Dividends are basically cash that a company pays you to own their stock. Usually these payments are reaaaally small, and just a slight bonus, not the reason to buy the stock. However, there are a few stocks out there where the dividends are so high its worth owning them just for the payouts. First, some useful dividend lingo that can save you headaches:
- Declaration Date- The day the company announces it will distribute dividends.
- Ex-dividend Date- After this day shares bought will not be paid the dividend and owners as of this date can sell their shares and still recieve the dividend.
- Record Date- Those who were 'on record' on or before this date recieve the dividend. Those who were not do not. (registration for being 'on record' is almost always automatic.)
- Payment Date- The day on which dividends are distributed to those who are eligable.
Here are some stocks that I've found which pay great dividends, or atleast have payed great ones in the past. To find great dividend yielding stocks, you usually have to look past mainstream stocks like Google or Apple. You'll see what I mean in a second.
Alesco Financial Inc. (NYSE: AFN)
2007-2008 Dividends Cash Distributions (Payment Dates):
- 3/15/2007-------------------$.30
- 6/25/2007-------------------$.31
- 10/1/2007-------------------$.31
- 1/10/2008-------------------$.31
- 4/10/2008-------------------$.25
Current Price (3/21/2008 Close Price): $2.85
The current quarterly yield of owning AFN is 8.78%. AFN is also a Real Estate Investment Trust (REIT.) This is a special kind of stock that among other rules is obligated to give back atleast 90% of its income to its shareholders. It's good for them because they don't pay tax on this money, and its good for us because we get sick dividend pay outs, like those of AFN.
ECC Capital Corp. (OTC:ECRO)
2007-2008 Dividends Cash Distributions (Payment Dates):
- 1/29/2007-------------------$.24
- 3/30/2007-------------------$.07
- 3/21/2008-------------------$.10
Current Price (3/21/2008 Close Price): $.16
The current quarterly yield of owning ECRO is 62.5%. I know I constantly seem to be discussing ECRO. I'm lame, and I swear I don't work for them. I just think their a really interesting trading option. And the check I got today for owning them is the reason I decided to write this post. They, like AFN, are a REIT. They aren't as regular or predictable with their dividends, when they decide to pay out, make sure your their to get it, because it's an easy way to make a killing.
Realty Income Corp. (NYSE:O)
2007-2008 Dividends Cash Distributions (Ex-Dividend Dates):
- 1/30/2007-------------------$.13
- 2/27/2007-------------------$.13
- 3/29/2007-------------------$.13
- 4/27/2007-------------------$.13
- 5/30/2007-------------------$.13
- 6/28/2007-------------------$.13
- 7/30/2007-------------------$.13
- 8/30/2007-------------------$.14
- 9/27/2007-------------------$.14
- 10/30/2007-------------------$.14
- 11/29/2007-------------------$.14
- 12/28/2007-------------------$.14
- 1/30/2008-------------------$.14
- 2/28/2008-------------------$.14
Current Price (3/21/2008 Close Price): $26.91
The current quarterly yeild (using four monthly yields) of owning O is %2.1. While this is no where close to the huge yields of the first two, O prides its self of the consistency of its dividend payments and increases. Known as the Monthly Dividend Company, O has increased dividends 48 times since 1994 and paid monthly dividends for 457 months straight. An investment in O, regardless of action of the stock price, will create great returns. And best, its in CA$H.
Dividends offer a great opportunity to get a little cashflow from your investments. Sometimes, they present a unique investment opportunity that can give huge returns. (Like ECRO did for me this month.) Keep an eye out for high yielding stocks, visiting the websites below could be helpful, and happy investing.
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