The market is seeing its second day of significant losses. This sell-off was predictable but offers opportunities to buy some high yielders reporting good news today. Value investors should keep their trigger fingers at the ready.
Aircastle (NYSE:AYR) handles leases and sales of high-utility commercial jet aircraft to passenger and cargo airlines worldwide. The company also makes investments in various aviation assets, including debt investments secured by commercial jet aircraft.
Four reasons AYR is a solid value pick at $14 a share:
- I have been positive and have owned AYR since it was at $12 in April. The company just reported another quarter that beat consensus on the top and the bottom lines. This is the sixth time of the last seven quarters the company has crushed earnings estimates.
- The stock yields 4.7% and the company has raised its payout by 65% after escaping the financial crisis.
- AYR sells at just over 8x forward earnings, a low valuation for a high yielder.
- S&P has a "Buy" rating and a $16 price target on the shares.
Linn Energy LLC (LINE) is an independent oil and natural gas company with properties that are primarily located in the Mid-Continent, the Permian Basin, Michigan, California and the Williston Basin in the United States.
Four reasons LINE belongs in your income portfolio at $38 a share:
- It just bought Berry Petroleum (BRY) for a 20% premium. This made me happy as I am a Berry shareholder as well as holding LINE. This is a good strategic acquisition for Linn Energy and one Tudor Pickering is positive on and Jim Cramer has called a "brilliant acquisition" on CNBC this morning.
- The stock yields 8.1% and the company has grown dividend payouts at an approximate 4% annual rate over the past five years.
- The company increases revenues by more than 50% in FY2012. Analysts also expected over 40% sales gains in FY2013, and this was prior to the Berry acquisition.
- LINE is selling near the bottom of its five-year valuation range based on P/S and P/E.
Disclosure: I am long AYR, BRY, LINE. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.