1 Special Dividend Opportunity

Vodafone currently offers a 4.7% yield, a solid dividend from a telecom blue chip. But it looks as if there's plenty of room for upside on that dividend, which should drive the stock higher. The company pays out 55% of its free cash flow but just 39% of its net income. But in this case net income better measures the company's profitability. Vodafone consolidates income from its 45% stake in Verizon Wireless but doesn't actually receive cash from the joint venture with Verizon (NYSE: VZ ) . That could be about to change. Verizon Wireless has nearly paid down its debt, meaning the JV can pay out dividends to its co-owners. Many have speculated that Verizon needs the cash for the build-out of operations in the U.S. and therefore would have the venture turn on the dividend spigot. It's this potential that has hedge fund investor David Einhorn intrigued. Einhorn is also interested in Sprint Nextel (NYSE: S ) and actually purchased nearly 2% of its shares late last year.... Read more