Author Archive: Brett Owens

“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

I hear from readers of my Hidden Yields dividend-growth service all the time—and many are wondering why their “dividend guy” has suddenly become a “cash guy”!

Truth is, there’s been nothing for us to buy! We’ve unloaded 17 positions since last October in Hidden Yields and are sitting on a big cash pile—waiting for our chance.

And that chance is coming. In fact, if you’re using dollar-cost averaging—or investing a fixed amount of money on a fixed date, in other words—to build your portfolio, now is a great time to put money toward the safest stocks you own—especially as we get closer to “stock season”: the period from November to May, when markets are typically stronger.… Read more

Boring is perfect when we’re talking retirement investing.

We’ll let others take the S&P 500’s sad 1.7% yield and frequent mood swings. While we direct our attention to an elite trio that yields 8.2%.

You read that right. Eight-point-two-percent per year… in dividends alone! That’s an excellent $82,000 in annual income on a million dollar portfolio. Or $41,500 on a $500K nest egg. You get the idea.

Plus our yield cushion will help soften a September selloff. (Because let’s face it, this is most likely a bear market rally we’re in the middle of.)

No, the stock market doesn’t just give out 8.2% yields for nothing.… Read more

Why would anyone want to pay full price for a stock?

Many common tickers can be bought for 5%, 10% and even 12% off in the closed-end fund (CEF) aisle. These discounted CEFs are the closest thing to a free lunch we have on Wall Street. And most investors don’t know about them because, well, they don’t read enough Contrarian Outlook!

CEFs are unique vehicles. They are one of the last corners of the stock market with a sweet inefficiency. Unlike their mutual fund and ETF cousins, CEFs have fixed pools of shares. Which means they can trade at premiums and discounts to the values of their underlying assets.… Read more

These days, everyone is looking for safety—and that’s got some folks pondering some pretty, er, unusual strategies that seem secure but are in fact anything but.

One such strategy is known as dividend capture, which sounds like a way to bag a company’s quarterly cash dividend without taking the risk of owning the shares. I don’t like the name because it sounds like something we dividend investors should be interested in. I don’t like the approach itself because it doesn’t really work.

The theory seems innocent enough:

1. Find a stock that is about to pay a dividend,
2. Buy it before it’s “ex-dividend date,”
3. Pocket the payout, and
4. Sell the shares after.

Welcome back to Contrarian Outlook, the only dividend research service focused on 6% weekly returns.

What a formula! Wash any 2022 losses away with this swift “6% every seven days” solution.

I kid, of course. This rate of return, while not sustainable, sure is nice when it happens. Especially in a dumpster fire market like this one.

So thank you, UnitedHealth Group (UNH)! In these pages last week, we called out UNH as a recession-resistant stock because the health carrier is always growing EPS at a 10% annualized rate.

Thanks to these profit gains, UNH’s dividend has been doubling every few years.… Read more

Buying into companies that split their stocks tilts the odds sharply in your favor—and buying a “splitter” that grows its payout will help you do even better.

Today we’re going to look at how you can “front run” the next dividend split for fast share-price (and dividend!) growth.

“But wait,” you’re probably thinking. “Aren’t share splits meaningless when it comes to the stock’s overall value?”

True! Let’s look at the case of Amazon.com (AMZN), which performed a share split last month. After the close of trading on Friday, June 3, the company divided each of its shares (which closed at $2,447 that day) into 20 pieces, so the stock opened at $124.79 on Monday, June 6.… Read more

Well, it took seven months. We finally have some serious dividends!

Today we’re going to highlight 53 of them that yield at least 14%. That is not a typo—these 53 dividend stocks actually pay between 14.1% and 44.6%.

Are they all buys? Of course not. But why not take our calculated contrarian chances with real income stocks, rather than wasting our time with mainstream ideas?

While we are considering payout plays like these, vanilla income investors are stuck with:

• The S&P 500 yielded 1.3% to start the year. Now? About 1.7%.
• REITs, which are better but still only yield 3.1% as a group.

Some losses are just so bad it is dead money…

Look, I know several of you got into some sketchy stocks over the past couple of years. I’m not naming names but c’mon, as a dad of two young ones, I can tell when something is amiss.

Our safe dividend stocks have held up better than, well, just about anything else in this market. We’ve been cautious since late ’21, booking profits along the way. As the market topped, we sold early and often to raise cash.

So if you’re writing to me about dead money, let’s face it, you got into something bad.… Read more

Today I’m going to show you a two-part dividend-growth strategy that actually made money for one group of investors in the disastrous year that was 2008. It’s an appropriate investing strategy for us to follow now, with the Federal Reserve likely to raise rates until we end up in a recession (assuming, of course, that we’re not in one already!)

Before we get into the specifics on this technique and an example stock, I want to level with you. I do believe that stocks are heading lower still before they ultimately head higher.

That said, if we look one year out from today, I like our chances.… Read more