Electro Rent Corporation: A Defense Play To Diversify A High-Yield Dividend Portfolio

For income investors looking to formulate a high-yield dividend portfolio, one of the most difficult challenges in execution often comes in identifying investments which can further diversify against the risk of sector concentration. As it stands, the majority of investments that offer a high dividend yield are often found in real estate, energy infrastructure, finance, and utilities. One such company which may be suitable in providing uncommon exposure to defense spending is a small company called Electro Rent Corporation (ELRC).Electro Rent Corporation operates as a leading company in the rental, leasing, and sales of electronic test equipment, personal computers, and servers. The company has a global reach and specializes primarily with customers found in the aerospace, defense, telecommunications, electronics, and semiconductor industries. The company engages primarily in the short-term rental, lease, and sale of state-of-the-art electronic equipment composed primarily from manufacturers such as Keysight Technologies, Anritsu, Rohde & Schwarz Gmbh & Co., and Tektronix.For investors, one of the most attractive features of the company is its lucrative dividend yield. For 2014, the company's quarterly dividend rates was $0.20 per share. This results in an annual rate of $0.80, and an annual dividend yield of approximately 7.6% based on the last share price of $10.51. Since 2007, this rate has increased approximately 100% from the former quarterly rate of $0.10 per share.... Read more

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