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Seven for Income

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February 14, 2011 – Comments (9)

In a continual quest for income, I tried a screen looking for stocks yielding more than the 10-year Treasury and trading below the average PE of the S&P500.

The biggest surprise is there were only seven that passed all the screen criteria.  I usually try to pick a best or best few from these screens, but there weren't any real standouts and the entire group looks like it could make a decent income portfolio.

As always, screen results are just a starting point for further research and should not be considered buy recommendations.

Happy Valentine's Day!

Russ

 

9 Comments – Post Your Own

#1) On February 14, 2011 at 8:50 PM, russiangambit (29.30) wrote:

Well, on the same quest over the past year I ended up with mostly foreign dividend paying companies - european blue chips and and canadian trusts and an emerging markets bond fund. I also have a couple of US reits but I am not sure how I feel about them.

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#2) On February 14, 2011 at 9:12 PM, ikkyu2 (99.15) wrote:

Your screener omitted MO and PM because their three year earnings history is contaminated by their split.

Full disclosure: I just went long both of them today!  Love those dividends.  (Hate the product, but that's another story, one I've done to death in my blog.)

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#3) On February 14, 2011 at 9:14 PM, ikkyu2 (99.15) wrote:

And, you know, interestingly, I ran the same darn screen today, except that I used 3.9 instead of 3.65 as the yield cutoff and looked at companies at all P/Es and D/Eq ratios.  I was looking for exactly the same thing you were, though.  Sometimes I feel like you are my evil investing twin.  Except maybe not evil. 

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#4) On February 14, 2011 at 9:59 PM, motleyanimal (81.46) wrote:

Leveraged closed-end muni funds will get you around 7.5%, plus the tax exemption.

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#5) On February 14, 2011 at 10:38 PM, rd80 (98.29) wrote:

 @russiangambit
I was surprised no non-US stocks turned up in this screen.  I didn't look to limit the results by geography, but after culling out a few that turned up that shouldn't have, there were only the seven.  

@ ikkyu2
I like to think I'm not evil, but ....  Hmm, if I'm not the evil one, that leaves you. :)

PM and MO strike me as great dividend investments.  I just checked and they missed the LT debt-to-equity parameter for this screen.  Even tho' I know a few shares don't make a difference in company policy, I can't bring myself to own a tobacco company.  Nothing against those who decide to own them, but it's one area of the market I've decided not to play. That said, if they made the cut on something I was doing for a TMF article, they'd be in there.

@motleyanimal
I'm really worried about munis.  I don't think we'll see a mass catastrophe like some are predicting, but I do think we'll see a big default or two or three before much longer.  Closed-end makes more sense to me than etf or indexes here; it makes sense to pay the extra management fee to get a manager who knows what they're doing to pick and choose.

Thanks to all for the comments.

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#6) On February 14, 2011 at 10:44 PM, russiangambit (29.30) wrote:

>I was surprised no non-US stocks turned up in this screen.  I didn't look to limit the results by geography, but after culling out a few that turned up that shouldn't have, there were only the seven

They probably didn't pass the EPS growth.

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#7) On February 15, 2011 at 2:07 AM, awallejr (81.55) wrote:

Don't forget the MLPS and BDCs. They may not pass your "screen" test because of their "nature" but nevertheless can be excellent longterm return investments.

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#8) On February 15, 2011 at 9:59 AM, lemoneater (78.14) wrote:

I just got some KMB this morning.

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#9) On February 21, 2011 at 3:57 AM, ikkyu2 (99.15) wrote:

Russ, you'll get no argument from me about choosing not to invest in tobacco.  I have serious qualms about it, but have managed to rationalize them away.

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