5 Dividend Sizzlers With Yields As High As 19.1% (Part II)

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Includes: BKCC, KMB, OCSL, PBI, PSEC, TNK
by: Tactical Investor

Well done is better than well said. - Benjamin Franklin

This is part two of the dividend sizzler series. The first one, 5 Dividend Sizzlers In The S&P 500 With Yields As High As 10.9% was published 10 days ago. Investors are encouraged to do their due diligence before opening any positions in the stocks mentioned. The list of stocks below should be viewed as a starting point for those seeking higher dividends, but it should not be viewed as “buy list.” For example, special attention should be paid to the fact that Teekay Tankers (NYSE:TNK) has a payout ratio of 309%. This is an extremely high payout ratio and is not sustainable over the long haul.
Investing in high dividend stocks produces significantly higher rates of return over the long run in contrast to investing in low or non dividend-paying stocks. Some companies such as Pitney Bowes (NYSE:PBI) have been paying dividends for decades, and PBI is also one of the few companies that has consecutively increased its dividend for 29 years in a row. Even though it has a boat load of debt, PBI generates a huge amount of cash. Its operating cash flow is $977 million, and its levered free cash flow is $871.83 million. Another great play which has not been covered today is Kimberly-Clark (NYSE:KMB), which has increased its dividend for 14 consecutive years in a row. It has been paying dividends since 1992 and has a yield of 6.60%. Its operating cash flow is $2.71 billion and KMB’s levered free cash flow is $932.75 million.

Two other benefits from investing in dividend stock:

  • Passive Income - dividend payments come at regular intervals and can be used as source of income. This is in addition to any capital gains you might have made as a result of owning the stock.
  • You can turbo-charge your capital gains by reinvesting the dividend payments. Instead of getting cash, your dividends are automatically used to purchase additional shares in the company. This type of dividend investing is known as DRIP. This could boost your capital gains significantly down the line as you are being paid with free stock instead of cash. If the price of the stocks rises, your gains will be boosted as a result of owning more shares.
Stock
Dividend
Debt to Equity ratio
Market Cap
PE
Total Cash
Operating margins
Revenue
Qarterly Earnings Growth (yoy):
15.6
38%
540M
6.8
46.3M
65.82%
112M
74.2%
FSC
13.90
39%
668M
9.3
17.1M
64.4%
107.5M
N/A
14.4%
29%
928M
6.17
1.4M
65.8%
169.4M
84.9%
19.10%
66
335M
17.3
16.5M
16.3%
116.M
-44%
8.9%
> 100%
3.80M
11.3
624M
15.1%
5.4B
64.4%
M=Million, B=Billion
BlackRock Kelso Capital Corp (NASDAQ:BKCC)
Additional Info
  • Paying dividends since 2007
  • Percent of shares held by institutions: 51.8
  • Percent held by Insiders: 1.9
  • Short % of Float: 6.5
  • ROE: 11.13
  • Book Value: $9.83
  • Forward Dividend: 14.00
  • Payout ratio: 143%
Fifth Street Finance Corp (FSC)
Additional Info
  • Paying dividends since 2008
  • Percent of shares held by institutions: 62.9
  • Percent held by Insiders: 5.3
  • Short % of Float: 8.99
  • ROE: 8.82
  • Book Value: $10.72
  • Forward Dividend: 14.00
  • Payout ratio: 131%
Prospect Capital Corporation (NASDAQ:PSEC)
Additional Info
  • Paying dividends since 2004
  • Percent of shares held by institutions: 29.5
  • Percent held by Insiders: 2.58
  • Short % of Float: 11.2
  • ROE: 12.95
  • Book Value: $10.36
  • Forward Dividend: 14.5%
  • Payout ratio: 110%
  • 5 year dividend average: 13.2%
Teekay Tankers Ltd (TNK)
Additional Info
  • Paying dividends since 2008
  • Short % of Float: 9.10%
  • ROE: 3.52
  • Book Value: 8.55
  • Forward Dividend: 16.2
  • Payout ratio: 309%
  • Net Income: 16.77 million
  • EBITA: 56.42 million
Pitney Bowes Inc (PBI)
Additional Info
  • Paying dividends since 1934
  • Percent of shares held by institutions: 83.5
  • Percent held by Insiders: 0.21
  • Short % of Float: 12.2%
  • ROE: 158.17%
  • Forward Dividend: 14.5%
  • Payout ratio: 89%
  • 5 year dividend average: 5.5%
  • Consecutive Dividend increases for 29 years
  • EBITA: 1.10 billion
  • Net income: $353 million
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.