5 Overlooked REITs with Growing Dividends

Brett Owens, Chief Investment Strategist
Updated: March 4, 2016

Income investors, specifically those invested in stable Real Estate Investment Trusts (REITs), have been able to ignore most of the recent market mayhem. These issues have little exposure to energy prices, and China. Typically, they’re a pure U.S. economic play with stable income streams.

Plus, they’re pretty cheap right now. The Vanguard REIT Index Fund (VNQ) is paying its highest yield this decade (4.1%).

I’ve been a strong advocate of REITs since they became “too cheap” in mid-2015. After all, they’re legally required to pass along at least 90% of their earnings to shareholders. It’s a solid formula for market-beating dividend yields.

Lately, the office REIT group caught my eye. They’ve been overlooked as other segments like housing, storage, and malls have moved strongly.


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4 Dividend Stocks Superstar Investors Love – and You Should Too

Brett Owens, Chief Investment Strategist
Updated: August 4, 2016

One of my favorite ways to find new investment ideas is by keeping an eye on what the smartest players in the game are up to. That’s hardly a novel concept. After all, it’s always wise to study the greats – in investing or anything else.

But investors can do more than just watch the smart money; we can see every stock in their portfolios – and we can do it for free.

How? Through Form 13F, which every institutional investor in the U.S. with more than $100 million of assets must file with the Securities and Exchange Commission within 45 days of the end of every quarter. Once they’re in, the SEC posts them on its website, where you can search through them in a snap. …
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11 More Dividends in Serious Danger

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

First, it was Kinder Morgan (KMI). Then, ConocoPhillips (COP). Which sacred dividend is going to get cut next?

Regular readers know that I believe big oil is a big avoid for now. But if you insist on speculating in the goo patch, stick with Exxon (XOM).

There are payout problems outside of energy, too. A quick look at Reality Shares’ DIVCON screen reveals seven 4% payers in “DIVCON 1” territory. This means they’re more likely to cut their dividend than raise it. Let’s discuss these, and a few more high yielding problem children.

1 Shaky Telecom

Frontier Communications Corp. (FTR) is a good example of a sky-high yield (8.8%) that should set off alarm bells. As for a low P/E, the “E” part of the equation is non-existent—the telco has posted losses in three of the last four quarters, and the Street forecasts a loss of $0. …
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2 Drug Stocks To Buy For Safe Dividends And 20% Gains

Brett Owens, Chief Investment Strategist
Updated: February 29, 2016

With all the bloviating on the campaign trail about reeling in drug costs these days, it’s safe to say the pharmaceutical industry is under siege.

But it’s not all the politicians’ fault; many of the sector’s injuries are self-inflicted. Case in point: Valeant Pharmaceuticals (VRX), whose stock has plunged 62% amid ongoing accounting concerns.

Investors, predictably, have voted with their feet: since the start of the year, the iShares US Pharmaceuticals ETF (IHE) has plunged almost 14%, nearly tripling the S&P 500’s decline.

But as with any selloff, it’s not just sickly stocks that are being punished. It’s the healthy ones, too. I’m talking about companies that generate strong cash flows and fatten investors’ wallets with buybacks and dividends—while also fattening their pipelines through R&D and acquisitions. …
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3 Dividends You Need To Buy And 3 To Dump Immediately

Brett Owens, Chief Investment Strategist
Updated: February 28, 2016

Stocks that raise their dividend meaningfully every year will make you a lot of money over the long haul… provided they continue to boost their payouts, of course.

Studies by two global investment heavyweights, BlackRock and GMO, have shown that 90% of U.S. equity returns over the past 100 years have been thanks to dividends and dividend growth.

Ned Davis Research also conducted its own 43-year study on stock returns (from January 1972 through December 2014). The conclusion? Dividend payers are good… but dividend growers are great. Stocks that paid a growing dividend delivered double-digit returns and outpaced steady dividend payers by nearly one-third:

Annual Rate of Return (Ned Davis Research)

Dividend-Grower-Chart

Over time, this compounding really adds up as these stocks pull away from stagnant payers and the market at-large: …
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5 High Yield REITs Benefiting From Low Oil

Brett Owens, Chief Investment Strategist
Updated: February 26, 2016

Crude oil’s crash may have roiled stocks to start 2016, but cheap fuel is actually a great thing for the average American. Consumer confidence is heading higher, thanks to low gas prices and a continually improving job market. More disposable income means more fun for most Americans…

Disposable-Income-Growth

The recent Mintel American Lifestyles 2015 report shows that Americans are planning on increasing vacation travel by 27 percent. It’s a good time to buy stocks that are directly benefiting from this trend.

One of the largest online travel companies, Tripadvisor Inc (TRIP), just reported a solid quarter with increased consumer activity. And TRIP also detailed how their average monthly hotel shoppers grew by 10% year-over-year (to 113 million) in the last quarter of 2015. …
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2 Top Dividend Aristocrats for Your Retirement Portfolio

Brett Owens, Chief Investment Strategist
Updated: February 24, 2016

If you’re a retiree, or a near-retiree, you’ve probably been told you should dump—or at least reduce—your stock holdings and focus on fixed-income investments.

It sounds like a smart move, right? After all, CDs, Treasuries and the like protect your principal, while one big downturn can wipe out your stock-market gains.

But going lean on stocks leaves you open to two big risks: that you’ll outlive your savings and miss out on the long-term gains only the stock market can offer.

Consider these numbers from the Society of Actuaries: if you’re a 65-year-old man, you have a 41% chance of living to 85 and 20% odds of hitting 90. If you’re a woman of the same age, your chances jump to 53% that you’ll make 85 and 32% for 90. …
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5 Best Utilities for Dividend Growth

Brett Owens, Chief Investment Strategist
Updated: March 24, 2016

If you’re buying utility stocks for dividends, focus on the firms that are boosting their payouts the fastest. I’ll give you my top 5 in a minute. But first, let me explain why this strategy is a must for utility investors today.

The Utilities Select Sector Spider ETF (XLU) pays just 3.3% currently. This puts utility dividends near 7-year low.

The problem with buying utility stocks with low yields is that, in most cases, payout boosts aren’t going to provide much help. XLU has only raised its dividend by a total of 24% over the last 7 years. That’s less than 3.5% annually.

This means that anyone who buys XLU today will probably need to wait 12 years to see just a 5% yield on his or her initial investment. …
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3 Dividend Growers Cashing in on the Mobile Payment Boom

Brett Owens, Chief Investment Strategist
Updated: February 22, 2016

It’s a one-two punch I love to see in a stock: a growing dividend and a rock-solid commitment to research and development.

These companies serve up a profitable combo: immediate cash in your pocket and potential for huge gains—and even bigger dividend payouts—as they churn out the next wave of must-have products.

I bring this up because right now, S&P 500 companies are spending big on both R&D and dividends.

Here are the latest numbers from FactSet: in the 12 months ended September 30, 2015, S&P 500 firms poured $257.8 billion into R&D, a 10-year high. At the same time, they doled out $410.8 billion in dividend payments, also the highest total in at least a decade.

The bottom line? Now is a great time to shop for these income-focused innovators, particularly with the selloff driving their prices down—and their dividend yields up. …
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3 Energy Dividends About To Be Slashed

Brett Owens, Chief Investment Strategist
Updated: February 19, 2016

Oil prices picked up this week on the promise that Saudi Arabia and Russia would coordinate a cut in production. But surprise, surprise – there’s already speculation that they’re both going to cheat.

That’s going to keep oil prices low – and it’s going to threaten the dividends of many producers, both here and abroad. For some reason, many energy management teams believe that this inventory glut and price devaluation cannot last. Apparently they forgot what prices looked like pre-2005:

WTI-Crude-Prices

As long as money managers are making bullish bets on oil, the price is going to stay low or head lower. I warned you when crude was at $100 and again at $45 that it was going to crash for this very reason. …
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