Alcoa's Dividend Is Safe

Here, we'll highlight a given company and its closest competitors to see just how safe their dividends are, with a little help from three crucial tools: The interest coverage ratio, or earnings before interest and taxes, divided by interest expense. The interest coverage ratio measures a company's ability to pay the interest on its debt. An interest coverage ratio less than 1.5 is questionable; a number less than 1 means that the company is not bringing in enough money to cover its interest expenses. The EPS payout ratio, or dividends per share divided by earnings per share. The EPS payout ratio measures the percentage of earnings that go toward paying the dividend. A ratio greater than 80% is worrisome. The FCF payout ratio, or dividends per share divided by free cash flow per... more

11 Incredible Dividend Stocks: Brookfield Infrastructure Partners

Investing in an infrastructure company sounds as about as exciting as, well ... as investing in an infrastructure company. Nothing deadens ebullient stock gossip among your friends quicker than a discussion of the safe haven nature of utilities or the natural hedge provided by timber assets. But for those who recognize the long-term dividend-paying value of such assets, Brookfield Infrastructure Partners L.P. (NYSE: BIP) is a great way to own some of the world's best hard assets. The businessBrookfield's hard assets are a model of stability. This publicly traded partnership owns stakes in a variety of infrastructure assets around the world, providing it diversification across business and geography. Assets such as ports, power transmission, timber, coal terminals, and railroads offer a... more

The Most Promising Dividends in Industrial Metals and Minerals

Yields and growth rates and payout ratios, oh my!Before we get to those companies, though, you should understand just why you'd want to own dividend payers. These stocks can contribute a huge chunk of growth to your portfolio in good times, and bolster it during market downturns. As my colleague Matt Koppenheffer has noted: "Between 2000 and 2009, the average dividend-adjusted return on stocks with market caps above $5 billion and a trailing yield of 2.5% or better was a whopping 114%. Compare that to a 19% drop for the S&P 500."... more

2 Railroad Dividends to Buy and 1 to Avoid

It should then come as no surprise to anyone why the railroad sector appears to be one of the best places to park your money while oil prices remain high. However, just because the sector is in great shape doesn't mean every stock within that sector is a buy. A quick scan of the railroad sector yielded a couple of outstanding dividend-paying companies that should be trusted to deliver phenomenal returns for shareholders, while one company has me shaking my head in disdain. Canadian National Railway (NYSE: CNI) -- trust itCanadian National Railway is a perfect example that just because a company is tackling a new 52-week high, that doesn't mean it can't continue heading higher.... more

The Biggest Dividend Boosters of the Past 10 Years

When you first look at a dividend-paying stock, the most readily available piece of information that's available to you is the stock's dividend yield. In contrast, it takes a lot more digging to find out what may well be far more important over the long haul: how much a company has increased its dividend over the years. Now and laterDividend yield is the most popular measure of a dividend-paying stock for several reasons. First and foremost, it's simple to calculate. Just divide the amount of the dividend payment by the current price of the stock, and you're done. There's no need to look up any historical figures, adjust for stock splits, or anything other complicated calculations.... more

Pitney Bowes' Dividend Is Safe

Here, we'll highlight a given company and its closest competitors to see just how safe their dividends are, with a little help from three crucial tools: The interest coverage ratio, or earnings before interest and taxes, divided by interest expense. The interest coverage ratio measures a company's ability to pay the interest on its debt. An interest coverage ratio less than 1.5 is questionable; a number less than one means that the company is not bringing in enough money to cover its interest expenses. The EPS payout ratio, or dividends per share divided by earnings per share. The EPS payout ratio measures the percentage of earnings that go toward paying the dividend. A ratio greater than 80% is worrisome. The FCF payout ratio, or dividends per share divided by free cash... more

11 Incredible Dividend Stocks: Autoliv

Autoliv (NYSE: ALV) is the predominant provider of automotive safety systems, spearheading virtually all major technological breakthroughs in the "occupant-restraint" industry over the past two decades. Let's take a closer look at this company. The businessAutoliv's products fall into two primary categories. Airbags and assemblies represent nearly two-thirds of sales, and seat belts and related equipment make up the other third.... more

More Dividends And Diversification

As a followup to Saturday's post I wanted to outline some ideas for building a dividend tranche for a portfolio where someone might have different buckets within a portfolio. So high yielders might be one bucket, themes another, core another and so on. I could see where it might be easier for some people to think of their portfolio this way. Although not my preference it is perfectly reasonable. Anyone going down this road might want to own high yielders from various parts of the market to capture some business diversification or maybe cyclical diversification. The following are just examples, I don't own any of them for clients. First is Brookfield Infrastructure Partners (BIP). This is sort of an investment product as opposed to a company. It manages a portfolio of infrastructure... more

4 Dividend Stocks Showing You the Money

Readers of the Income Investor newsletter can certainly appreciate that kind of thinking. Let's take a closer look at some of the companies that inched their payouts higher this past week. Let's start with FedEx (NYSE: FDX) . The speedy delivery giant is rushing a chunkier dividend to its shareholders. FedEx's new quarterly rate of $0.13 a share is an 8% improvement over its previous disbursement.... more

6 High-Yield Dividend Stocks for a Portfolio Boost

BP Prudhoe Bay Royalty Trust (BPT) BPT holds royalty interests in Alaska's Prudhoe Bay oil field. The area has approximately 150,000 productive acres. BPT continues to provide a steady stream of income via quarterly dividends. The fund is a U.S. Royalty Trust. U.S. Trusts are assumed to dissolve when assets are depleted. Investors should focus upon the oil production and the noted life span. Per BPT's 10K, "... the Trust will terminate: (i) on or before December 31, 2010 if holders of at least 70% of the outstanding Units vote to terminate the Trust, or (ii) after December 31, 2010 if either (a) holders of at least 60% of the outstanding Units vote to terminate the Trust or (b) the net revenues from the Royalty Interest for two successive years commencing after 2010 are less than... more