Ken Heebner’s 3% Yield and Higher Picks Include Herbalife (HLF)

Similarly, the fund reported a position of 1.3 million shares in Camden Property Trust (NYSE:CPT), which also owns and manages apartment buildings in the United States. The two real estate investment trusts are almost identical in terms of market capitalization, considering Camden’s valuation of $5.8 billion, and see little difference in terms of dividend yields as well: Camden pays a yield of 3.6%. We would note that each company recently increased its dividend with the first new payment going out in March.

Capital Growth Management was buying Sovran Self Storage Inc (NYSE:SSS), a real estate investment trust providing storage space for residential and commercial customers, and reported owning 1.2 million shares in the 13F. The stock has risen 28% in the last year and now carries a market capitalization of $1.9 billion. Sovran also recently boosted its quarterly dividend payment to a level which implies an annual yield of 3% at current prices.

The real estate investment trusts look somewhat interesting, but income investors should be sure that they do not have too much of their portfolio allocated to REITs (since some REITs pay much higher yields, Camden and others would essentially be competing for a place in a portfolio) or to residential exposed investments. We are interested in autos, though mostly in value terms, and would be interested in comparing Ford to its peers and to auto parts companies, some of whom are quite cheap. Herbalife looks good at first glance but given its battleground nature we would hesitate to take anything larger than a small position even if we were able to satisfy our concerns about the future of its business.

Disclosure: I own no shares of any stocks mentioned in this article.