How a REIT Insider’s “Bad Timing” Made Him $91,405

Brett Owens, Chief Investment Strategist
Updated: March 20, 2019

Stephen chose a precarious time to buy. He purchased a REIT right before the sector’s ensuing rout. But it didn’t matter because he knew exactly what to buy. He banked an easy $91,405 on this investment while most first-level REIT investors sweated and treaded water.

Park Hotels & Resorts (PK) was a relatively new REIT that was spun off by Hilton Worldwide (HLT) at the beginning of 2017. Director Stephen Sadove, around this time last year, bought 9,600 shares of his own firm – right before REITs sank in an epic rout that soon unfolded.

The “dumb” REIT index VNQ was soon dumped in unison by investors.… Read more

This 7.6% Dividend Is Set To Rip Higher

Michael Foster, Investment Strategist
Updated: March 20, 2019

Tune out the nervous Nellies panicking over last week’s job numbers: they missed the real news—and their panic has handed us a straight shot at a cheap 7.6% dividend today.

More on that opportunity shortly.

First, the real story here is that wages jumped 3.4% in February, which is the fastest rate in half a century. And the unemployment rate sits at 3.8%, far lower than just two years ago, when it levitated north of 4.8%.

A Direct Line From Paychecks to Profits

I’m sure I don’t have to tell you that consumers drive the economy, and more workers, making more cash, are great news for stocks.… Read more

I Love CEFs – But I Hate These 212 Loser Funds

Brett Owens, Chief Investment Strategist
Updated: March 20, 2019

Closed-end funds (CEFs) are increasingly becoming favorites of retirees looking for income. And why not? Many pay 5%, 6% and even 7% or more today. In a world where stocks yield 2% and bonds just 3% or so, the extra dividends can be the key to a comfortable retirement.

The “closed” in CEF technically means that the fund’s pool of shares is fixed. Which is why these vehicles can have wild price swings above and below the values of their actual assets. (Good for us contrarian income seekers – we can buy below fair value to maximize our yields and upside.)

They are also closed in their actual communications with the financial world.… Read more

4 Snubbed Dividends Up to 8% Ranked Worst to First

Brett Owens, Chief Investment Strategist
Updated: March 20, 2019

At some point, someone probably gave you the following investment “advice”—or some version of it:

“All you need to do to make money in stocks is buy a company with a big-name brand, sit back and let the gains roll in.”

Sounds logical, right? After all, a household name is critical if companies want to keep their millions of fanboys (and girls) hooked.

Well, not anymore. Here’s the proof.

Big Brands: Falling Left and Right

Just look at the worst performers last year: this rogue’s gallery was stuffed with companies boasting so-called “unbeatable” brand names.

Like General Electric (GE), whose banner ranks No.… Read more

Two 7% Dividends (with upside) No One Is Talking About

Michael Foster, Investment Strategist
Updated: March 20, 2019

The headlines say it all: the economy is slowing down, right?

And with stocks soaring—up 11% year to date—we must be headed for a correction.

Both statements would be off the mark.

Because the economic numbers the government is putting out (and the press is repeating without question) are flawed. I’ll show you how in a moment.

First, let’s cut straight to the upshot: you’ve still got a great shot at buying high-yield closed-end funds (CEFs) now, particularly those that hold America’s best stocks. I’ll name two choices yielding 7.3%+ at the end of this article.

First, let’s zero in on the many economic tailwinds (some in disguise), that are driving this still-solid opportunity.… Read more

Weekly Market Summary: U.S. Stocks Take Breather From Torrid 2019 Start

David Peltier, Senior Investment Analyst
Updated: March 20, 2019

After a record hot start in the first two months of 2019, U.S. stocks cooled off during the first week of March.

Slower economic growth prospects around the globe this week caused global investors to take some risk off the table and shift buying into bonds.

On Monday, China lowered its 2019 GDP growth expectation to 6%-6.5%. The country’s economy grew 6.6% in 2018, which was its slowest rate in three almost decades. Later in the week, China said that exports fell more than 20% in February, marking the worst performance in nearly three years.

On Thursday, the ECB reinstated its targeted long-term refinancing operation (TLTRO), to help stimulate economic growth in the region.… Read more

4 Dividend Dogs That Rallied More Than Deserved – Sell Now

Brett Owens, Chief Investment Strategist
Updated: March 20, 2019

That dip didn’t last long, did it?

The S&P 500 is back around 2,800, the Dow is back around 26,000, and stocks – which frankly were never really “cheap” even in the December doldrums – are back to being hilariously overpriced. And that’s a problem on two fronts.

  1. It makes finding values – an important aspect in collecting big total returns – exceedingly difficult.
  2. The more richly stocks are priced, the harder they can fall, making dividend landmines more plentiful in the current environment.

How bad is it out there?

Here’s a look at the short-term, which shows valuations are clearly back to their pre-dip “normal.”


Data Source: Multpl.com.Read more

Revealed: The One CEF-Picking Strategy I Use Every Day

Michael Foster, Investment Strategist
Updated: March 20, 2019

Today I’m going to peer into my crystal ball and give you the scoop on where high-yield closed-end funds (CEFs) might be headed in 2019.

Then I’ll give you a proven way to zero in on the ones that are the best bargains for your portfolio now.

CEFs Come Out Flying

First, if you own stocks through CEFs (and if you don’t, click here to discover why these 7%+ payers are a retirement “must-have”), you’re already outrunning the market: my CEF Insider Equity Sub-Index—a great proxy for stock-owning CEFs—is up 13.7% since January 1, a nice lead on the S&P 500’s 12.3% gain.… Read more

8 Dividend Dumpster Fires to Sell Right Now

Brett Owens, Chief Investment Strategist
Updated: March 20, 2019

A stock’s yield is only as good as its cash flow because, after all, a dividend is nothing more than a promise from a company.

CenturyLink (CTL) recently reminded us of this. Its promised $0.54 per share dividend exceeded its ability to pay. The firm’s payout ratio of 130% – the percentage of profits that it was paying as dividends – was an absurd overpromise that couldn’t last forever:

CenturyLink’s Payout Promise Was Always on Borrowed Time

CEO Jeffrey Storey insisted his team remained “committed to and confident in our ability to maintain the dividend.” I understood the commitment, but questioned the confidence – taking on debt to pay dividends is a losing game.… Read more

Warning: This 13% Dividend Could Be the Next Kraft-Heinz

Brett Owens, Chief Investment Strategist
Updated: March 20, 2019

Let’s jump into the Kraft-Heinz (KHC) mess—because it tells us a lot about how to protect our nest egg from a Dumpster fire just like it in the future.

“Dumpster fire” is no exaggeration. KHC (which investors tend to buy for safety, remember) cratered 31% in a day on February 22, after slashing its dividend 36%.  Imagine what that would have done to your retirement portfolio (and hopefully you only have to imagine!).

Further on, we’ll smoke out three stocks (including one that pays an absurd 12.9% dividend) that could easily be the next Kraft-Heinz. If you hold them, the time to sell is now.… Read more