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3 “Strong buy” share with more than 9% dividend yield
Markets ended 2020 on a high note and 2021 started on a bullish path. All three major indices have recently risen to an all-time high as investors seem to have looked beyond the pandemic and hoped for signs of a quick recovery. Veteran strategist Edward Yardeni sees the economic recovery as its own slowdown. As the COVID vaccination program enables further economic opening, with more people returning to work, Yardeni predicts a wave of pent-up demand, rising wages and rising prices – in short, a recipe for inflation. “In the second half of the year, we may be on the lookout for a consumer price inflation that will not be good for assets that are too high,” Yardeni said. Warning signs are higher returns in the market for the treasury bonds. If the Fed eases the low-rate policy, Yardeni sees the treasury first reflecting the change. A situation like this is tailored for defensive stocks – and it will, of course, lead investors to look at high-yield dividend stocks. With the opening of the TipRanks database, we found three stocks with a trio of positive signs: a strong buy rating, dividend yields starting at 9% or better – and a recent analyst analysis indicating the upward double-digit figure . CTO) We start with CTO Realty Growth, a real estate firm in Florida, that made an exciting decision for dividend investors last year: the company announced that it would change its tax status to that of a fixed investment trust (REIT) for the tax year ending 31 December 2020. REITs have long been known for their high dividend yields, a product of tax code requirements that these companies must return a high percentage of their profits directly to shareholders. Dividends are the normal way to get that return. CTO has a varied portfolio of fixed investments. The property contains 27 income properties in 11 states, totaling more than 2.4 million square feet, along with 18 rental billboards in Florida. The income properties are mainly shopping malls and stores. During the third quarter, the most recent report, CTO sold about 3,300 acres of undeveloped land for $ 46 million, acquired two income properties for $ 47.9 million, and collected ~ 93% of the contractual base lease. The company also approved a one-time special distribution in connection with its move to REIT status; its purpose was to bring the company into line with the income tax regulation in the 2020 tax year. The one-time distribution was done in cash and stock and amounts to $ 11.83 per share. The ordinary dividend paid in the third quarter was 40 cents per ordinary share. It was raised to $ 1 in Q4, a jump of 150%; once again, this was done to meet the company’s REIT status requirements. At the current dividend rate, the return is 9.5%, much higher than the average among peer companies in the financial sector. Analyst Craig Kucera, of B. Riley, believes that CTO has many options going forward to expand its portfolio through its acquisition: ‘CTO reaches the highest point of the expected lead at $ 33 million in 4Q20, which bringing in nearly $ 85 million, with the largest mindset associated with exercising a tenant’s option to purchase a CTO building in Aspen, CO. estimates> $ 30 million in cash and limited cash for additional acquisitions, and we expect CTO to be active again in 1H21. Kucera rates CTO a buy with a price target of $ 67. At current levels, its target implies an upward potential of 60% for one year. (Click here to see Kucera’s record.) Overall, CTO has 3 reviews from Wall Street analysts, and they all agree that this stock is a buy, which makes the analyst’s unanimity unanimous. The stock costs $ 41.85, and their average price target of $ 59.33 indicates room for ~ 42% growth in the coming year. (See CTO stock analysis on TipRanks) Holly Energy Partners (HEP) The energy sector, with its high cash flow, is also known for its highly paid dividend stocks. Holly Energy Partners is a midstream carrier in the sector and provides pipeline, terminal and storage services to producers of crude oil and petroleum distillate products. Holly bases most of its operations in the Colorado-Utah and New Mexico-Texas-Oklahoma regions. In 2019, the last full year for which numbers are available, the company generated total revenue of $ 533 million. The company’s revenue in 2020 decreased in the first and second quarters, but recovered in the third quarter and was $ 127.7 million. Holly reported $ 76.9 million against the distributable cash flow – from which dividends are paid – to more than $ 8 million on an annual basis. It supports a 35-cent dividend payment per ordinary share, or $ 1.40 on an annual basis. At that rate, the dividend yields a strong 10%. Michael Blum, analyst at Well Fargo, noted that the dividend said: ‘Our model suggests that the distribution at this level is sustainable, [lost revenue] is compensated by inflation escalators in HEP’s pipeline contracts and contributions from the Cushing Connect JV project. About 80% of the HEP benefit is tax-deferred. Blum gives HEP a price target of $ 20 and an excessive (ie buy) rating. Its target implies a 38% lead for the next 12 months. (To view here, click here.) As shown by the Strong Buy Analyst Consensus Review. The rating is supported by 6 reviews, ranging from 5 to 1 Buys versus Hold. The average price target, at $ 18.67, indicates that the stock has room to grow ~ 29% this year. (See HEP stock analysis on TipRanks) DHT Holdings (DHT) Midstreaming is only one part of the global oil industry’s transportation network, tankers are another, transporting crude oil, petroleum products and liquefied natural gas around the world in large quantities. operates a fleet of 27 crude oil tankers, all rated VLCC (very large crude carrier). These vessels are 100% owned by the company and range in tonnage from 298K to 320K. VLCCs are the workhorses of the global oil tanker network. four quarters of consecutive revenue gains s, even by the ‘corona half’ of 1H20, DHT has a consecutive decline in revenue from 2Q20 to 3Q20. The top line in that quarter dropped from $ 245 million to $ 142 million. However, it is important to note that the 3Q revenue result continued to increase by 36.5% year-on-year. The EPS, with 32 cents, was a dramatic reversal of the 6 cent loss in 3K19.DHT has the history to adjust its dividend, if necessary, to keep it in line with earnings. The company did so in the third quarter and the 20 percent per ordinary share payment was the first dividend cut in five quarters. However, the general policy is positive for dividend investors, as the company has not missed a dividend payment in 43 consecutive quarters – an admirable record. At 80 cents a share on an annual basis, the dividend yields an impressive 14%. Petter Haugen, analyst at Kepler, covers DHT and he sees potential for increased returns in the company’s contract schedule. Haugen noted: “With 8 out of 16 ships terminating their TC contracts by the end of Q1 2021, we believe DHT is well positioned as we expect to appreciate the freight rates in H2 2021E.” In more detail, Haugen adds, “[The] the main underlying drivers are still intact: fleet growth will be low (averaging 1% over 2020-23E) and the US will continue to be a net exporter of crude oil to the sea, delivering further export growth due to US demand to tankers. We expect spot rates to improve again during 2021E, shortly after demand for oil normalized. We expect average VLCC rates to be USD 41,000 / day in 2022E and USD55,000 / day in 2023E. In line with his comments, Haugen rated DHT a Buy. Its $ 7.40 target indicates that this stock may grow by 34% in the coming months. (To see Haugen’s record, click here. The rest of the street climbs aboard. 3 buys and 1 property allotted in the past three months yield a consensus of strong analysts. In addition, the average price target of $ 6.13 the potential at ~ 11%. (See DHT stock analysis on TipRanks) Visit TipRanks ‘best-selling stocks, a newly launched tool that combines all of TipRanks’ equity insights, to find great ideas for trading dividend shares at attractive valuations.only those of the analysts listed here.The content is for informational purposes only.It is very important to do your own analysis before investing.