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Jim Trippon
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Jim Trippon is an Amazon.com bestselling business and finance author, a practicing CPA, and a fee based investment advisor. His portfolio of companies includes J.M. Trippon & Company CPA, Trippon Wealth Management & Trippon Financial Publishing. Jim has dedicated his business career to... More
My company:
Trippon Financial Research, Inc.
My blog:
Global Profit$ Alert
My book:
Stay Rich Forever: Retirement Planning Secrets of Millionaires and How They Can Work For You!
  • Waiting For Bank Dividends To Return? Check Out The Alternatives 0 comments
    Mar 21, 2011 9:41 AM | about stocks: BAC, JPM, PNC, WFC, HTGC, BCA
    By now, every income investor knows the recent and tragic history of the big money center banks and their paltry, and in some cases, non-existent dividends. As been noted plenty of times over the past three of four years, bank stocks were once a dividend paradise. They are now a dividend wasteland.

    I'm not going to bore you with the bank-by-bank rundown, but the situation is grim. There is good news though. On Wednesday, Dow Jones reported that Goldman Sachs is kind of bullish on bank dividends and that the payouts may be better than many are expecting. Goldman predicts that Bank of America (NYSE: BAC), J.P. Morgan Chase (NYSE: JPM), PNC (NYSE: PNC) and Wells Fargo (NYSE: WFC) have "more dividend upside" than the market’s current view, the Wall Street Journal reported.

    Let's hope that's the case because as the chart below indicates, the bank dividend situation as it currently stands isn't pretty.

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    There's a decent chance we may even see some positive dividend action from the likes of J.P. Morgan Chase and Wells Fargo this year, but for investors eager to gain exposure to the financial services sector whilr getting compensated, there are some noteworthy options that can be taken advantage of right now or further down the road if the market continues to pull back.

    One sub-sector of the financial services space to have a look at is business development corporations. These companies don't get a lot of attention from the mainstream financial press and most fall into the small-cap universe, but don't let that dissuade you. The market values may be small with these guys, but yields can be big. Hercules Technology Growth Capital (Nasdaq: HTGC) is one to look as that company recently raised its dividend by 10%.

    If you just have to own a traditional bank in your income portfolio, it would be best to make it a foreign one, at least until U.S. bank dividends return to pre-crisis levels and who knows when that's going to happen?

    I've previously talked about the strength of select foreign banks and their dividends and have had some success with a couple for Dividend Genius subscribers. Canada would be one market to consider, but for the truly adventurous investor, looking south of the border might be a better dividend deal. Emerging markets are out of favor right now, but that might present an opportunity to at least consider some of Latin America's banks.

    Chile's Corpbanca (NYSE: BCA) with a yield of 6.6% is one name to put on your list. The bank recently raised $900 million in capital and with a robust outlook for the Chilean economy going forward, Corpbanca could be a winner.

    Click HERE to learn more about the Dividend Genius - Smart Research on High-Yield Stocks
    What Most Investors Want Right Now

    A recent in-depth survey of a group of investors hurt in the 2008 stock market meltdown revealed three necessary characteristics of stocks that would get them back in the market.

    To see what those characteristics are, and to discover how we found the exact stocks that met all criteria (and produced an overall return of 62% the next year), click HERE!


    For more information and archived issues, visit http://www.globalprofitsalert.com

    Global Profits Alert (GPA) is published by Trippon Financial Research, Inc. a financial media organization with offices in the United States, Hong Kong and Mainland China. GPA is written by Jim Trippon in conjunction with George Wolff, Sunny Wang, Todd Shriber, Kelley Damiani and J. Daryl Thompson.

    Would you like to republish this article? Global Profits Alert issues can be republished, as long as the republished issues contain the name of the author(s) and the following short paragraph:

    This information was brought to you by GlobalProfitsAlert.com, a publication of Trippon Financial Research, Inc. GlobalProfitsAlert.com publishes information on Investing in the China stock market and emerging markets, dividend stock and income investing, exchange traded funds (ETFs), green energy stocks, technology stocks, global market trends and other investment information. To view archives or subscribe, visit http://www.globalprofitsalert.com.

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