While the market was making new highs it was the right time for more growth oriented and Risk On positions. But in the past few days the market has pressed on the brakes.
First, because of noise out of China that they are not happy with the US meddling in its affairs in Hong Kong. And that they DEMAND that the US roll back existing tariffs to complete Phase 1. This means we may be further away from a deal than previously understood.
Second, the surprisingly weak ISM Manufacturing report on Monday morning splashed cold water on stock market bulls. This is the 3rd straight month with a reading under 50. Historically that type of contractionary result has not bode well for stock prices.
Add it all up and it might be a time for income stocks to take the lead for a while. So I got busy with a research project to uncover the best looking income stocks available. In the end 4 emerged head and shoulders above the rest.
Global Net Lease (GNL – Get Rating) is a REIT with a well above average 10.4% dividend yield. But here is what is most impressive. GNL has grown the dividend payment by more than 28% a year for the past 5 years. This is a great sign that GNL’s hearty dividend is here to stay and likely to be raised in the years ahead.
No dividend stock list is complete without an attractive pipeline firm in the mix. PBF Logistics (PBFX) perfectly fits that bill perfectly. PBFX sports a quite impressive 10.2% dividend yield and a, not-too-shabby, 10.5% annual increase.
Now let’s delve into the specifics of this stock search so you appreciate the full attractiveness of these top end income payers:
2,034 stocks with a POWR Ratings of A and B. Always need to start the party with our proprietary ratings model that finds stocks with the best momentum and timeliness. Typically the strength in price action is a reflection of positive fundamental catalysts at play.
74 of those stocks have 8% dividend yield or higher. So this single criteria quickly got rid of 96% of the potential candidates. And from there we narrowed down even further to those with 10% dividend yields.
17 of those stocks had grown dividend payments by greater than 5% per year for the past 5 years. And from there I whittled it down to the 4 with the most impressive rate of annual dividend increases.
The logic of all this final criteria should be readily apparent. That these stocks with increased dividends in the past are more likely to keep up that trend in the future. But also it is hard to pay more dividends if the company is not producing enough earnings and cash flow to make it happen. So this is an important health check on the operational strength of the firm.
OK…you get the idea. These are not just your ordinary high yield stocks. They have been specifically selected to also provide proof of operational strength, history of dividend increases, and ample momentum. See all 4 below.
|Company||Ticker||Market Cap ($mil)||Div Yield %||Annual Dividend Growth %|
|Global Net Lease||GNL||$1,824||10.45||28.85|
Want more great stock picks? Then check out these additional resources:
GNL shares rose $0.05 (+0.25%) in after-hours trading Monday. Year-to-date, GNL has gained 25.97%, versus a 26.44% rise in the benchmark S&P 500 index during the same period.
About the Author: Steve Reitmeister
Steve is better known to the StockNews audience as “Reity”. Not only is he the CEO of the firm, but he also shares his 40 years of investment experience in the Reitmeister Total Return portfolio. Learn more about Reity’s background, along with links to his most recent articles and stock picks. More…