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John Mylant
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Residing in Colorado Springs, Colorado. Has been trading and coaching using a self-developed option trading system for 10 years. Philosophically conservative, accurately trades weekly options with a strong risk management approach. Well sought after by investors around the world, he teaches a... More
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  • Three Stocks with Very High Dividend Yields 0 comments
    Dec 12, 2011 2:49 PM | about stocks: FTR, AGNC, NOK
    Income stocks are always an important part of any investor's portfolio and high dividend stocks are always of interest, especially for retiree’s portfolios. Here are three stocks with high dividend yields that are worth knowing and researching.

    Frontier Communication Corp (FTR)
    Trading Volume: 13,713,656
    Frontier Communications Corporation, a communications company, provides regulated and unregulated voice, data, and video services to residential, business, and wholesale customers in the United States. It offers local and long distance voice services, including basic telephone wireline services to residential and business customers; switched access services that allow other carriers to use the facilities to originate and terminate their long distance voice and data traffic; and directory services that provide white and yellow page directories for residential and business listings.

    With an average dividend yield of 9.4% over the last 5 years FTR is definitively an income stock. A company whose leadership is deeply committed to its dividend, FTR has been in a downward pattern since its peak in January of 2011. With an ambitious broadband growth program in place and cash outlay, those dividends may not remain as high. A goods investor also might explore buying the stock long term and using an options to increase income.

    American Capitol Agency Corp (AGNC)
    Volume: 3,470,597
    American Capital Agency Corp. operates as a real estate investment trust (REIT). It invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by a U.S. Government agency or U.S. Government-sponsored entity. The company funds its investments primarily through short-term borrowings structured as repurchase agreements.

    One of three REIT's that beat third quarter analysts expectations, they continue to perform well and consistently. With a solid management team investors can count on this type of performance to continue. Todd Johnson wrote an article on AGNC and this is what he wrote about the management team: "The team has provided AGNC-shareholders consistent results that outperform the respective mREIT sector. The company has paid a $1.40 dividend for 9-quarters. The book value per share was $26.76 as of June 30th, 2011."  Look for high yields to continue from this company.

    Nokia Corp (NOK)
    Volume: 24,177,048
    Nokia Corporation manufactures and sells mobile devices, and provides Internet and digital mapping and navigation services worldwide. Its Devices & Services segment develops and manages a portfolio of mobile devices; and services comprising applications and content. It also offers Internet services focusing on navigation, applications and games, music, and mail, as well as on the tools that enable developers to create applications under the Ovi brand name.

    With the Lumia 800 phone expected to fight its way into smartphone share holder space via Microsoft platform, Nokia is developing a nice income stream for its future. NOK has a forwarding dividend yield of 8.3% and that should continue. With the recent drop in price due to analyst downgrade of Lumia 800 sales expectations, NOK might be a good buy. NOK is the world leader in mobile phone sales, but needs to break into the smartphone market where growth and profitability have the greatest potential right now.

    As a savvy investor it is important to note that high dividend can become a problem when a company is growing but can find nothing better to do with its profits than pay dividends. Maybe it should be used to develop new projects designed to expand the business. Is the company using its money to hire new employees or investing in opportunities that would create additional jobs? Do your research. By paying a dividend, the company is proving that it has financial strength and will be around for a while, but the entity may also be doing itself a disservice.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
    Stocks: FTR, AGNC, NOK
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