Four More High-Yielders Going Ex-Dividend in December
Karin is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Please note: This is part two of a three-part series.
Many investors have turned to dividend-paying companies during this time of economic uncertainty. The added incentive of a reliable income stream makes an already-attractive stock almost irresistible. I have been analyzing hundreds of dividend-payers over the past few months, narrowing out those that I think should be considered by dividend investors.
Hopefully some of them will be new, ones that have not come to your attention in the past.
Today's list is not meant to form the foundation of your portfolio. These are not the Dividend Champions that have been paying reliably for years. However, if you have your foundation in place, these should be considered as higher-risk, but commensurately higher-reward, options.
Every month I examine the companies that will be paying out dividends, and narrow down the list to the few gems that I think are worth a further look. This month I examined over 300 stocks that are going ex-dividend in December, and found nine stocks that are yielding between 7% and 10% and that have total returns of more than 20% in the past twelve months. Four are outlined here, and five more can be found in this article.
I also found five companies that are yielding more than 10%, which you can find in this article.
In order of yield, highest to lowest:
Gladstone Commercial (NASDAQ: GOOD) is a real estate investment trust which was incorporated for the purpose of investing in and owning net leased industrial and commercial real property and selectively making long-term industrial and commercial mortgage loans.
Gladstone Commercial is currently trading at $18 per share and yields 8.5%. It is trading at 10% less than its 52-week high, and the company has returned 26.9% over the past twelve months.
In terms of the Motley Fool community, GOOD is a three-star CAPS pick, with 35 Bulls and 9 Bears. Professional analysts rate the company a 2.0 with 1 Strong Buy and 1 Buy.
Gladstone Commercial has been paying a 12.5 cent per share dividend monthly since January 2008, for 60 consecutive months. This means the dividend made it safely through the fiscal crisis of 2008-2009. FFO (a REIT-relevant accounting term broadly meaning net income) for the 3rd quarter of 2012 is down slightly from 2011, but still sufficient to cover the distribution.
It goes ex-dividend on December 17 and will pay a dividend of $0.125 on December 28. This company pays dividends monthly.
Starwood Property Trust (NYSE: STWD) is engaged in the originating, investing, financing, and managing of commercial mortgage loans and other commercial real estate debt investments and commercial mortgage-backed securities
STWD is currently trading at $23 per share and yields 7.9%. It is trading at its 52-week high, and the company has returned 40.1% over the past twelve months.
In terms of the Motley Fool community, STWD is a three-star CAPS pick, with 61 Bulls and 5 Bears. Professional analysts rate the company a 1.6 with 4 Strong Buys, 3 Buys and 1 Hold.
Starwood has been paying and raising distributions consistently since Q4 2009. The company aggressively raised distributions through 2010, from 10 cents per share to 40 cents per share. The distribution has been fixed at 44 cents per share for 7 quarters. Net income for the first three quarters of 2012 exceeded 2011 by 43%.
It goes ex-dividend on December 27 and will pay a dividend of $0.44 on January 15, along with a special “true up” dividend for which the amount has not yet been disclosed, but which is expected to be in the neighborhood of an additional 10 to 15 cents.
PDL BioPharma (NASDAQ: PDLI) is a biopharmaceutical company focused on discovering, developing, and commercializing innovative therapies for severe or life-threatening illnesses
PDLI is currently trading at $7.50 per share and yields 7.9%. It is trading at its 52-week high, and the company has returned 39.1% over the past twelve months.
In terms of the Motley Fool community, PDLI is a three-star CAPS pick, with 862 Bulls and 50 Bears. Professional analysts rate the company a 3.0 with 5 Holds.
PDL has consistently paid a dividend of 15 cents per share for 8 quarters, since the 1st Quarter of 2011. Its payout ratio is a very sustainable 48%. Net income for the first nine months of 2012 is up 23% versus 2011.
It goes ex-dividend on December 5 and will pay a dividend of $0.15 on December 14.
Preferred Apartments Communities (NYSEMKT: APTS) is a REIT that invests in apartment buildings in the United States.
APTS is currently trading at $8 per share and yields 7.3%. It is trading at 12% less than its 52-week high, and the trust has returned 43.2% over the past twelve months.
Preferred Apartments is not ranked by the Motley Fool CAPS community. Professional analysts rate the company a 1.0 with 1 Buy.
The company has recorded a net loss in every quarter since its inception, but the net loss has improved from $0.81 cents per share in 2Q 2011 to -$.0.03 cents per share in 3Q 2012. The company provided guidance that its 4th Quarter results would be similar to 3Q, but has provided no guidance beyond that.
Preferred Apartments has increased its quarterly dividend three times since it began paying in the 2nd Quarter of 2011, from 12.5 cents per share to its current rate of 14.5 cents per share. The one-year Dividend Growth Rate is 16.0%.
It goes ex-dividend on December 27 and will pay a dividend of $0.145 on January 15.
To sum it up, I believe all of these companies can add a boost of yield to a stable dividend-paying portfolio. They are all terrific companies, have proven themselves over the past twelve months, and pay far-higher-than-average yields. Add a couple of them to make sure your portfolio is throwing off more than the measly 2% you can get from the S&P 500 these days.
khern0203 has no positions in the stocks mentioned above. The Motley Fool owns shares of PDL BioPharma. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!