Rant About It

Archive for the ‘High Dividend’ Category

Beware: Outrageously high numbers…

Posted by rantaboutit on February 6, 2007

I had previously written about high dividend stocks. I would like to extend this post to include few more stocks that give outrageous yields. (As high as 45.80%). But wait….there is a catch…..!!!

  1. Royce Focus Trust, Inc. FUND operates as a diversified, closed-end investment company. The trust invests in the stocks and bonds in various sectors. They claim to pay dividend of $4.80/share and yield of outrageously high 45.80%. Is this kind of yield justified ? As per my research the last payment was made for $1.20/share, which multipled by 4 will give you 4.80$ which is right on track. Caution: Last four payments added up to only $1.57 which yields to only 14.5%. Do your own research to ensure that they will continue to pay $1.20/share every quarter and this is not a sham.

  2. Cal-Bay International, Inc. CBAY.OB invests in real-estate market. The company had interests in Utah, Nevada, Florida and California. They claim to pay dividend of $0.01/share and yield of outrageously high 41.70%. Caution: The company has made one dividend payment in the month of April 2006. The stock trades at 0.028$/share causing the yield to be so high.Since the company has only paid one dividend, you can’t rely on it in the future.

  3. Polyair Inter Pack, Inc. PPK engages in the manufacture and distribution of protective packaging products and swimming pool products. They claim to pay dividend of $0.81/share and yield of outrageously high 37.00%. Caution: They are only one-time dividend payer.

  4. Latin American Discovery Fund, Inc. LDF operates as a closed-end management investment company. The fund invests primarily in Latin American equity securities. They claim to pay dividend of $9.00/share and yield of outrageously high 33.80%. They pay dividend every six months. The mid-year dividend is small and the year-end is large. Caution: The year-end dividend relies on capital gains as opposed to dividend distributions from the stocks in the portfolio. Can you rely on such a stock for high dividend.

  5. Nicholas-Applegate Intl & Premium Strategy Fund NAI operates as a diversified, closed-end management investment company. The fund intends to invest in international markets. They claim to pay dividend of $9.28/share and yield of outrageously high 31.00%. Caution: The fund pays only at year end which includes capital gains which makes it unreliable.

  6. Templeton Emerging Markets Fund EMF operates as a closed-end investment company. It primarily invests in equity securities. They claim to pay dividend of $5.25/share and yield of outrageously high 30.50%. Caution: The fund pays only at year end which includes capital gains which makes it unreliable.

Conclusion: Some stocks look to be yielding outrageous numbers. They are attention grabbers. But are they genuine ? Maybe, maybe not. Not all high yielding stocks are bad. Again i urge my readers to read read and read…do you own research before jumping into any such high yield stock.

Recommendation:
As a rule of thumb, always always check the number of payments made out by these high yield stocks. Ensure the dividend payment is consistent. Also make sure that the payment doesnt rely on capital gains. And finally make sure that the yield is calculated correctly from whichever source you use to monitor such stocks.
Advertisements

Posted in High Dividend, Investment, Investor, Stock Picks, Traders | Leave a Comment »

Bet on high dividend stocks…

Posted by rantaboutit on January 29, 2007

With the way the stock market is behaving, it is sometimes better to play with less volatile stocks. High dividend paying stocks fit the bill. For starters according to Investopedia,
Dividend is the distribution of a portion of a company’s earnings, decided by the board of directors, to a class of its shareholders. The dividend is most often quoted in terms of the dollar amount each share receives. It can also be quoted in terms of a percent of the current market price, referred to as dividend yield.

High dividend stocks are safe bet among cautious investors. Even if the price of the stock goes down, the high dividend paid by the company will compensate for the loss. Most of the high dividend stocks do not fluctuate alot and infact few good stocks see a steady rise in the price.

High dividend stocks i recommend:

  • Frontline Ltd. FRO with Dividend of $10.00/share and Yield of 30.70%
  • Novastar Financial Inc. NFI with Dividend of $5.60/share and Yield of 25.90%
  • New Century Financial Corp. NEW with Dividend of $7.60/share and Yield of 25.30%
  • HomeBanc Corp. HMB with Dividend of $0.80/share and Yield of 25.20%
  • Knightsbridge Tankers Ltd. VLCCF with Dividend of $4.00/share and Yield of 16.20%
  • Nordic American Tanker Shipping Ltd. NAT with Dividend of $5.28/share and Yield of 15.20%
  • TNR Technical Inc. TNRK.OB with Dividend of $4.75/share and Yield of 14.90%

The returns range from 30.70% to 14.90%. These returns are definitely lucrative compared to what the banks offer. I recommend my readers to do your own research about these stocks and invest accordingly.

Posted in High Dividend | 2 Comments »