Dividend yielding stocks

[Garpal Gumnut]

All fair points but I do find your 2nd commandment questionable at best!

I just don't understand why you wouldn't want to profit (or have the option of hedging against loss) by being able to go short as well as your current method.

Good point.

One needs a different mindset/skills to short.

I tried it and lost.

I just don't have the skills either ingrained or learnt to profit from it.

gg

 

[boofis]

Good point.

One needs a different mindset/skills to short.

I tried it and lost.

I just don't have the skills either ingrained or learnt to profit from it.

gg

Respect. Knowing when something 'works for you' and when it doesn't is a fine display of self awareness.

 

[Wysiwyg]

Surely you'd be better off investing that cash in , say, high yield shares where you'll generate around 7.5% grossed up yield and possibly capital gain as well?

Wondering Julia, what is paying 7.5% grossed up with possible appreciating share price from here? I have present share price ANZ at 7.73% grossed up this CY using a company tax rate of 30% (actually 29.3%).

 

[Julia]

Wondering Julia, what is paying 7.5% grossed up with possible appreciating share price from here? I have present share price ANZ at 7.73% grossed up this CY using a company tax rate of 30% (actually 29.3%).

I don't understand your question, other than your correction that the grossed up yield is presently running at 7.73% rather than my quoted approx 7.5%.
Are you suggesting that ANZ has no potential for increase in SP?
Whatever, it's surely better than the at call rate of under 4%, isn't it?

 

[Wysiwyg]

I don't understand your question, other than your correction that the grossed up yield is presently running at 7.73% rather than my quoted approx 7.5%.
Are you suggesting that ANZ has no potential for increase in SP?
Whatever, it's surely better than the at call rate of under 4%, isn't it?

That's okay. I will present the same question another way with further explanation. You posted on another thread :-

Surely you'd be better off investing that cash in , say, high yield shares where you'll generate around 7.5% grossed up yield and possibly capital gain as well?

My interpretation of that sentence is the portfolio would be generating around 7.5% grossed up yield. Now for the portfolio to generate that approximation it would have some high yielding constituents at or above that figure. This is the only way to achieve such a high dividend yielding portfolio.

My example, ANZ, is a high yielding stock that is around your 7.5% figure.

The question I asked is what stocks are paying around 7.5% grossed up yield with possible appreciating share price from here?

Now onto your question.

Are you suggesting that ANZ has no potential for increase in SP?

I didn't suggest anything but in answer to your question, with a high dividend yielding stock such as ANZ with dividends increasing year on year, there surely will be an attraction to them.

 

[Julia]

That's okay. I will present the same question another way with further explanation. You posted on another thread :-



My interpretation of that sentence is the portfolio would be generating around 7.5% grossed up yield. Now for the portfolio to generate that approximation it would have some high yielding constituents at or above that figure. This is the only way to achieve such a high dividend yielding portfolio.

My example, ANZ, is a high yielding stock that is around your 7.5% figure.

The question I asked is what stocks are paying around 7.5% grossed up yield with possible appreciating share price from here?

OK, so you just wanted me to give you a list of such stocks. I'd rather not. Could be seen as advice.
Any of the banks fulfil that criteria. TLS is another. All made decent capital gains on top of the grossed up yield.

I didn't suggest anything but in answer to your question, with a high dividend yielding stock such as ANZ with dividends increasing year on year, there surely will be an attraction to them.

I can't comment. Can only say that as long as the cash rate remains so low that will keep at least the funds of many Super investors in them.

 

[herzy]

OK, so you just wanted me to give you a list of such stocks. I'd rather not. Could be seen as advice.
Any of the banks fulfil that criteria. TLS is another. All made decent capital gains on top of the grossed up yield.


I can't comment. Can only say that as long as the cash rate remains so low that will keep at least the funds of many Super investors in them.

The thread referred to had an investment time period of 40-odd years. With that in mind, it seems logical to invest in high-yielding stocks with good prospects rather than cash.

I agree with Julia that TLS, the banks etc, are preferable to cash at the moment, despite currently high prices.

 

[Julia]

wysiwyg. a high yielding stock is MND (Monadelphous), a market darling for a few years. Now yielding 10% plus 100% franking.
If you're looking for yield, would you go for this, and maybe say why or why not?

 

[orr]

I have to admit the the idea of yield mixed with a chance of gain? is that what we're here for?.. I've just looked back over this thread, a post by Sydboy listed a few stocks. So I looked at a couple. For those interested have a look at the SNG thread in this forum read the last post and then check the stocks performance for the next six months, from that post on your own research. got to love the work of the chartists.

 

[pinkboy]

wysiwyg. a high yielding stock is MND (Monadelphous), a market darling for a few years. Now yielding 10% plus 100% franking.
If you're looking for yield, would you go for this, and maybe say why or why not?

Discussed here:

https://www.aussiestockforums.com/forums/showthread.php?t=28781


pinkboy

 

[Wysiwyg]

wysiwyg. a high yielding stock is MND (Monadelphous), a market darling for a few years. Now yielding 10% plus 100% franking.
If you're looking for yield, would you go for this, and maybe say why or why not?

Thanks Julia.
I bought in at $12.14 last market pullback and after considering skc's posts I sold at $12.49. Likelihood of an appreciating share price is a consideration I favour when making decisions on stocks. I feel it prudent to wait for this particular stock. There are some high fliers that have fallen a long way and hence their yield has risen which makes them very alluring but not wise if there is a possibility of further share price downside and then compounded by a dividend cut.

 

[Wysiwyg]

I have to admit the the idea of yield mixed with a chance of gain? is that what we're here for?.. I've just looked back over this thread, a post by Sydboy listed a few stocks. So I looked at a couple. For those interested have a look at the SNG thread in this forum read the last post and then check the stocks performance for the next six months, from that post on your own research. got to love the work of the chartists.

Speculation on price movement is the other game in town. SNG is not a listed FPO stock on the ASX.

 

[pixel]

Speculation on price movement is the other game in town. SNG is not a listed FPO stock on the ASX.

Reckon orr made a typo. Syd's stock was SGN, which may have fallen since over the last 18 months, but is still paying over 8cps FF; so I guess it meets Syd's criteria as a reasonably profitable yielding share.
As are four of Syd's other 5 selections: AAD, AFI, ARG, IHD.
Check out the dividends at the ASX site. IHD's looks spectacular:
http://www.asx.com.au/asx/markets/dividends.do?by=asxCodes&asxCodes=ihd&view=all

 

[Wysiwyg]

T
I agree with Julia that TLS, the banks etc, are preferable to cash at the moment, despite currently high prices.

All divvies mentioned are grossed up and prices are the low for those years so best case scenario. As an example of an attractive dividend yield relative to price.

Telstra (TLS)

2007 Low of $4.17 = 9.5% -- Pretty good hey
2009 Low of $2.93 = 13.6% -- Fantastic
2011 Low of $2.64 = 15.5% -- Now where raking it in
2014 present $5.77 = 7.3% -- Oh, bit of a hit but still good

Telstra would be a great dollar cost averaging strategy I reckon because they have a stable dividend payment and not really worth waiting for or trying to pick a lower share price entry for a higher return.

 

[Julia]

Discussed here:

https://www.aussiestockforums.com/forums/showthread.php?t=28781
pinkboy

Thanks for that, pinkboy.

Thanks Julia.
I bought in at $12.14 last market pullback and after considering skc's posts I sold at $12.49. Likelihood of an appreciating share price is a consideration I favour when making decisions on stocks. I feel it prudent to wait for this particular stock. There are some high fliers that have fallen a long way and hence their yield has risen which makes them very alluring but not wise if there is a possibility of further share price downside and then compounded by a dividend cut.

Yet another reason to be grateful to skc for his wisdom.
Despite the high yield, I wouldn't be touching MND in the current environment of commodity price volatility and the unwinding mining situation. It was a great stock to hold from 2009 through to 2013 when the SP went from around $5 up to nearly $30.

 

[luutzu]

MND is one of the best run company out there. I could look very smart, or very foolish, in a few years time with it. I can tell you it's been making me looking really foolish for a while.

I haven't looked at its latest annual report, but had a good look over some ten years and very impressed.

Yes, the past could be just that... but it's been around some 40 years... there's at least a couple of mining boom and bust in that time. That and its financial position is sound, its returns are amazing, and its management always seem to know how to acquire and integrate other businesses. The businesses they acquire actually expand the groups sales and profits, and further diversify and extend/integrate current services with the new.

It's not just into construction/engineering, a major earning stream is site maintenance. It did see the decline in mining a few years back and moved into infrastructure like waste/water management. Its C/E business, from memory, is not just mining but for a couple years now dominantly in LNG.

MND is a good case to see if one ought to make investment decision based on current position and historical performance or ignore that and peek into the "obvious" future.

 

[So_Cynical]

WMK - Watermark market neutral fund, paid 5 CPS FF divi last year and currently trading at around 96c so a gross yield of 6.7% ~ for a fund with 90% of is cash in Bonds, that's a pretty good yield.

 

[galumay]

MND is one of the best run company out there. I could look very smart, or very foolish, in a few years time with it. I can tell you it's been making me looking really foolish for a while.

I agree, i have taken a position in MND recently for my SMSF, the whole sector has been grossly oversold. I worked for the last 20 years in the mining industry and people just dont understand how it works, sure the 'boom' has finished for now, but most mining companies will continue to operate, just not with the rapid expansion seen previously. Mining services companies will still be widely used to support the ongoing operations.

The mining companies always contract out a fair amount of trades work because its simply less economic to do it in house. This will continue and any mining services companies with the capability, low debt and good management will continue to be profitable thru the cycle.

MND, NWH and a few others are fantastic contrarian buying at the moment, and the yields are amazing if you get in now.

 

[Klogg]

MND, NWH and a few others are fantastic contrarian buying at the moment, and the yields are amazing if you get in now.

You can buy $1.17 of NTA (plus franking credits) in NWH for < 70c at the moment. Granted you have to look at a lot of factors, including at asset quality, resale value of assets and whether or not management might have cost blowouts (and other factors), but it does indicate a good place to start.

 

[skyQuake]

You can buy $1.17 of NTA (plus franking credits) in NWH for < 70c at the moment. Granted you have to look at a lot of factors, including at asset quality, resale value of assets and whether or not management might have cost blowouts (and other factors), but it does indicate a good place to start.

NWH has other things driving the price at the moment. imo you're better off buying after 25th Nov