rd80 (99.11)

Stuff the turkey with some yield

November 21, 2012 – Comments (1)

It was past time to do something other than bonds, so I ran a screen on a search for yield and found some. 

The screen was set up with a higher yield threshold (4%), higher PE limit (20) and no debt-to-equity constraints compared to settings I typically use.  I did limit results to 5-star rated companies, set the PE upper limit so earnings would cover the threshold yield with a bit of margin and required at least a little revenue and EPS growth.

The basic materials sector contributed 15 of the 35 hits.  12 of those were MLPs.  One more MLP, Teekay LNG Partners, made the cut, but it falls in the services sector.  Three business development companies and one REIT rounded out the hits from those three tax advanged structures.  I was surprised to see only one REIT make the screen; might be worth some more digging to see why.

Prospect Capital, a business development company, was the only company with a double digit yield to pass the screen.

The article adds a short profile on one company from each of the seven sectors represented in the results.

Screens are very useful, but the results should always be considered a starting point for further research, not outright buy or sell signals.

Hope everyone has a Happy Thanksgiving!

Fool on!  Russ