Tag: Dividend-Paying Stocks

Top Dividend Stocks for January 2021

Dividend stocks are companies that pay out a portion of their earnings to a class of shareholders on a regular basis. These companies usually are well established, with stable earnings and a long track record of distributing some of those earnings back to shareholders. These distributions are known as dividends, and may be paid out in the form of cash or as additional stock. Most dividends are paid out on a quarterly basis, but some are paid out monthly, annually, or even once in the form of a special dividend.

While dividend stocks are known for the regularity of their dividend payments, in difficult economic times even those dividends may be cut in order to preserve cash. One useful measure for investors to gauge the sustainability of a company’s dividend payments is the dividend payout ratio. The ratio is a measure of total dividends divided by net income, which tells investors how much of the company’s net income is being returned to shareholders in the form of dividends versus how much the company is retaining to invest in further growth.

If the ratio exceeds 100% or is negative (meaning net income is negative), this indicates the company may be borrowing to pay dividends. In these two cases, the dividends are at a relatively greater risk of being cut.

You may like this: Financial Ratios

Below, we look at the top 5 dividend stocks in the Russell 1000 by forward dividend yield, excluding companies with payout ratios that are either negative or in excess of 100%. Each of the dividend stocks listed below significantly underperformed the Russell 1000’s total return over the past 12 months of 19.7%, as of December 21, 2020.1 All data below is as of December 22, 2020.

Lumen Technologies Inc. (LUMN)

  • Forward Dividend Yield: 10.08%
  • Payout Ratio: 86.56%
  • Price: $9.92
  • Market Cap: $10.9 billion
  • 1-Year Total Return: -17.7%1

Lumen Technologies, formerly known as CenturyLink, is an integrated communications company that offers services including local and long-distance voice, broadband, Ethernet, colocation, hosting, data integration, video, network, information technology, and more.

Brookfield Property REIT Inc. (BPYU)

  • Forward Dividend Yield: 8.86%
  • Payout Ratio: 63.63%
  • Price: $15.01
  • Market Cap: $587.3 million
  • 1-Year Total Return: -10.0%1

Brookfield Property is a real estate investment trust (REIT) that owns, develops, builds, manages, and leases various commercial properties. Among the company’s portfolio of properties are restaurants, malls, entertainment facilities, and parking areas. On November 6, the board of directors declared a quarterly dividend of $0.3325 per share on its Class A Stock payable on December 31, 2020, and a quarterly dividend on the 6.375% Series A Cumulative Redeemable Preferred Stock of $0.39844 per share payable on January 1, 2021.2

New York Community Bancorp Inc. (NYCB)

  • Forward Dividend Yield: 6.65%
  • Payout Ratio: 82.59%
  • Price: $10.22
  • Market Cap: $4.7 billion
  • 1-Year Total Return: -8.3%1

New York Community Bancorp is a holding company with multiple banking subsidiaries, including Queens County Savings Bank, Roosevelt Savings Bank, Atlantic Bank, and others. Through these subsidiaries, New York Community Bancorp offers a full range of banking products and services to businesses and consumers. The company primarily serves customers in the New York City metropolitan area.

Brandywine Realty Trust (BDN)

  • Forward Dividend Yield: 6.50%
  • Payout Ratio: 43.84%
  • Price: $11.69
  • Market Cap: $2.0 billion
  • 1-Year Total Return: -20.2%1

Brandywine Realty Trust is a REIT that owns, manages, leases, acquires, and develops urban, downtown, and suburban office properties primarily on the East Coast and in Texas. Its services include asset management, development and construction, investment, marketing and leasing, and property management. On December 8, the board declared a quarterly cash dividend of $0.19 per common share and OP Unit payable on January 20, 2021. The quarterly dividend is equivalent to an annual rate of $0.76 per share.3 

TFS Financial Corp. (TFSL)

  • Forward Dividend Yield: 6.41%
  • Payout Ratio: 66.57%
  • Price: $17.47
  • Market Cap: $4.9 billion
  • 1-Year Total Return: -6.8%1

TFS Financial is a holding company engaged in retail consumer banking, mortgage lending, and similar services through its subsidiaries. The company’s businesses include originating and servicing residential real estate mortgage loans and attracting retail deposits. Its main business is retail consumer banking.

The comments, opinions and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or to adopt any investment strategy. While we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described on our content may not be suitable for all investors.

Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.

Compete Risk Free with $100,000 in Virtual Cash

Put your trading skills to the test with our FREE Stock Simulator. Compete with thousands of Investopedia traders and trade your way to the top! Submit trades in a virtual environment before you start risking your own money. Practice trading strategies so that when you’re ready to enter the real market, you’ve had the practice you need.

By Nathan Reiff.

GenExDividendInvestor

Top 10 Dividend Stocks – January 2021! In this video I show the top 10 stocks in January of 2021 that the thousands of dividend investors on my discord server (https://discord.gg/kkSr5FY) had the opportunity to vote for that they were buying or planning to buy. Then I’ll end this video with a powerful life story that is worth hearing and reflecting on, so I recommend you watch this entire video. Referral Link to M1 ➜ https://m1.finance/AUzJllYh-gGh To get access to my Spreadsheet 2.0 then please sign up as a Patreon Aristocrat or King (and double check my Patreon site to ensure I’m still offering access, as I only have limited seats available). You also get other perks for signing up including the ability to watch my videos on my Discord before I release them to the public, and the ability to vote on what thumbnail I’ll use in some of my future videos, and you gain direct access to me.

Support me & get Patreon perks ➜ https://www.patreon.com/genexdividend… Please join my Dividend Discord chat server: https://discord.gg/kkSr5FY Please use my Amazon Affiliates Link ➜ https://amzn.to/2YLxsiW Thanks! As an Amazon Associate I earn from qualifying purchases. My Dividend Merch Store ➜ https://teespring.com/stores/genexdiv… Donate to St. Jude’s Children Hospital: https://www.stjude.org/donate/donate-… Please LIKE, COMMENT and SUBSCRIBE to support this channel – it helps me immensely! Also, please SHARE this video with your friends 🙂 Thanks, I really appreciate it! Get more great info – Subscribe! ➜ https://www.youtube.com/c/GenExDivide… Share this Video ➜ https://youtu.be/XKyydmdmASg Watch this Video next ➜ https://youtu.be/cvbR0NwiviQ Feel free to ask questions on Instagram, Twitter, Reddit, or here on YouTube. Listen to my videos as Podcasts on iTunes, SoundCloud, Castbox.fm, etc. My Dividend Portfolio on M1 ➜ https://m1.finance/9gGguPKhh Referral Link to M1 ➜ https://m1.finance/AUzJllYh-gGh Instagram ➜ https://www.instagram.com/genexdivide… Reddit ➜ https://www.reddit.com/user/GenXDivid… Twitter ➜ https://twitter.com/GenExDividend Listen to my Videos as Podcasts on iTunes ➜ https://podcasts.apple.com/us/podcast… Listen to my Videos as Podcasts on SoundCloud ➜ https://soundcloud.com/genexdividendi… Chat with me on my Dividend Discord Server ➜ https://discord.gg/kkSr5FY Investing Books to read (as an Amazon Associate I earn from qualifying purchases): The Intelligent Investor ➜ https://amzn.to/2WPwgtj One Up on Wall Street ➜ https://amzn.to/2YTDAXt Rich Dad, Poor Dad ➜ https://amzn.to/2SUCwOZ The Richest Man in Babylon ➜ https://amzn.to/2SUHStw A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing ➜ https://amzn.to/2YUgjo4 The Bogleheads’ Guide to Investing ➜ https://amzn.to/2STECPp Other Books I Like (as an Amazon Associate I earn from qualifying purchases): Skin in the Game ➜ https://amzn.to/3fD4lFt How to Win Friends and Influence People ➜ https://amzn.to/3dxHI3p The 7 Habits of Highly Effective People ➜ https://amzn.to/2WP86iv The Five Dysfunctions of a Team: A Leadership Fable ➜ https://amzn.to/3fDXLhM My Recording Gear (as an Amazon Associate I earn from qualifying purchases): Blue Yeti Microphone – Blackout edition ➜ https://amzn.to/3cm40os Professional Foam Windscreen Cover for Blue Yeti ➜ https://amzn.to/2YVNqYG Boom Mic Stand to Clip Blue Yeti on Desk ➜ https://amzn.to/2WHsBxs Disclaimer: I am not a financial adviser. These videos are for entertainment, inspiration, and educational purposes only. Investing of any kind involves risk. I am only sharing my opinion with no guarantee of gains or losses on investments. Please consult an appropriate adviser and do your own research before making any decisions on anything. I am not responsible or liable for any actions you take. LINKS/ATTRIBUTIONS: https://www.4recruitmentservices.com/…https://thoughtcatalog.com/january-ne…https://www.developgoodhabits.com/ins… MSFT – Microsoft JNJ – Johnson & Johnson AAPL – Apple ABBV – AbbVie T – AT&T 3M – MMM JPM – JP Morgan Chase KO – Coca-Cola O – Realty Income MO — Altria Amazon – AMZN Copyright © 2021 Gen Ex Dividend Investor. All rights reserved.

Related Terms

How Determining the Dividend Rate Pays off for Investors The dividend is the percentage of a security’s price paid out as dividend income to investors. more

Special Dividend A special dividend is a non-recurring distribution of company assets, usually in the form of cash, to shareholders. more

Dividend Yield Definition The dividend yield is a financial ratio that shows how much a company pays out in dividends each year relative to its stock price. more

Dividend Payout Ratio Definition The dividend payout ratio is the measure of dividends paid out to shareholders relative to the company’s net income. more

Dividend Clientele Dividend clientele refers to a group of shareholders that have a common preference for a company’s dividend policy. more

Dividend Definition A dividend is the distribution of some of a company’s earnings to a class of its shareholders, as determined by the company’s board of directors. more

The Interest Rate Volatility And Inflation Hedge ETF: An Interview With Fund Manager Nancy Davis

1

Nancy Davis founded Quadratic Capital Management in 2013 and manages the portfolio for the firm’s Interest Rate Volatility and Inflation Hedge Exchange Traded Fund. Forbes Senior Contributor William Baldwin outlined her career and the establishment of this novel ETF in this September, 2019 article.

After the extraordinary volatility of all markets in March of this year, I wanted to follow up with Quadratic and see how the fund with volatility in its very name had managed those historic few weeks. Nancy agreed to answer a few questions and here’s how it went:

John Navin: What’s stagflation? Why should investors be concerned now?

Nancy Davis: Stagflation is an economic condition in which slow economic growth (or even contraction) occurs simultaneously with rising prices. I’m sure there’s a better definition but that’s pretty close.

Today In: Investing

  • No Time For Saviors: Black And Brown Entrepreneurs With Inspiring Responses To COVID-19

  • An Alternative To Dividend-Paying Stocks For Safety During This Pandemic

  • 5 Static Stocks That May Make A Move

Stagflation is a disastrous outcome for investors. Higher prices coupled with lower growth is a potentially terrible environment to generate positive real returns. With the virus curtailing economic activity while simultaneously disrupting and altering supply chains around the world, we could see prices for many goods rise even as the economy slows.

Policy changes that result in reductions of international trade or immigration could also be catalysts for stagflation.Investors might hope that a large bond portfolio would provide some protection in this stagflation environment, but stagflation could be difficult for holders of fixed income instruments.

Bonds could be just as likely to sell off as equities, foiling the popular “risk parity” strategy.

Quadratic Interest Rate Volatility And Inflation Hedge ETF daily price chart:

Navin: With oil prices in deflationary mode, how might inflation arise anyway?

Davis: The decrease in oil prices create a onetime deflationary shock. It is not recurring. We may see rising prices in other parts of the economy as supply chains are disrupted. Rising food prices are one example that come to mind. I’ve read about potential shortages of meat and dairy products, for example.

An economist would say that a reduction in supply should lead to a rise in the market-clearing price. Trade tensions and economic policies that prioritize national self-sufficiency could also contribute to inflationary pressure. I’m not making a prediction on inflation.

Our products don’t need a hyper inflationary environment to perform well. I believe we are among the top 5% of all ETFs in performance year to date and there’s not a lot of inflation right now.

Quadratic Interest Rate Volatility And Inflation Hedge ETF weekly price chart:

Navin: Without giving away secrets or getting too technical, how do you construct an ETF for stagflation?

Davis: In a period of stagflation, one could expect increased volatility, rising prices and higher inflation expectations. IVOL’s TIPS and options might do well in stagflation if the interest rate curve is likely to steepen and volatility increases in such an environment. We certainly do not hope for a stagflation scenario in the US, but, under such an interest rate scenario as described, IVOL’s portfolio may help.

Navin: What’s the market for your ETF? ? Mutual funds? Ordinary investors?

Davis: We have a diverse group of investors in IVOL. We have seen other fund managers use the fund.

IVOL is also an ESG fixed income fund. The ETF is an inflation protected bond strategy that is innovative and unique. We embody democratization of financial markets by providing access to inflation expectations for our shareholders.

TIPS only give you the CPI basket – it’s today’s inflation basket per the US government. Whereas IVOL gives you CPI with TIPS and the enhancement with inflation expectations given that the yield curve is largely a result of investor’s expectations for inflation in the future.

Also IVOL maybe a potentially attractive addition to a portfolio looking for diversification during a time when many other holdings may have behaved very similarly.

Navin: Average daily volume of your ETF is 47,000 shares. This is relatively low. What are your plans, if any, for increasing liquidity?

Davis: The secondary market liquidity is an important number to watch, but it does not properly reflect the underlying liquidity of the ETF. As the fund grows, I expect the secondary market liquidity to improve over time.

Institutional investors can achieve ample liquidity in IVOL. One can access massive liquidity by using the primary markets in ETFs. It is called “NAV based creates” or “NAV based redeems” for buys and sells respectively. That way investors execute their order in the primary market at the NAV (similar to a mutual fund).

I have been in the industry since 1998 but was not aware of this “technology” for trading until I learned about ETFs. And keep in mind that the fund is less than a year old.

Navin: Your ETF experienced the volatility that hit all markets in March. What’s different about “interest rate volatility?”

Davis: We have long been advocates for owning volatility, but IVOL is not a standard “long vol” product. An investor who is convinced of the benefits of owning volatility still has other decisions to make. Market commentators (and even sophisticated investors) often lump all long volatility into the same bucket. IVOL is one of the few ETFs available today that use interest rate volatility instead of equity volatility.

Equity volatility is generally limited only to options on US equities.One of the major drawbacks of any option is the negative carry. All options suffer from time decay and decline in value as time passes, all else being equal. But interest rate options have one factor that makes them different from equity options: the concept of rate roll down.

In the interest rate market, the forward rate can be significantly different from the spot rate. In the case of the options held by IVOL, whenever the interest rate curve is upward sloping, then the rates roll down could be positive and might improve the carry of the options.

This means that under these market conditions, the interest rate options owned by IVOL could have their negative time decay mitigated partially or completely by the roll down in the interest rate curve.

Of course, the inverse would also be true: if the curve is downward sloping, then the rates roll up would be an additional hurdle for the options. Historically, the curve has had a positive slope most of the time, making the positive roll down more frequent than the negative roll up.

Navin: A classic inflation hedge has been gold. Why might your ETF be an improvement over the barbarous relic?

Davis: No one gets paid coupons or dividends to own gold. It actually has storage costs which are a drag on the long run performance. This is probably OK when interest rates are very low, like now. But I would rather own things that don’t cost me money to own them. I don’t want to predict the future and anything could happen, so it is always advisable to have a diversified portfolio. Gold could be a piece of a portfolio.

I do not hold positions in these investments. No recommendations are made one way or the other.  If you’re an investor, you’d want to look much deeper into each of these situations. You can lose money trading or investing in stocks and other instruments. Always do your own independent research, due diligence and seek professional advice from a licensed investment advisor.

Follow me on Twitter or LinkedIn.
John Navin

John Navin

My Marketocracy work is profiled in The Warren Buffetts Next Door: The World’s Greatest Investors You’ve Never Heard Of by Forbes Investments Editor Matt Schifrin. I’m a graduate of the University of North Carolina.

Source: https://forbes.com

728x90-1-1-1-1

Stagflation is an economic condition with persistent high inflation combined with high unemployment and relatively stagnant demand for products. ————————————————————— Subscribe for new videos every Tuesday! http://bit.ly/1Rib5V8 Dictionary of Economics Course: http://bit.ly/2t8PNGR Additional practice questions: http://bit.ly/2JPjeby Ask a question about the video: http://bit.ly/2M2VVHP Help translate this video: http://bit.ly/2t8aqmK
%d bloggers like this: