3 Reasons to Buy These 5 Oil Refineries Right Now

Brett Owens, Chief Investment Strategist
Updated: August 16, 2016

It seems oil’s big recovery may never come. Last week, chatter from the IEA and Saudi Arabia helped oil rebound, but we’re still down 50% from 2014 prices. What’s more, continuing concerns about energy companies’ ability to pay out dividends has caused massive declines for many stocks in 2016, even after steep losses spanning two years. Some people are giving up on energy altogether.

But that would be a mistake.

Now that oil is low, we contrarians can see which companies can survive in a world of cheap energy and which companies are woefully unprepared. Surprisingly, a group of oil refineries are able to survive a world of sub-$40 oil, and now that crude has risen to over $43, these refineries are astoundingly underpriced.… Read more

2 REITs That Could Plunge 20% – and 2 to Buy Now

Brett Owens, Chief Investment Strategist
Updated: August 15, 2016

Are real estate investment trusts in a bubble? The evidence is mounting—especially in the big names many investors see as sacred.

Today we’ll look at two “frothy” trusts you should watch like a hawk if you hold them … and avoid if you don’t. Further on, I’ll show you two REITs that are terrific buys now. Both boast gaudy 6.0%+ dividend yields and have big growth ahead, too.

“O” Is for Overpriced

First, we need to talk about Realty Income (O), a giant among REITs, with a $17.9-billion market cap and 4,600 retail properties across the U.S. The stock has soared 46% in the past year, nearly tripling the 16% gain in the benchmark Vanguard REIT Index ETF (VNQ) and leaving the S&P 500, with just a 3% rise, in the dust.… Read more

4 Funds With 5% Yields and Almost No Taxes

Brett Owens, Chief Investment Strategist
Updated: August 12, 2016

Fat 5% dividends are hard to come by as stocks continue to climb. But you can actually still get those high yields – and take on less risk – by looking to the municipal bond market.

Munis also offer something else truly wonderful: tax-free dividends. That’s right, the income from most municipal bonds is tax free for most Americans. However, choosing individual municipal bonds is difficult. High minimum buy-ins force many retirees to concentrate too much of their capital in one project or municipality.

While muni defaults are rare, it’s never safe to concentrate too much money in one place, which is why municipal bond funds are a much safer alternative.… Read more

3 Utility Stocks to Sell Right Now

Brett Owens, Chief Investment Strategist
Updated: August 11, 2016

I love utility stocks for their stability and high dividends, but sometimes you have to let go of what you love – especially when things get a bit crazy.

And the insanity many investors are facing now is that many utility stocks have soared in 2016 and far outperformed the S&P 500, even when you exclude their massive dividends. These price gains crushed yields – which is why investors should ring the register, sell these stocks and redeploy profits into better yielding alternatives.

Let’s talk about three regional utility that have soared more than 30% over the past year. A great return, but the charts also tell me that we’re reaching a top and there may be little room for these utility stocks to go further.… Read more

How To Time Your Dividend Buys and Sells

Brett Owens, Chief Investment Strategist
Updated: August 10, 2016

“Are dividend stocks in a bubble? Like… the NASDAQ in 1999?”

A reporter from Kiplinger called me last week, concerned investors were bidding up these issues to irresponsible heights.

While not quite a bubble, many of the “safest” names are the worst places you could put your money today. Some are doomed to grind sideways for years while others have serious downside potential. But there’s an easy test you can run to see if you should buy, hold or sell your favorite dividend stocks – simply chart the share price versus the dividend.

Your Total Returns = Current Yield Plus Payout Growth

Over time your stock market returns will roughly equal the yield you buy today plus the dividend growth you enjoy in the years ahead.… Read more

Dump These 4 Dividend Darlings Before September 1st

Brett Owens, Chief Investment Strategist
Updated: August 8, 2016

Today I want to tell you about two hidden pitfalls that could threaten your stock returns—and four stocks that could be the first to take a tumble.

First, the pitfalls. You’ve probably heard of the first one: seasonality.

That’s the market’s tendency to outperform—or underperform—at certain times of the year. A prime example is the “sell in May strategy,” in which some investors bow out from May to October, when market gains tend to be muted.

Now the worst month for stocks—September—is nearly upon us. According to the Hulbert Financial Digest, from 1896 through 2014, the Dow Jones Industrial Average fell an average of 1.06% in September, compared to an average gain of 0.75% for all the other months.… Read more

Massive Dividend Growth and a 4% Yield with These Stocks

Brett Owens, Chief Investment Strategist
Updated: August 5, 2016

The market is on a tear, making it harder than ever for dividend growth investors to find good buys for their money. While many people expect the market will correct itself, you might be missing out on steady gains if the market continues to “melt up” thanks to low interest rates.

Fortunately, there’s a safe way to secure yield with upside to boot. While the market has bid many well-known dividend payers up to silly prices (and caused yields to crash), there are still a few lesser known names paying 4% yields with plenty of payout and price runway from here.… Read more

4 Big Dividends Slashed: What To Do Next

Brett Owens, Chief Investment Strategist
Updated: August 3, 2016

Your favorite dividend stock just chopped its payout – should you sell?

It depends. Believe it or not, some dividend cuts are actually wildly bullish signals. They mark the bad news being officially “priced in” as shares soon embark on a furious contrarian rally.

Other payout cuts, however, are red flags begging you to sell before you lose even more money. They are truly a white flag of financial distress that shows the firm failed at its sole responsibility to shareholders – to get the dividend paid.

We’ll discuss post-cut strategies in a moment, including specifics on recent dividend disappointments from the likes of American Capital Agency Corp (AGNC), Potash (POT), Williams Cos (WMB) and the iShares US Preferred Stock ETF (PFF).… Read more

Better Than Cash: 5 Recession-Proof Payouts Up To 10.3%

Brett Owens, Chief Investment Strategist
Updated: August 2, 2016

With stocks are at nosebleed levels, how about some high income issues that double as portfolio insurance? Today we’re going to discuss five dividend payers with an average payout north of 5%. All five boast recession-proof businesses.

Of course there are plenty of things to worry about in today’s financial world. Income inequality is high, restaurant sales are plummeting, and few people seem confident in America’s increasingly contentious political quagmire. Then of course there’s the slowdown in China, growing political unrest around the world, exploding student loan debt in America and rising subprime defaults in the auto loan sector. This was all reflected in Friday’s disappointing GDP results for the second quarter.… Read more

These 4 Dividend Darlings Could Drop 20%

Brett Owens, Chief Investment Strategist
Updated: August 1, 2016

I know I don’t have to tell you it’s a minefield out there for income investors.

Ten-year Treasuries yield a pathetic 1.5%, and dividend-growth stocks have been on a tear. The ProShares S&P 500 Dividend Aristocrats ETF (NOBL), which holds shares of companies that have hiked their payouts annually for 25 years or more, has soared 12% year-to-date, more than doubling the S&P 500’s gain:


That’s left many Dividend Aristocrats overvalued and ripe for a fall. Worse, it’s driven their dividend yields to historic lows.

Just take a look at food distributor Sysco (SYY), which yields 2.4% today, barely above the S&P 500 average and near lows not seen in nine years:


To get that meager yield, investors are buying a stock with a trailing-twelve-month price-to-earnings (P/E) ratio of 37, way above its five-year average of 23!… Read more