“Buy and hope” traders are, understandably, terrified today. Their portfolios are paying nearly nothing in dividends. Don’t you think fat 10% payouts would put them at ease a bit?
The unfortunate situation for our “B&H” friends is that they bought stocks without a plan to generate cash flow from them. They purchased their shares – probably after much of the decade-long run up – and now must hope that this old bull market is not aging in dog years!
A better idea? Demanding big dividends. After all, without cash flow, what is a stock really worth besides what someone will possibly pay us for it tomorrow?
Secure 10% yields are the “rubber duckies” of the investing world. Mr. Market can push them underwater for a period of time, but eventually, they rocket up to the surface.
My Contrarian Income Report subscribers who smartly stayed with Omega Healthcare Investors (OHI) – a big paying REIT – have done much better than their scared low-yield-collecting friends as well as the broader market in general. The year actually started inauspiciously as OHI announced a dividend “freeze.” The stock slipped. But a freeze isn’t the same as a cut – and OHI didn’t cut. Its payout was well covered by its funds from operations (“FFO”).
The misunderstanding would soon be our gain, as the stock yielded 10% (thanks to years of previous dividend hikes). And anytime that OHI has paid double-digits in the past, it marked a major bottom for the stock. So why would this time be any different?
OHI’s Dividend Limits Its Price Downside
Let’s fast forward to see how OHI rallied off its most recent double-digit “yield high” to return a fast 48% including dividends!
How a 10% Yield Leads to Quick 48% Gains
It’s an income investors’ dream – banking 10% yearly payments without having to worry about a pullback for the pricey (and increasingly wobbly) stock market.
Which makes right now a good time to talk about my two favorite strategies for generating current cash flow from the stock market. Because whether stocks go up, down or meander sideways, I always want my money to be working for me – and paying me regularly (preferably 10% or more per year!)
My 10% Yield Play: High Current Yields
Our Contrarian Income Report portfolio pays 7.6% as I write. This is 4X the payout of the broader market. It means a $500,000 portfolio will pay you $38,000 per year.
That’s a lot better than the S&P 500, which would insult us income investors with its measly $9,000 annual check. But even $38,000 is likely less than your local bartender earns per year.
To earn more than $38K we must follow one of these two high yield trails:
- “Chase” higher yields of 10% or more.
Bad idea. I can get you a safe diversified dividend portfolio paying 7.6% today. But I don’t see enough double-digit payers to get us above a 10% average responsibly. (How about OHI, you ask? As its stock price has been bid up, its yield has compressed to a still-generous 7.5%.)
- “Accelerate” dividend growth stocks from 2% payers to 20%+.
This is a special system I’ve developed that allows you to collect “instant dividends” worth 5X, 10X and even 20X more than the yields listed for “first-level investors” on most financial websites. Let me explain.
My 20% Yield Play: The “Dividend Accelerator” for 10X Payouts
The beauty of the Dividend Accelerator is that you can collect “instant income” on every trade. This means you can make exponentially higher returns than what’s possible from just traditional dividends.
Most dividend growth stocks pay low current yields because their stocks are too popular. Investors pay up for their track record and prospects of future growth. But my Dividend Accelerator can fix this yield problem by providing a 3X, 5X or even 10X boost to these payouts.
For example let’s consider utility stocks. If there’s more to this pullback than we’ve seen, then its affinity for utility shares is worth noting. The S&P 500 made its recent high on September 20, but don’t tell that to these pullback-proof issues:
Utility Stocks Act Pullback-Proof
I’ve been down on the utility sector for two years now and have specifically picked on blue chips Duke Energy (DUK) and Southern Company (SO) repeatedly. I don’t have anything against these firms, but I also don’t recommend buying them when their stocks are pricey and their yields are low, as they are today.
But not all utilities are growing so slowly they could be confused with fixed income. There’s a notable exception that leaves these tortoises (and their middling dividends) in the dust.
NextEra Energy (NEE) is the largest developer of renewable energy in North America. The firm has been a fast grower for decades. No wonder it’s increased its dividend for 23 straight years!
And these have been meaningful raises – NextEra has shown up its peers with 149% dividend growth over the last decade (versus just 26% – a fraction of NextEra – for the utility sector’s widely marketed ETF):
Why NEE is the Best Utility to Buy
Thanks to the firm’s most recent payout raise, it now shovels out $1.11 per share per quarter (for 2.6% yearly).
But we can accelerate this payout to 19.5% yearly.
That’s exactly what my Options Income Alert subscribers and I have done together. My readers who sold 10 contracts per trade banked $7,050 in cash payouts without ever having to buy NEE!
$7,050 in Payouts in Just 4 Weeks
We turned NEE into our personal dividend ATM. We simply tapped it anytime I saw a setup that I liked – and then placed the put premiums directly on our pockets.
NEE’s Put Premiums: Weekly Payouts Averaging $1,762.50
These trades were as simple as buying or selling any stock or fund. We simply sold put options on NEE instead of buying or selling the stock itself.
How To Bank Your First 20% Dividend Tomorrow
I know many investors who want to learn how to do this. They know that others are doing well with options, but they’re not sure how to go from buying and selling stocks and funds to buying and selling options.
Here’s a secret – they’re almost exactly the same. And you probably have the ability to do it already from your online brokerage account.
Plus, now is the time to insulate your portfolio from a potential pullback. Stop buying and hoping – and start generating monthly cash flow (with lower risk to boot!) via dividend acceleration.
Ready to start collecting secure 20% cash yields today? I hope so, because I’m sending out my next trade alert tomorrow morning – and I want to make sure you receive it. Click here for the details on my 20% “Cash Yield” Dividend Accelerator system – and I’ll hook you up with a risk-free trial.