Many popular PIMCO closed-end funds (CEFs) have sold off particularly hard as investors fear the potential impacts of a coronavirus-driven recession. Further, large CEF premiums versus net asset values (NAVs) have evaporated into unusually large discounts as selling pressure has been intense. Further still, the price declines have been exacerbated by a drying up of liquidity in the bond markets. And even though the US Fed has dramatically increased its quantitative liquidity easing in the treasury and agency Mortgage Backed Securities (MBS) repo markets, just this week it announced that it will “be moving for the first time into corporate bonds, purchasing the investment-grade securities.” To some investors, the Fed’s essentially unlimited buying power is terrifying, and to others it is highly reassuring. Will you be betting against the Fed?
Big Monthly Dividend REIT: High E-Commerce Exposure Reduces Coronavirus Risks
This single tenant focused industrial REIT offers healthy monthly dividend payments (8.0% yield) and the potential for significant price appreciation. We believe it will benefit from the current uncertainty amid the coronavirus outbreak given its high exposure to the e-commerce sector. The trend for online shopping is a secular one but has become more prominent currently as people are forced to stay at home. We do caution that the current situation will impact the business but given its diversified portfolio and high exposure to e-commerce we expect healthy price appreciation once the situation returns to normalcy. This article reviews the health of the business, valuation, risks, dividend safety, and concludes with our opinion about why it’s worth considering if you are a long-term income-focused investor.
These 2 Big-Income Bond CEFs: Buy! Buy! Buy!
This is a very quick note, and it is intended to get this information to you quickly. There are currently a variety of attractive Bond CEF’s that are presenting extremely attractive buying opportunities based on their holdings, their currently discounted prices and their temporarily massive discounts to Net Asset Value (“NAV”). These particular Bond CEFs pay you income monthly (double-digit yields), we own them, and the current buying opportunity is highly attractive.
Buy Low: Top 10 Big-Dividend REITs, On Sale
The market has been ugly. But as they say, this too shall pass. And when it does, the most attractive buying opportunities will be gone. No one knows the exact timing of when the turmoil will end, but there are currently a lot of REITs trading at compelling prices (there is enormous fear baked in) and offering unusually attractive big dividend yields. And it’s those big dividends that can give you the steady income you need while you wait patiently for the long-term price gains to come to you. This report counts down our top 10 big-dividend REITs.
High Quality, Stable REIT: 5.6% Yield, Attractive Valuation
The recent market wide sell off has been ugly. This article focuses on a REIT that is particularly attractive considering management has been a sound steward of capital by simplifying the business model, lowering the cost of capital and growing the dividend. Further, this REIT may be poised to take advantage of current market distress thanks to its lower debt and the cushion it enjoys relative to debt covenants. If you are a long-term income-focused investor, this one is absolutely worth considering (we own it).
An Attractive Blue-Chip Healthcare REIT, Solid 5.4% Dividend Yield
This attractive blue-chip healthcare REIT offers a solid dividend and the potential for healthy long-term growth. We are impressed by its dividend history, healthy payout ratio, investment grade credit rating and significant demographic opportunity. The FFO growth outlook for 2020 is back to positive after a few years of challenges. This article reviews the health of the business, valuation, risks, dividend safety, and concludes with our opinion about why it may be worth considering if you are a long-term income-focused investor.
In the Face of Panic: Selling Income-Generating Put Options, Phillips 66 Edition
Trying to call a bottom to the current energy and coronavirus-driven market sell off is a fool’s errand. No body knows. It could end soon or it could be long and drawn out. However, it’s okay to be a bit opportunistic during the current market sell off, so long as it is consistent with your long-term investment goals (e.g. “be greedy when others are fearful,” and “buy when there is blood in the streets.”). One such opportunistic strategy that’s become particularly attractive now, is selling out-of-the-money income-generating put options on stocks you’d like to own for the long-term. This article shares one such example, Phillips 66 (PSX).
Powerful Upside: This “Income via Growth” Stock Is on Sale
From time-to-time, we like to write about “income via growth” stocks at Blue Harbinger. These are stocks that can provide high income to investors through long-term capital gains (i.e. selling some of your winners). We write about these types of stocks because they can bring important risk-reducing diversification to an otherwise dividend-focused investment portfolio. And we are writing about this particular opportunity because we own it, and because it is particularly attractive right now following the recent market turbulence.
3 Horrible Market Mistakes (To Avoid During A Volatile Market)
As the market continues to be volatile, we’re taking a moment to share some investing and trading advice that seems particularly relevant right now. You can always check out our current holdings and ratings here, and we’ll have more individual stock write-ups soon, but this article is about 3 horrible trading mistakes that many investors unfortunately make at times like this (i.e. when the market is very volatile).
Attractive 13% Yield REIT: Unfairly Punished by Mr. Market
Mr. Market was already unfairly punishing this big-dividend REIT, but the recent market wide turmoil has made the price absurdly low and attractive. In this report, we analyze the company’s income profile, growth, dividend prospects and political risks. We conclude with our opinion on whether this big yielder is worth considering for a spot in your prudently-diversified, long-term, income-focused investment portfolio.
Don’t Panic: 4 Strong Buys (Monthly Performance Update)
The market just got pummeled, and there could be significantly more short-term pain ahead. However, long-term, this market is eventually going higher (the US and global economies are just too resilient). And there are some tremendous buying opportunities, right now. This is our monthly performance update, whereby we share updated performance for each of our investment strategies (they’re all still beating their benchmarks handily, and delivering strong income, despite the recent sell off). We also share 4 strong buying opportunities presented by the market (it’s like Christmas to those with cash).
Dow Plunges 1000 Points: Here’s How You Should React
New Options Trade:High Upfront Income, Oversold Large Cap Integrated Energy
This large cap energy stock has been hit from all angles, ranging from low oil prices, to fossil fuel campaign divestment selling pressures, and now a threat of decreased short-term demand from coronavirus impacts. However, it still generates a ton of cash flow, it has a lower break even cost than many peers, and long-term demand simply is not going away (much to the chagrin of many ESG investors). What we’re left with is a big safe dividends, and very high upfront income in the options market courtesy of the recent bout of heightened fear and volatility. We believe the trade highlighted in this article is an attractive one to place today, and into early next week, so long as the underlying stock price doesn’t move dramatically before then.
Gladstone REIT: Monthly 6.9% Yield Worth Considering, +2 Attractive Preferred Series
Gladstone Commercial (GOOD) is a REIT that’s been paying an attractive monthly dividend for 15 consecutive years, and it also offers two series of compelling preferred shares. The company plans to continue on its path of acquisitive growth and has a pipeline of $260 million for the year 2020. This article reviews the health of the business, valuation, risks, dividend safety, and concludes with our opinion about why the shares may be worth considering if you are an income-focused investor.
Top 10 Big-Dividend Energy Stocks (6% to 14% Yields)
There are two big reasons energy stocks are down, and they are both creating some very attractive big-dividend investment opportunities. First, new technologies (such as hydraulic fracturing) have increased supply, and brought energy prices sharply lower in the past half-decade. And second, the massive wave of so-called “sustainable” and “ESG” investors (ESG stands for Environmental, Social and Governance) have put truly massive selling pressure on “fossil fuel” stocks. However interestingly, as ultra-billionaire Bill Gates recently
New Options Trade: Battleground Retail REIT, Attractive Upfront Income
There’s usually at least some truth to every fear mongering media narrative, and the talking heads and short sellers have not been kind to retail REITs, as growing e-commerce continues to dramatically change the industry landscape. Yesterday we received news confirming that Simon Property Group (SPG) intends to acquire its smaller “A-Class” property REIT peer Taubman Centers (TCO), and shares of TCO shot up dramatically. There remains heightened uncertainty and volatility in this space, and it is making for an interesting, high-upfront-premium, income-generating options trade opportunity. We believe this is an attractive trade to place today, and potentially tomorrow as long as the share price doesn’t move too dramatically before then.
The Market Will Crash (Eventually): Are You Ready?
Risk Creep is when the market has performed very well for an extended period of time, and you start getting over confident and taking on too much risk that is not consistent with your investment goals. Since the depths of the financial crisis in early 2009, the market has not gone straight up, but it’s been pretty close, and it’s been powerful. This market will eventually come crashing down. Are you ready? Here’s what you can do to prepare…
Horizon BDC: 9% Yield, Paid Monthly, Attractive Growth and Income Combo
Many income-focused investors concentrate their nest eggs in the same subset of market sectors. Considering a few high-income investments in non-traditional high-income sectors can unlock tremendous value and opportunity. Horizon Technology Finance Corporation (HRZN) is a business development company, that pays a big monthly dividend, and offers an attractive combination of growth and value by focusing on development stage companies. In this report, we analyze the company’s income and growth profile, dividend prospects and finally conclude with whether the company’s stock offers an attractive balance between risks and rewards.
Enterprise Products Partners: Best In Class Midstream, Compelling 6.9% Yield, Still No K-1 to C-Corp
Enterprise Products Partners L.P. is an American oil and natural gas midstream service provider with its headquarters in Houston, Texas. In this report, we analyze the company’s business model, income, growth, distribution prospects and finally conclude with our opinion on whether EPD offers an attractive balance between risks and rewards.
Portfolio Rebalance: 3 Sales, 10 New Buys, Updated Tracker Tool
We don’t do it often, but we did on Friday. We’ve rebalanced our portfolio to bring the allocations back on target. And in the process, we’ve sold 3 positions and added 10 new ones. Again, we don’t do it often, and the 10 new buys are securities we’ve written about recently. This report details the rebalance, and we share our updated real-time Portfolio Tracker tool, including new risk monitoring and several new real-time watch lists for REITs, BDCs, Energy Stocks, and more big dividend opportunities.