3 High Yield Stocks With Excellent Dividend Coverage

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Includes: APSA, BOX-OLD, SPOK
by: Kapitall

If you're looking for dividend income ideas, this list might offer an interesting starting point.

To compile this list, we started with a universe of about 80 companies that have dividend yields higher than 4%, and payout ratios below 30%.

We then calculated trailing twelve month (TTM) operating cash-flow per share, and TTM levered free cash flow per share, and identified the high yielding stocks that had the best dividend coverage.


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Of course, high yields often indicate higher levels of risk, so please be careful, and only use this list as a starting point for your own analysis.

1. USA Mobility, Inc. (USMO): Wireless Communications Industry. Market cap of $340.34M. Dividend yield at 6.5%, with a payout ratio of 20.16%.

TTM Operating Cashflow at $81.42M, which translates into operating cash flow per share at $3.69 (vs. annual dividend per share at $1, which means that TTM Operating Cashflow per share / annual dividend per share stands at 3.69).

TTM Levered Free Cashflow at $49.74M, which implies levered free cashflow per share at $2.25 per share (vs. annual dividend per share at $1.00, which implies a TTM Levered Free Cashflow per share / dividend per share ratio at 2.25).

2. Alto Palermo S.A. (NASDAQ:APSA): Property Management Industry. Market cap of $332.55M. Dividend yield at 5.8%, with a payout ratio of 25.51%.

TTM Operating Cashflow at $78.01M, which translates into operating cash flow per share at $2.48 (vs. annual dividend per share at $1.01, which means that TTM Operating Cashflow per share / annual dividend per share stands at 2.45).

TTM Levered Free Cashflow at $86.71M, which implies levered free cashflow per share at $2.75 per share (vs. annual dividend per share at $1.01, which implies a TTM Levered Free Cashflow per share / dividend per share ratio at 2.73).

3. SeaCube Container Leasing Ltd. (NYSE:BOX-OLD): Rental & Leasing Services Industry. Market cap of $324.17M. Dividend yield at 5.5%, with a payout ratio of 23.05%.

TTM Operating Cashflow at $76.74M, which translates into operating cash flow per share at $3.81 (vs. annual dividend per share at $0.88, which means that TTM Operating Cashflow per share / annual dividend per share stands at 4.33).

TTM Levered Free Cashflow at $117.62M, which implies levered free cashflow per share at $5.84 per share (vs. annual dividend per share at $0.88, which implies a TTM Levered Free Cashflow per share / dividend per share ratio at 6.64).

*All data sourced from Yahoo Finance.

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

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