Author Archive: Brett Owens

An income-focused money manager friend of mine bragged to me about what he did for one of his clients.

Namely, he’s used his Contrarian Income Report subscription to smartly help her turn a modest nest egg of about $390,000 into monthly income payouts that should last…well, virtually forever.

Three years ago, he explained how he used my “retire on monthly dividends” strategy to help this nice grandmother. Here was the situation:

“She brought me $387,000 … and wants to take out $3,000 per month for 10 years.”

Well, so far, so good for Grandma.

She’s now 38 months into her $3,000-per-month dividend gravy train.… Read more

Everything is expensive—except for these dividend payers.

These bargains are left on the board because they fell so far, so fast in 2020 that the market’s subsequence bounce couldn’t quite pull them out of the gutter.

So, yields of 8.9% remain, with 89% price upside attached to them to boot. This “sure bet” sector is consolidating as we speak. Make a note of it, because when this breather wraps up, these dividend stocks could really soar.

We’ll talk specifics on these out-of-favor plays in a moment. First, let’s appreciate why this “free dividend money” is sitting out there for us to scoop up.… Read more

There are dozens of huge yields out there that no one ever talks about. I’m talking about payouts 6-times (or bigger) than the pathetic 1.5% dividend the typical blue-chip stock pays.

Swapping Dividend Yield for Shareholder Yield 

These big “hidden yields” really are hiding in plain sight. The key to finding them is to set aside dividend yield for a moment and focus on shareholder yield.

Shareholder yield is a simple measure that goes beyond dividends to show you the big-picture view of what you’re pulling in from a stock—including another way companies pay us that doesn’t get nearly enough press (or at least nearly enough positive press!).… Read more

Dividends are back. And here are 54 secure payouts that are due for a raise between now and March.

The S&P yields a lousy 1.6% as I write. It’s sad to imagine a hefty million bucks in stocks could toss off a mere $16,000 in annual income. So, we income investors need a better play.

And that, my friend, is where these rising dividends come in. They are a “double threat” because we have two ways to win:

1. The current yield, which (in many cases) will clear the 1.6% I mentioned. Plus,
2. The price appreciation that comes along with the dividend increase.

The yield on the 10-year Treasury is exhausted after its epic run to nearly 1.2%. It’s due for a breather.

Anyone who buys the long bond today can still “lock in” a 1.1% yield. But remember, this bounty won’t escape the tax man. Any interest income we earn from Treasuries—no matter how sad—is subject to federal and state taxes.

So, if we’re multiplying your nest egg (let’s use $500K) by 1.1%, we must remember that the final answer is probably not $5,500 in annual income. Because if we’re raking in income from any other sources, we should lop off a chunk of this for taxes.… Read more

Long-term interest rates have awoken. The trend toward higher Treasury yields is likely just getting started, which makes 2021 an “inflection year” for us income investors.

And what better way to celebrate the paradigm shift than to buy dividend payers that are likely to double (or better!) in the months and years ahead?

Sure, some fixed-income plays are going to be punished. That’s a topic for another time. Today, we should focus on shareholder-yield darlings that see their profits increase in an outsized manner when interest rates climb.

I’m talking about stocks that will shower us with:

• Current yields today,
• Dividend raises tomorrow,
• Generous stock buybacks, and (most importantly)
• Share prices that will climb dramatically.

As Wall Street loses its mind over a long bond that pays a lousy 1%, we level-headed income investors are going to stay calm. And 7.7% on.

Yes, we “prefer” (hint, hint) dividends that are 7X the weak 1% yield the wonks are clamoring about. I’ll get to the specifics on these retirement makers—which we can buy as easily as common stocks—in a moment. First, let’s appreciate their dividend grandeur.

The Fed is content to sit on a near-zero benchmark rate until at least next year if not 2023. Compounding the problem is that yields on traditional blue chips, while always insufficient, are a downright mockery right now—the 1.55% current yield on the S&P 500 is its lowest point in 15 years.… Read more

This time last week, we talked about my favorite dividend stock for 2021. The stock yielded 6% as recently as June, but it (deservedly) gained a following among income investors in recent months.

These newcomers bid its price up (again, deservedly). In doing so, its yield shrank below 4%, and I recently found myself apologizing to my Contrarian Income Report subscribers for discussing a stock that paid so little by our admittedly lofty standards.

Well, I’m glad I brought it up to them and to you in these pages last week, because Synovus (SNV) soared 11% over the next three days.… Read more

Let’s start 2021 with a proven strategy for grabbing two growing income streams in one buy. Plus, we’ll nicely set ourselves up to bank double-digit price gains to boot.

The strategy? Simple: we’re buying dividend-paying stocks poised to spin off one of their businesses into a brand-new dividend-paying stock. When that happens, we wind up with two or more quarterly dividends where there used to be just one.

Two other things you should know: our “new” dividend(s) will likely grow faster than our original payout! And we won’t have to do anything to get this extra cash.

I’ll give you a telltale sign to look for as we move to front-run the next “dividend split” in a moment.… Read more

For income investors, dividend strategies don’t come any easier than the “Dogs of the Dow.”

But does this simple technique still work?

We’ll look at the 2021 Dogs, and their attached dividends (and prospects) in a moment. Their yields aren’t too shabby, averaging 4.1% in a 1% world! First, let’s review the mechanics of the popular contrarian strategy:

• Step 1: After the final trading day of the year, we identify the 10 highest-yielding stocks in the Dow.
• Step 2: We buy all 10 in equal amounts.

That’s it. In just a couple of quick steps, executed just once every year, we can put together a mini-portfolio of 10 blue-chip stocks that typically out-yield the S&P 500, and currently offer 2.5 times more dividends than the broad market index.… Read more