Adding International Dividends to Your Passive Income Portfolio

We have discussed passive income portfolios many times in the past few months and dividend investing is certainly a major part of what we consider to be a great way to add passive income. Every month, we take a look at the top dividend stocks from the S&P500 and then do a further analysis in our newsletter.We have also discussed the benefits of adding international exposure to investment portfolios and the various ways of doing that. One interesting idea is to add US listed stocks that pay foreign dividends. Why? Greater diversification in the actual payout: Companies that pay a foreign dividend generally have an important part of their business outside of the United States and because of that they will generally help you get a better risk/return for your portfolio No conversion... more

Screening Dividend Stocks for Risk and Growth

I've previously written several sector specific articles to adjust dividend yields for risk and growth (Previous articles include oil and gas, Dow Jones components). Risk is quantified through the hurdle rate, based upon the stock's beta. Both articles provide a more detailed review of the methodology. The purpose of this article was to see the result of screening a full list of stocks for all three factors: dividend yield, risk, and growth. Screening Using the screening tools from Zacks.com, I filtered 922 stocks that showed dividend yields, positive historical dividend growth, and positive long term earnings per share growth. The stocks ranged from the familiar, Exxon Mobil Corp. (XOM), to less well known stocks, including Aixtron SE (AIXG). The top 15 yielding dividend stocks (and... more

Yum! Brands: Good Dividend Growth, But With a Side Helping of Debt

Yum! Brands Inc. (NYSE: YUM) is the world’s largest quick service restaurant company, with more than 37,000 units in more than 110 countries and territories. YUM’s portfolio includes 5 brand concepts: KFC, Pizza Hut, Taco Bell, Long John Silver’s and A&W All-American Food Restaurants (A&W). Sales, Earnings, Free Cash Flow Yum! Brands has a similar business structure to McDonald's (MCD). The company owns and operates some restaurants, while independent franchisees own and operate the rest. This is a great business model, as it allows Yum! to attain predictable cash flow without much capital investment or operations management. Years Revenue (in millions) 2006 9,561 2007 10,435 2008 11,304 2009 10,836 2010 11,343 ... more

25 High Dividend Stocks Being Targeted By Short Sellers

We like high dividend stocks and consider them as alternatives to 10-year Treasury bonds. Like Jim Rogers and Ray Dalio, we are concerned about the Fed’s inflationary monetary policy and want to protect ourselves against inflation. One of the ways of doing this without assuming significant risks is investing in high dividend stocks. High dividend stocks are usually safer but under some circumstances they might be extremely dangerous. The vulnerable high dividend yielding companies may be targeted by short sellers. So, high short interest in high dividend stocks may signal danger. We compiled the list of stocks that have at least 5% dividend yield and a minimum of 5% open short interest. These stocks may be substantially riskier than other high dividend yielding stocks: ... more

12 Best Buffett and Soros Dividend Stocks for Your Portfolio

At Investment Underground, we admire Warren Buffett's and George Soros' stock picking skills. And we also love getting paid dividends. We decided to take a look at the stocks that either Buffett or Soros (or both) own that pay good dividends to shareholders. Here's what we found, plus some commentary on each:Johnson & Johnson (JNJ): A classic Warren Buffett pick. The healthcare giant trades 12.5 times EPS, 2.9 times book value per share, and 2.7 times revenues per share. The respective industry averages are 13, 2.7, and 2.5. In 2010, EPS was $4.78, which was an increase of 8.64%, after falling 3.72% in 2009. For 2011, the company expects EPS to be between $4.72 and $4.82. Q1 2011 earnings come out on April 19. We think this is a healthcare stock that Buffett may continue to buy.Walmart... more

What Does the Bank of America Smackdown Mean for Investors?

In fact, after years of being an afterthought to the go-go years of the '60s and the Internet boom of the '90s, dividends are once again becoming quite the fad. Is a dividend that important? This year, profit margins for US companies will reach their highest levels since 1993; they're increasing to 8.9% in 2011, according to Bloomberg. And companies have stockpiles of cash that they've been sitting on since the financial crisis in 2008, and it's getting to be about that time that they start dishing out some payments.... more

Philip Morris International: Dividend Dynamo or Disaster?

Let's take a look at how Philip Morris (NYSE: PM ) stacks up in four critical areas to see if it's a dividend dynamo or a disaster in the making. 1. YieldFirst and foremost, dividend investors like a large yield. But if a yield gets too high, it may reflect investors' doubts about the payout's sustainability. If investors had confidence in the stock, they'd be buying it, driving up the share price and shrinking the yield.... more

Portrait of a Beautiful Dividend Growth Stock

I don’t know why I remember this, but when I was a kid, I found a movie magazine in my grandmother’s house. It had an article that tried to describe the ideal movie star’s face (female persuasion). So they took, like, Marilyn Monroe’s mouth, Jane Russell’s eyes, and the chin, cheekbones, forehead, and hair from other actresses they considered to be best of type. Using the cut-and-paste technology of the times, they glued together pieces of pictures to create the ideal actress’s face.The result was a mess. Even to my young eyes, what they wound up with needed some work, shall we say. The lesson to me was that it’s as much about how things fit together, not just the beauty of the individual pieces, that creates a beautiful face.I think the same principle applies to companies... more

5 Dividend Growth Machines Near 52-Week Lows

Finding stable companies with histories of increasing dividends is just the first part of a sound investment strategy. Next, and just as important, is buying those companies at bargain prices. There are many ways to find such deals, but one of the quickest is to check a company's current price and its 52-week low. If it's trading at or near this number, it *may* be undervalued. I say "may" because a company trading at or near its 52-week low is not necessarily a good buy. Our job as diligent investors is to determine whether these price movements are the result of short term fear (good) or deeper financial issues (bad). But when looking at what can quickly become an overwhelming list of stocks, finding those trading at or near their 52-week lows can be a quick and dirty way of narrowing... more

Why Did Fed Reject Bank of America's Dividend Plan?

In a shocking turn of events, the Federal Reserve has rejected the plan Bank of America (BAC) submitted to raise its dividend "modestly" in the second half of the year. The bank had signaled its new strategy would be to return large amounts of excess capital to shareholders over the next several years, and while this news does not necessarily change the long term story, it does delay the onset. So what caused the rejection? The Federal Reserve told all 19 banks that submitted capital plans that they were not allowed to discuss the findings by the Fed, only whether or not the capital plans were approved. This leaves us in the dark for the large part, and forces us to speculate on why the dividend plan from BAC was rejected. To me, there are 3 problem points that could have led to the... more