020. Family walks were the highlight of the day. Our investment strategist—and survivalist father—took no chances when leaving the house. Here’s one from the archives that recently resurfaced on my wife’s phone…)

Six packs in a stroller? The norm. What was unusual was the content of the note I penned to you before the big walk. Favor Stocks Over Bonds was the topic, strange coming from a guy who writes about bonds for a living.… Read more

I know it’s only August, but I’m ready to make my first “dividend prediction” for 2024: utilities—especially growth utilities—will surge.

That means now is the time to dust off our parents’ playbook and grab these rock-steady payers before the mainstream crowd comes around. When they do, it’ll be goodbye NVIDIA (NVDA) and hello Consolidated Edison (ED)—one of the three stocks we’ll discuss below.

The Coming “Rate Rollover” Just Got Moved Up

We’re bullish on utilities now because this economy is bogging out. We got more proof of that last week, with China posting an anemic 0.8% growth rate in Q2.… Read more

As contrarian investors, we have no desire to buy the stock market while it’s hot. We wait for it to cool off. And cooling off it is.

Three weeks ago, I warned that NVIDIA Corp (NVDA) was pricey. On cue, the stock sank 10%!

It’s since bounced, but I’m not sure the bottom is in for this bubbly darling. More tears are likely.

So what to buy instead? I’m intrigued by stocks that have the ability to soar while the broader market sinks. That’s a strategy we employed previously with semiconductor maker Texas Instruments (TXN).

Below is a chart of TXN’s performance over the last decade.… Read more

Please keep this between you and me. I don’t want to have to explain this again to every vanilla income investor out there.

But it’s important. And timely, thanks to the current revival in volatility.

Dividend stocks, at times like these, can do more than simply dish out income. They can make us filthy rich, too.

Yeah, I know. The promise of price gains can be “over the top” here in Dividendland. Most of us are content to grind, grind, grind. Send us our payouts and keep our portfolios intact.

If you’re a current Contrarian Income Report subscriber, you are well versed in this approach—and better than most!… Read more

There are plenty of stocks out there, right now, with payouts growing fast—heck, some of them give shareholders a “raise” every three months.

You won’t find these “Dividend Accelerators” among the big names of the Dow.

A number of them are real estate investment trusts (REITs)—“landlords” of everything from apartments to warehouses. And they’re not just dividend-growth machines; most throw off higher current yields than the typical S&P stock, too.

And I mean much higher: right now, the REIT benchmark Vanguard Real Estate ETF (VNQ) yields 4.5% as I write. The typical S&P 500 name? A sorry 1.5%.

You can thank the federal government for that: it gives REITs a pass on corporate taxes as long as they pay 90% of their income as dividends.… Read more

Let’s talk about the cheapest dividend payers in the world. With respect to cold hard cash flow.

We contrarians are too savvy for P/E ratios. We know that earnings are accounting creations. “Profits” are all fugayzi.

Free cash flow (FCF), on the other hand, is what it is. The cash a company brings in, minus capital expenditures. This cash can be reinvested in the business or, better yet, paid out to income investors like us.

We like companies that dish dividends because their businesses are running on relative autopilot. They needn’t plow every dollar they raise back in. Which is great—more yield for us.… Read more

Everyone hates bonds right now. Perfect—let’s buy this nifty 9.5% payer while it’s discounted!

Why the sale? A bearish narrative, of course. In 2023, we have a narrative for everything, after all.

Last week, the Bank of Japan (BOJ) announced it is softening “yield control” efforts for 10-year Japanese government bonds (JGBs). Inflation is finally picking up in Japan, and the BOJ is still printing money to buy JGBs.

Ironic? Yes. But the BOJ, the money-printing addict, is finally admitting it has a problem. We can think of this as step two of a potential multi-step inflation recovery effort.… Read more

Few folks know it,  but there’s a comically ignored indicator that regularly hands out safe 8%+ dividends—plus payouts that surge double-digits.

I’m talking about insider buying.

When it comes to the buys and sells of the folks in corporate C-suites, Peter Lynch said it best: “Insiders may sell their shares for any number of reasons, but they buy them for only one: the think the price will rise.”

Far be it for me to “edit” Lynch, but I’d add one more thing: these ballers also think the dividend is safe.

Think about it for a second: dividend safety is priority No.… Read more

Is there still a chance to buy the bank dip? You bet—with nifty yields up to 9.4%!

We’re going to avoid the regional lenders, which pains me to say because I love banking with the small guys. But I’m not looking to own them as the economy slows down.

No, nothing personal, but I’ll take the banking behemoths. None of them yield 9.4%, of course, but we engineer these payouts easily via their preferred dividends.

Preferred stocks are often referred to as stock-bond “hybrids” given that they share some characteristics of each asset. A quick breakdown:

• They represent ownership in a company (like a stock)
• They typically don’t offer voting rights (like a bond)
• They pay dividends (like a stock)
• Their dividends are typically fixed at a certain level (like a bond)
• They can rise and decline based on the performance of the underlying company (like a stock)
• But they tend to be much more stable, trading around a “par value” like a bond)

Most noteworthy, for income fanatics like you and I, is that their dividends are plump.… Read more

You and I, my fellow contrarian, are old enough to remember when “I bonds”—US savings bonds designed to protect you from inflation—yielded 9.62%.

It was May 2022. Just 14 months ago!

Ah, the good ol’ days. Since then, Series I savings bond rates have tumbled to 4.3%.

Many readers wrote in with I bond questions earlier this year. The savings vehicles boasted a still sweet 6.89%. But they had two major limitations:

• I bonds tie up our money for a year.
• We can only invest $15,000 in them annually.

(The annual limit is $10,000 per person, plus an extra $5,000 per year if using a federal tax refund.… Read more