Frantic investors are blindly selling the big dividend payers in an all-out “rate hike panic.” But you’ll usually make money buying into panics rather than selling them. And this time it’s no different.

There are high quality stocks that pay yields of 5-6% or better that should be at the top of your watch list. Conventional wisdom says that they’ll perform poorly in a rising rate environment. That’s a lazy blanket statement from “first-level thinkers” that just hasn’t been the case historically.

If you’re a regular reader, you know that I’ve been eyeing Real Estate Investment Trusts (REITs) lately.… Read more

The most interesting offering from Big Tech actually isn’t the latest phone, app, platform, watch or tablet – it’s dividends. Tech darlings Microsoft (MSFT), Apple (AAPL), International Business Machines (IBM) and Cisco (CSCO) are delivering strong earnings and increasingly attractive dividends.

First-level investors usually gravitate towards utilities, energy, and large caps for yield. Few income investors immediately think of big tech. And that’s a shame, because some tech titans are now paying a secure 2-4%. (I highlighted two of them a couple weeks ago).

Where did these big dividends come from? A lack of love from investors. Many older tech firms are transitioning into new products and segments.… Read more

There’s a select, newly flush group of small banks that appear every year. They essentially mint their own pile of money by taking advantage of a financial phenomenon known as a second-step conversion. In the ensuing months and years after the event, management often shovels it back to shareholders in the form of buybacks and dividends.

The “Class of 2016” is getting ready to swing into action, and many of them will reward their shareholders with double-digit returns next year. It’s a simple formula – they’re going to use their extra cash to buy back lots of their cheap shares.

You’re probably familiar with initial public offerings, or IPOs.… Read more

Many investors think tech stocks are simply too risky to put in their income portfolios. They’re missing out, because these days, tech companies are throwing off more dividend cash than any sector this side of financials.

According to second-quarter numbers from FactSet, the tech sector paid out a combined $59.6 billion in the 12 months ending June 30, just shy of the $67.7 billion financial firms handed out to investors. The sector’s top dividend payers likely won’t surprise you: Apple (AAPL), kicked out $11.4 billion, with Microsoft (MSFT) close behind at $9.9 billion.

Even bearish analysts are giving the thumbs-up to dividend-paying tech stocks.… Read more

It happened again. Income-seeking investors piled into a 3% payer under the guise of dividend growth and safety… and they lost 10% in a single day.

Wal-Mart (WMT) lured them in and lowered their net worth this time. Before the drop, the company’s yield was at an all-time high of 3.1% thanks to 42 years of consecutive payout increases. The aristocratic allure of this dividend-payer tempted forward-looking fans. They envisioned today’s payout compounding itself in their portfolio at previous growth rates.

But Wal-Mart bulls missed several risk factors while fantasizing about their 2025 dividend payments. And they mistakenly believed a 3% yield would be sufficient to buffer any bad news.… Read more

China’s slowdown and a raft of scandals—Volkswagen’s (VW) emissions clunker being the latest—have kept nervous investors away from auto stocks this year.

Their first-level knee-jerk reactions are costing them income. Right now, General Motors (GM) and Ford Motor Company (F) offer yields around 4%. And both companies should have no trouble paying their shareholders for years to come, thanks to robust sales that, despite mainstream naysaying, actually still have plenty of room to run.

US Car Demand: Shifting Into Second Gear

US car sales have been on a tear, and that continued in September, when consumers drove 1.44 million cars and trucks off dealers’ lots, up 16% year-over-year.… Read more

Many income investors are so desperate for dividends today that they’re piling into practically any large stated yield they find. On the surface this may seem like a sound approach. After all, if the market pulls back again, dividends should support the stock prices of those that pay.

If the dividend is still there, that is. When companies slash dividends, investors typically slash their stock prices by double-digits. Recent dividend cutters have been pummeled in the months after announcing lower payouts ahead:

Fortunately it’s possible to steer clear of the next dividend disaster, thanks to a new “DIVCON screen” put together by the income strategy gurus at Reality Shares Advisors.… Read more