6 Dividend Stocks – $SBGI, $TSU, $NYX, $UVV, $AYR, $STX

When you buy a dividend stock, you have two ways to earn money – from the stock’s performance and from the dividends the stock yields. There is a catch though – you have to decide how you want to receive your dividends when you purchase the stock. Keep in mind that which ever method you use is taxable. If you receive your dividends as income, you can pay the taxes on that sum from the dividends themselves, but if you reinvest your dividends, you will have to pay taxes on the dividends you receive when they are disbursed, which could be a hefty amount out of pocket.

RENAISSANCE TECHNOLOGIES

DIVIDENDS AS INCOME

The dividend amount will vary dramatically between companies but, in any case, if you invest enough, you could use your dividends to replace or supplement your income. Now, with this strategy comes certain risks – after all, the company could stop providing dividends at any time, or change the dividend amount.

DIVIDENDS AS RETURN

On the other hand, you could choose to reinvest the dividends. Reinvesting takes advantage of compounding interest to net you even greater returns. It also acts as type of hedging – if the stock performs poorly, the reinvested dividends can offset loss. Between the benefits of reinvesting (it’s like “free money”) and the hedging ability of reinvesting dividends, if you can afford to pay the tax bill, reinvesting can be extremely profitable, especially if the dividend yielding stock is a strong and consistent performer.

CHOOSING THE RIGHT DIVIDEND STOCKS

Choosing the right dividend stock is important. Whether you want to use the dividends as income or reinvest them, finding a stock that will consistently perform well while offering consistent dividends is critical to managing your investment portfolio – whatever your purpose. For example, a stock like the Coca-Cola Company has been consistently providing dividends, and consistently increasing them, for the last few decades.

To give you an idea what to look for, we compiled a list of stocks with dividend yields over 4% of their respective stock prices. Then, we narrowed the list to look only at those stocks that pay out less than 50% of their profits as dividends (“payout ratio”). This was done to help control the quality of the list. Next, we looked at the number of stocks that had the highest number of institutional purchases in the current quarter.

Here is a list of the stocks we came up with. You can use as a starting point for your own analysis:

  • Sinclair Broadcast Group (SBGI) is a company that provides programming, operating and sales services to television stations in the US had a dividend yield of 5.17% and a payout ratio of 46.76%. It also has 2.1M in institutional purchases, which is over 4% of the company’s 50.81M float. Amongst the 300+ hedge funds we track, 14 have positions in SBGI, including Jim Simons’ Renaissance Technologies.
  • TIM Participacoes (TSU) is a Brazilian mobile telecom company. It has a dividend yield of 5.12% and a payout ratio of 17.96%. TSU also has 13.3M in institutional purchases, which is almost 12% of the company’s 112.2M float. Amongst the 300+ hedge funds we track, 15 have positions in TSU, including Lee Hobson’s Highside Capital Management.
  • NYSE Euronext (NYX) a securities exchange company. It has a dividend yield of 4.48% and a 33.93% payout ratio. NYX also has 14.0M in institutional purchases, which is over 5% of the company’s 261.37M float. Amongst the 300+ hedge funds we track, 27 have positions in NYX, including John Paulson’s Paulson & Co.
  • Universal (UVV) is a tobacco leaf processor and merchant. It has a dividend yield of 4.48% and a payout ratio of 33.93%. UVV also has 1.5M in institutional purchases, which is almost 7% of the company’s 22.82M float. Amongst the 300+ hedge funds we track, 11 have positions in UVV, including David Dreman’s Dreman Value Management.
  • Aircastle Ltd (AYR) buys, leases and sells jets to passenger and cargo airlines worldwide. It has a 4.31% dividend yield and a payout ratio of 35.40%. AYR also has 2.0M in institutional purchases, which is over 3.5% of the company’s 56.02M float. Amongst the 300+ hedge funds we track, 14 have positions in AYR, including Michael Novogratz’s Fortress Investment Group.
  • Seagate Technology (STX) is a hard disk drive manufacturer. It has a dividend yield of 4.20% and a payout ratio of 30.28%. STX also has 26.7M in institutional purchases, which is almost 7% of the company’s 391.47M float. Amongst the 300+ hedge funds we track, 30 have positions in STX, including David Einhorn’s Greenlight Capital.
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

Qihoo 360 Technology Co Ltd (QIHU), Actavis plc (ACT), Yahoo! Inc. (YHOO) Among 20 Long Ideas from Sohn Canada

The 10 Laziest Countries in the World

The 10 Most Polluted Countries in the World

The 10 Most Dangerous Cities in America 2014

The Top 10 Gold Producing Countries in the World

The 10 Tallest Buildings in the World

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!