Posts Tagged ‘Insights’
Avoid the Dividend capture strategy…
It isn’t as easy as it sounds. If you are not familiar how it works, you buy a stock right before the ex-dividend date to capture the dividend, then sell it right after. Sounds like a quick win, right? But here’s the kicker: stock prices tend to drop by the dividend amount on the ex-dividend…
Read MoreREFI: A Cannabis Market Outlier
Most stocks that are in cannabis are struggling yet REFI is knocking it out of the park and Wall Street loves it! This is an example how a performing dividend yield company can weather the storms even if an entire sector is being beaten down. See the article on Yahoo Delivering Returns As The…
Read MoreThe Emperor was named Penguin, not to be confused with an actual penguin
Did the headline catch you? Good. When it comes to dividend income stocks, earnings are like the Emperor—don’t mistake them for just any old penguin. In the financial world, “income” or “revenue” is akin to all the penguins waddling around—the money that flows into the company from various sources like sales or services. However, just…
Read MoreDividend Stocks as a Hot Play
With the Federal Reserve’s interest rate decision approaching in September, more investors are eyeing dividend stocks. Experts believe that dividend stocks could be a strong play into the fall, providing a stable income stream amid market uncertainties. Paul Baiocchi of SS&C ALPS Advisors supports this strategy, noting a shift from money markets and fixed…
Read MoreDividend Growth vs. High Yield: Which Strategy Wins?
When it comes to dividend investing, the debate today is usually between Dividend Growth and High Yield strategies which often sparks discussion among seasoned investors. Dividend Growth focuses on companies that gradually increase their payouts over time, but these increases usually start from a relatively low base. In contrast, High Yield strategies target companies offering…
Read MoreTax implications of dividends from Regulated Investment Companies (RICs)
Understanding the tax implications of dividends from Regulated Investment Companies (RICs), such as Real Estate Investment Trusts (REITs) and Business Development Companies (BDCs), is crucial for investors, particularly because these dividends are typically classified as non-qualified. Unlike qualified dividends, which benefit from lower long-term capital gains tax rates, non-qualified dividends are taxed as ordinary income,…
Read MoreEffects of Leverage on Dividend Stability in Income-Paying Companies
Leverage has a significant impact on the dividend stability of Regulated Investment Companies (RICs), such as Real Estate Investment Trusts (REITs) and Business Development Companies (BDCs), which are required by law to distribute at least 90% of their taxable income as dividends to shareholders. This obligation creates both opportunities and challenges in maintaining dividend stability,…
Read MoreInterest Rate Sensitivity Affects High-Yield Dividend Securities
Interest rate sensitivity significantly impacts the performance of high-yield dividend securities, including Real Estate Investment Trusts (REITs) and Business Development Companies (BDCs). When interest rates rise, these companies often face increased borrowing costs, which can reduce their profitability and ability to maintain dividend payouts. As a result, investors might shift their focus to bonds and…
Read MoreImpact of Asset Quality on Dividend-Paying Entities
In the context of REITs and BDCs, high-quality assets are those that consistently generate stable cash flow, have a low risk of vacancy or default, and are located in prime, economically resilient areas. The quality of these underlying assets directly influences the entity’s ability to generate consistent income, which is the foundation of stable dividend…
Read MoreThe Importance of Cash Flow Analysis in Dividend-Paying Investment Structures
Cash flow analysis is a critical component in evaluating dividend-paying investment structures, as it provides insights into a company’s ability to sustain and grow its dividend payments over time. For investors focused on income generation, understanding the cash flow of a company is essential, as dividends are paid out of cash flows, not earnings. A…
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