My goal is to maintain a growing monthly income cash stream. These 7 securities provide a steadfast monthly dividend stream to my brokerage account. My goal is to judge their performance. I reinvest the monthly dividends. If a company appears to have problems, then I will sell the security and deploy cash into a new monthly income equity. Here is a discussion on the 7 stocks mentioned below.
The investor, when reviewing the below chart, needs to recognize the assumption monthly dividends are not included in the "annualized performance" column. Dividends are assumed to be received in cash.
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Pengrowth Energy Corporation (PGH)
Pengrowth Energy Corporation engages in the acquisition, exploration, development, and production of oil and natural gas reserves in the western Canadian Sedimentary Basin. It primarily explores for crude oil, natural gas, and natural gas liquids in the provinces of Alberta, British Columbia, Saskatchewan, and Nova Scotia. Pengrowth's business strategy focuses on oil and natural gas production within well-known deposit locations. The company wants to be known as the lowest cost producer per its August 2011 investor presentation.
The current dividend is an attractive 8.2% annual yield. The company is currently paying 7-cents, per month, per share. I am reinvesting the dividends to provide a constant increase in net income coming in the door.
Enerplus Corporation (NYSE:ERF)
Enerplus was established in 1986. The company is a North American enterprise. The company operates as an independent oil and gas producer with a diversified asset base of oil and gas that offer both a stable cash flow stream as well as growth potential. The company's core assets are located in energy-rich western Canada, including the provinces of Alberta, British Columbia, Saskatchewan, and Manitoba. Enerplus also operates in the United States. Specifically, the company has operations in Montana, North Dakota, Pennsylvania, Maryland, and Delaware.
Enerplus owns over 230,000 acres of undeveloped land in the Williston Basin. The well-known Bakken area provides 17% of the company's daily production. Enerplus also owns a significant Marcellus shale gas position. The company owns 110,000-net acres. Because these assets are located in the northeastern region of the US, the natural gas has a premium price. The reason is due, to the proximity to an expanding pipeline in the area and the population concentrations.
The business model is designed to provide investors a high shareholder return through growth and income. The company is aggressive in pursuing new assets and selling assets at opportune times. The current dividend is 8.2%. I am very pleased with the company's reliability to deliver monthly dividends. The above table 5-year returns do not reflect my decision to reinvest the stable monthly dividends into more Enerplus shares month-in and month-out.
Sabine Royalty Trust (NYSE:SBR)
Sabine Royalty Trust was established at the end of 1982. Sabine's business model is to produce oil and natural gas production. On a monthly basis these net-proceeds are shared with unit holders. The energy holdings are mineral interests in producing and proven undeveloped oil and gas properties in Florida, Louisiana, Mississippi, New Mexico, Oklahoma and Texas.
I have been extremely pleased with Sabine's out performance of other US trusts. Sabine has provided shareholders a 15.4% total annualized rate-of-return for the past 5 years. This assumes unit holders do not reinvest dividends.
On October 4th, the company announced their October dividend. The payment will be $0.35272 per unit, payable on October 31, 2011, to unit holders of record on October 17, 2011. Sabine currently provides shareholders an annual 7.2% dividend yield.
Hugoton Royalty Trust (NYSE:HGT)
Hugoton Royalty Trust was formed in 1998. It holds an 80% net profits interests in certain natural gas producing working interest properties of XTO Energy Inc. (XTO). These properties are located in conveyed 80% net profits interests in certain predominantly gas-producing properties located in Kansas, Oklahoma and Wyoming. The trust is primarily producing natural gas. The investor can note, per the below table, the current relatively low price of natural gas. If natural gas does increase, then Hugoton's dividend will increase accordingly.
Exxon-Mobil (NYSE:XOM) bought out XTO energy in recent years. XTO spun off Hugoton shares to XTO shareholders prior to the buyout.
The trust's October dividend is $0.133413 per unit. The payable date is October 17, 2011, to unit holders of record on September 30, 2011. The current annual dividend yield is an attractive 7.2% annual payout.
In the below chart provided by US Energy Information Administration, investors can note the Henry Hub Gulf Coast Natural Gas Spot Price (dollars/milion BTUs) from 1997 through the present month.
San Juan Basin Royalty Trust (NYSE:SJT)
San Juan Basin Royalty Trust is a trust I have almost sold on a couple of occasions. However, San Juan Basin Royalty Trust is one of my favorite trusts and I have continued to reinvest the monthly dividends. I know if natural gas prices can increase, the monthly dividends will increase accordingly. The trust owns a significant amount of untapped natural gas assets. The equity provides a 6.8% annual dividend. The trading range continues to be in a mid $20 per unit range.
The trust has a 75% net overriding royalty interest in northwestern New Mexico. The royalty interest is based upon oil and gas leasehold and royalty interests. The entire area covers 119,000-net acres and 1,173-net wells.
The October dividend is $0.133431 per unit, based principally upon production during the month of July 2011. The distribution is payable October 17, 2011, to unit holders of record as of September 30, 2011.
Provident Energy Ltd. (PVX)
Provident Energy Ltd. is a Calgary-based corporation that was formed in 1993. Provident's functions for third party customers include the extraction, processing, storage, transportation, fractionation, storage, NGL terminalling, loading, and offloading services, and marketing of NGLs. Provident's midstream facilities are strategically located in western Canada and in the premium NGL markets in eastern Canada and the US.
As a midstream enterprise, the risk of commodity price exposure is limited. The 6.0% is reliable and I am 100% comfortable owning this security at current prices.
The company's most recent monthly dividend was 4.6 cents per unit.
Baytex Energy Corp. (NYSE:BTE) Baytex Energy Corp engages in the acquisition, exploration, development, and production of petroleum and natural gas in the western Canadian Sedimentary Basin and the United States. The company has 3-core business units: Canadian heavy oil, Canadian light oil and gas and United States. As of December 31, 2010, it had proved-reserves plus probable reserves of approximately 229 million barrels of oil equivalent.
Baytex Energy is my favorite Canadian oil dividend stock. The focus upon growth is clearly to produce a reasonable current income, but also a net higher total stock appreciation. The growth will allow the dividend to increase rapidly overtime. Due to its focus upon growth, the stock has a high beta of 1.70. The business model is focused upon increasing annual organic production by a minimum of 8%.
In an October 2011 investor presentation, Baytex provided an update on the ownership position of Baytex stock. Investors can note the high level of Canadian ownership and global institutional ownership.
Baytex has returned a 29.3% total annualized rate-of-return, on average, over the past 5 years. The current dividend yield of 4.7% reflects the company's focus upon continuing to grow. This growth is likely to result in higher dividends.