As we head towards 2024, the market continues to present widely varied and dynamic investments opportunities, particularly in the growth stock space. Importantly, the macroeconomic backdrop is shifting from ultra-hawkish (i.e. the fed was aggressively hiking rates—to fight the high inflation it helped create by pumping easy money into the economy during the pandemic) to more dovish (as inflation slows and fed-funds futures now predict interest rate cuts in 2024). Without question, monetary and fiscal policies have their thumb on the scales of market performance, but not all stocks are created equally. In this report, we countdown our top 10 growth stocks for 2024, starting with #10 and finishing with our very top ideas.
Ares Capital: 40 Big-Yield BDCs, Compared
In this report, we compare 40+ big-yield BDCs, including a special focus on industry stalwart, Ares Capital (ARCC). Specifically, we rank the BDCs based on various metrics, including price-to-book value, dividend yield and a variety of other factors. We then dive into the specifics on Ares, including a discussion of how it is fortifying its financials for a potential macroeconomic storm. We conclude with our strong opinion about investing in BDCs at this point in the market cycle, and our specific views on investing in Ares Capital, in particular.
Top 10 Big Yields: CEFs, BDCs, REITs & More
As 2024 begins, it is a fantastic time to be a big-yield investor. With the Fed’s interest rate hikes seemingly over (and potentially even about to reverse), and with so many big-yield opportunities that have become “too” out of favor, income-focused contrarians are salivating. In this report, we countdown our top 10 big-yield opportunities, including closed-end funds (“CEFs”), business development companies (“BDCs”), real estate investment trusts (“REITs”), dividend stocks and more. We also share data on hundreds of big-yield opportunities from across each of these categories (so you can compare and contrast for yourself).
REIT CEF: Big-Yield, Big Discount, Contrarian Opportunity
If you are an income-focused investor, you may have noticed that popular high-dividend REITs have struggled this year. Specifically, rising interest rates and secular changes to the real estate market have kept REIT prices low (while other market sectors, such as technology, have posted strong gains). In this report, we review a blue-chip REIT closed-end fund (“CEF”) that offers a large distribution yield (currently 8.1%) and trades at a significant discount to net asset value (“NAV”). After reviewing the strategy, distribution characteristics, leverage, price and risks, we conclude with our opinion on investing.
Next Gen AI Data Center: Massive Disruptive Upside
The data center company we review in this report is the epitome of a high-risk / high-reward opportunity, and the odds appear tilted strongly towards high reward (based on the massive secular opportunities: mainly explosive growth in Artificial Intelligence, and to a lesser extent blockchain hosting). This isn’t the type of stock you bet the farm on, but it’s absolutely worth considering for an allocation within a prudently concentrated high-growth portfolio. In this report, we review the business, the opportunities, valuation and risks, and then conclude with an important takeaway.
Muni Bond CEFs: Big-Yields, Historic Discounts to NAV
If you don’t like paying taxes, like most of us, you may have noticed that municipal bond closed-end funds are still trading at historically large (and very unusual—attractive!) discounts to NAV. The “magic” of a municipal bond, is that you generally don’t have to pay federal income tax on the income—so if you’re in a high tax bracket—munis can be quite lucrative (especially on a “tax-equivalent” yield basis). In this report, we share data on over 75 big-yield municipal bond CEFs, discuss the current historical opportunity (including how funds are actively working to reduce the discounts!), and then share a few thoughts on particular muni-bond CEFs that you may want to consider for investment.
British American Tobacco: Despite Big Risks And Impairment, Big Dividend Is Attractive
The already inexpensive British American Tobacco (BTI) just got more inexpensive following Wednesday’s announced $31.5 billion write down (mainly related to its U.S. cigarette brands). The shares fell sharply on the news (because it adds to the multiple big risks the company already faces). However, this big non-cash impairment doesn’t impact the company’s cash position and it won’t impact future capital allocation decisions (including the monster big dividend, currently yielding nearly 10%). In this report, we review the business, the details of the impairment charge, the company’s valuation and the big risks. We conclude with our strong opinion on investing.
Top 10 Big-Yields: CEFs, BDCs, REITs and More (Updated)
This report ranks our top 10 big-yield investments, including CEFs, BDCs, REITs, dividend stocks and more. We also share data on hundreds of big-yield opportunities from across each of these categories. After counting down our top 10 ideas, we conclude with all the details on how each of the top ideas fits into our prudently concentrated High Income NOW portfolio (current yield 10.1%, 28 total positions).
Big EV Upside for this Tiny Specialty Chemicals Company
As inflation slows, the fed gets less hawkish and the market builds momentum heading into 2024, the shares of some high growth stocks remain depressed despite the fact that business is accelerating rapidly. The specialty chemicals company we review in this report has a healthy “energy industrials” business (servicing oil producers, refiners and the like), but it is the company’s tie in to electric vehicles (thermal barriers used in battery packs) that make the disruptive upside potential most compelling (for example, the shares have nearly 90% upside compared to the consensus Wall Street price target, and they’re rated “strong buy”). In this report, we review the business, the growth potential, the valuation and the risks, and then conclude with our strong opinion on investing.