Income investors, focused primarily on generating big steady income, can still enjoy some price appreciation too. And now that interest rate volatility is decreasing, attractive high-income opportunities are increasingly emerging. In this report, we first share and discuss comparative data on over 100 big-yield closed-end funds (“CEFs”) and over 40 big-yield business development companies (“BDCs”), and then rank our top 10 favorites (with yields ranging from 6.0% to over 12.0%), starting with #10 and counting down to our very top ideas.
New Purchase: Disciplined Growth Portfolio Update
This is a quick note to let readers know we’ve added a new position to the Disciplined Growth Portfolio (it’s a business benefiting from two big secular trends: (1) The Great Cloud Migration and AI, and (2) Increasing Technology in the Automotive Industry). And we have also updated the Disciplined Growth Portfolio Tracker Sheet for July (there have been a few rebalances).
*New Trade: Sold Owl Rock (Now Blue Owl), Purchased This BDC Instead, 11.2% Yield
This is a quick note to let readers know we have placed a new trade in our Blue Harbinger High Income NOW and Income Equity portfolios. Specifically, we have sold 100% of our position in Owl Rock Capital (ORCC) (recently renamed Blue Owl, (OBDC)) and replaced it with this (see below) highly attractive 11.2% yield BDC instead. We’ll be updating our portfolio tracker sheets shortly, but wanted to share this information with readers right away.
Wide Moat Semiconductor Company: Two Massive Secular Trends
The non-mega-cap semiconductor company we review in this report is growing rapidly as it benefits from two massive secular trends: (1) the cloud (and artificial intelligence), and (2) dramatically increasing technology in the automotive industry (i.e. its chips have increasing applications in new cars). Also, this wide-moat founder-led company has impressive profit margins (important in the current macro environment), and generates tons of cash (for increasing dividends and share repurchases). If you are looking for an attractive “offense-and-defense” investment opportunity, these shares are worth considering.
50 Top Growth Stocks: These 3 Worth Considering
Market fear has ticked up slightly over the last week as interest rate hikes are expected to resume and this could pour water on the red hot stock market rally so far this year, especially high-growth stocks. However, it’s our contention that this short-term noise won’t matter for select top growth stocks which will be driven higher by strong execution supported by incredible disruptive secular trends (including generative AI, the great cloud migration and the world’s insatiable desire for more efficient sources of energy). In this report, we share high-level data on the current state of the market, company-specific fundamental metrics on over 50 top growth stocks, and then review three specific stocks from the list that represent particular compelling businesses going forward.
Big-Yield BDC: Why This 11.2% Yielder May Be Set For Gains Ahead
Business Development Companies (BDCs) are another income-investor favorite thanks to their very large dividends and potential for price gains. In this report, we review an attractive BDC that has positioned itself for solid performance ahead (i.e. potential dividend and price increases). We review the business, the market, the dividend safety, valuation and risks, and then conclude with our opinion on investing.
7 Big-Yield CEF Questions (I Always Ask Myself) To Drive Healthy Income
NMZ: 50 Big-Yield Municipal Bond CEFs, Historically Large Price Discounts
Big Yield Bond CEFs: Is It Safe To Invest? (Interest Rate Risk)
Income-focused investors love big-yield bond CEFs because of their large distributions payments, often paid monthly. But if you’ve been following along, you know most of them (i.e. the popular PIMCO and BlackRock bond CEFs) have been feeling a lot of pain over the last year (because as rates have gone up, bond prices have gone down). Granted some investors don’t care about price as long as the income keeps rolling in, but it really does matter. In this report, we provide an update on three popular Bond CEFs (two from PIMCO and one from BlackRock), and share our views on whether the interest rate environment is signaling an “all clear” sign. We conclude with our strong opinion on investing.
Top 10 Growth Stocks (July 2023)
Following an ugly 2022, the market has been strong so far this year (the S&P 500 is up 15%), but the recovery has not been spread equally among all stocks. In this report, we focus on powerful growth stocks, sharing data that makes a compelling case for more gains ahead for certain names in particular. After sharing stock-specific data, we consider current macroeconomic conditions, a few massively-disruptive secular trends, and then count down our top 10 growth stock rankings. We believe the names on the list have massive upside potential in the quarters and years ahead.
4 Ingredients To “Beat The Market” Consistently (And How I Track My Success On A Daily Basis)
Lithium Producer: 40 Top Stocks, These 4 Worth Considering
There are many ways to identify top investment opportunities, and one strategy is to screen the universe based on important fundamental metrics and then dig deeper into the names that look attractive. In this report, we share data on 40+ high-profit-margin and high-sales-growth stocks, and then dig deeper into four that are particularly attractive. We have a special focus on a new lithium producer, including a review of its business, its growth potential, its valuation and risks. We conclude with our strong opinion about investing in high-profit-margin and high-sales-growth stocks in the current challenging macroeconomic environment.
This AI-ML Stock: Massive Sticky Secular Growth
The company we review in this report is already benefiting from the massive secular growth in Artificial Intelligence (“AI”) and Machine Learning (“ML”). And it is positioned to keep benefiting massively in the years ahead thanks to its leading solutions, innovation, sticky customer base and very strong balance sheet. This one was loved (during the pandemic bubble) then hated (when the bubble burst), but the business has only been getting stronger and the shares are still inexpensive relative to where we expect them to be in five years and beyond. In this report, we review the business, the growth, the opportunity, the valuation and the risks. We are currently long these shares with no intention of selling.
Is Verizon 7.2% Dividend Yield Worth the Cost?
Verizon’s 7.2% dividend yield is increasingly tempting to many income-focused investors. However, many of those same investors are reminded of AT&T—another telecom that was recently forced to cut its big dividend as the payout got way ahead of the company’s cash flows. In this report, we review Verizon’s business, dividend safety, valuation and risks (including the new Amazon Prime threat), and then conclude with our opinion on investing.
Top Dividend Dogs of the Dow: This Healthcare Stock is Attractive
“Dogs of the Dow” is an investment strategy that essentially involves investing in the 10 Dow Jones stocks with the highest dividend yields. In this report, we review the strategy and then dive into one name from the list that is particularly attractive. Specifically, we review a healthcare sector Dog of the Dow with a compelling 3.8% dividend yield and a low stock price as compared to its value. We conclude with our opinion on investing.
Snowflake (SNOW) Quick Note
In this quick note, we provide some brief updated data and valuation metrics for Snowflake (SNOW), as well as our thoughts on the market opportunity, health of the business and risks. This one was so popular when it IPO’d during the pandemic bubble in late 2020, and the shares have now fallen so hard.
USA: Top 20 Big-Yield CEFs, Discount-Premium Edition
The Liberty All-Star Equity Fund (USA) is a popular big-yield closed-end fund (“CEF”). It offers an annual distribution yield equal to 10% of its net asset value (“NAV”) with 2.5% paid quarterly. And it currently trades at a discount to its NAV (it previously traded at a large premium). In this report, we review USA in detail, and then compare it to 20 other popular big-yield CEFs from varying categories (including some important guidelines on when it might be okay to purchase a CEF at a premium to NAV and when it might not be). We conclude with our strong opinion about investing in USA and a few other CEFs in particular, especially considering their current price premium-versus-discount dynamics.
Disciplined Growth Portfolio Updated
Cloud Monitoring & Analytics: Massive, Out-of-Favor, Sticky Revenue Growth
The company we review in this report provides a cloud-based data monitoring platform. The shares are out of favor (~50% below all-time highs) but revenue continues to grow rapidly, it is very sticky (land and expand) and this highly-ranked industry leader is supported by a massive secular trend (digitization and cloud migration). In this report, we analyze the company’s business model, its market opportunity, financials, valuation, risks, and then finally conclude with our strong opinion on whether the shares are worth considering for investment.
DNP Select Income Fund: 7.6% Yield, 23.2% Premium to NAV
The DNP Select Income Fund (DNP) is an income investor favorite, offering a steady monthly distribution (current yield: 7.6%) by investing in utility sector stocks and investment grade bonds (both known for safety and stability). However, the shares currently trade at a large 23.2% premium to the fund’s net asset value (“NAV”). In this report, we review the strategy, the leverage, the distribution, the distribution reinvestment plan and the performance. We conclude with our opinion on whether this fund is worth considering for investment, or not.