101 End-O-December 10%+ Yield Dividend WallStars Toast Tremendous Target Gains And A Merger

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Includes: AI, CVRR, GARS, LKSD, MMLP, NGL, OPI, SIR, SMLP, SRLP, SXCP, TCRD, TEO, USAC, VGR
by: Fredrik Arnold
Summary

WallStars all show positive broker target price upsides. 101 stocks displayed 10%+ forward yield, $5.00+ prices, and $100M+ market caps as of 12/31/18. Yields above 14.1% winnowed the list to 30.

WallStar target-estimated End-O-December top-ten net-gain estimates ranged 65.95%-454.33% for USAC; GARS, SXCP, SMLP, SRLP; CVRR, LKSD, TEO, SIR, and top pick, GOV.

30 Top stocks ranged in estimated annual yield from 14.14% to 27.72%. Top ten, NGL, VGR, TCRD, SRLP, MMLP, AI, SMLP, CVRR, GOV and topper, SIR averaged 20.89% yield.

Top-ten firms by WallStar target price upsides ENLK, GARS, SMLP, SXCP, CVRR, SRLP, LKSD, TEO, SIR, and top stock, GOV averaged a 127.78% estimated price gain.

$5k invested 12/31/18 in the lowest-priced five 10%+ top-yield dividend stocks showed 43.06% more net gain than from $5k in all ten. The low-price smaller WallStars dominated End-O-December's 10%+yield pack.

Source: YCharts

Actionable Conclusions (1-10): Brokers Calculate 65.95% To 454.33% Net Gains For Ten 10%+ Yield Stocks By End-O-December 2019

Five of ten top 10%+Yield WallStars were among the top ten gainers for the coming year (based on analyst 1-year targets). So, this forecast for 10%+ Yields, as graded by Wall St. Brokers, was 50% accurate.

Projections based on dividends from $1,000 invested in the highest yielding stocks and aggregate one-year analyst median target prices of those stocks, as reported by YCharts, created the 2019 data points. Note: one-year target prices from single analysts were not applied (n/a). Ten probable profit-generating trades to End-O-December 2019 were:

Government Properties REIT (GOV) was projected to net $4,543.32 based on dividends, plus a median of target estimates from seven brokers, less broker fees. The Beta number showed this estimate subject to volatility 52% over the market as a whole.

Select Income REIT (NYSE:SIR) netted $2,518.04 based on the median of target price estimates from four analysts, plus dividends less broker fees. The Beta number showed this estimate subject to volatility 172% more than the market as a whole.

NOTE: The above two stocks are now merged.

NEWTON, Mass. - (BUSINESS WIRE)

The Combined Company, "Office Properties Income Trust", will Begin Trading on the Nasdaq under the Ticker Symbol "OPI" on January 2nd.

Government Properties Income Trust Announces a Change to the Comparative Index for its Business Management Agreement

Government Properties Income Trust (GOV) today announced that it has completed its merger with Select Income REIT (SIR).

After the effective time of the merger, the combined company changed its name to "Office Properties Income Trust" and effected a 1-for-4 reverse split of its outstanding common shares such that every four common shares of the combined company will be converted into one common share of the combined company.

Telecom Argentina SA (TEO) was projected to net $1,216.22, based on target price estimates from ten analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to volatility 1% over the market as a whole.

LSC Communications Inc (LKSD) was projected to net $1,100.00, based on a median target price estimate from three analysts, plus dividends, less broker fees. A Beta number was not available for LKSD.

CVR Refining LP (CVRR) was projected to net $976.16, based on the median of target price estimates from seven analysts, plus the estimated annual dividend, less broker fees. The Beta number showed this estimate subject to volatility 66% more than the market as a whole.

Sprague Resources LP (SRLP) was projected to net $924.10, based on a median target price estimate from two analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to volatility 35% more than the market as a whole.

Summit Midstream Partners LP (SMLP) was projected to net $910.35, based on dividends, plus the median of target price estimates from ten analysts, less broker fees. The Beta number showed this estimate subject to volatility 58% over the market as a whole.

SunCoke Energy Partners LP (SXCP) was projected to net $850.30 based the median of target price estimates from four analysts, plus the estimated dividends, less broker fees. The Beta number showed this estimate subject to volatility 33% over the market as a whole.

Garrison Capital Inc (GARS) was projected to net $787.15, based on dividends, plus the median of target price estimates from seven analysts, less broker fees. The Beta number showed this estimate subject to volatility 51% less than the market as a whole.

USA Compression Partners LP (USAC) was projected to net $659.51 based the median of target price estimates from seven analysts, plus the estimated dividends, less broker fees. The Beta number showed this estimate subject to volatility 17% over the market as a whole.

The average net gain in dividend and price was estimated at 144.85% on $10k invested as $1k in each of these ten stocks. This gain estimate was subject to average volatility 32% more than the market as a whole.

Source: reneelouise21.wordpress.com

The Dividend Dogs Rule

Stocks earned the "dog" moniker by exhibiting three traits: (1) paying reliable, repeating dividends, (2) their prices fell to where (3) yield (dividend/price) grew higher than their peers. Thus, the highest yielding stocks in any collection became known as "dogs." More precisely, these are, in fact, best called, "underdogs".

101 10%+ Yield WallStars By Price Target Upsides

Source: YCharts

101 10%+ Yield WallStars By Yield

Source: YCharts

Actionable Conclusions (11-20): Ten Top 10%+ Yield WallStars By Sector

Top ten 10%+ Yield WallStars selected 12/31/18 by yield represented four of eleven Morningstar sectors.

Top stocks on the list were two in the real estate sector, Select Income REIT [1], was immediately followed by Government Properties Income Trust [2].

Five from the energy sector placed third, fourth, sixth, seventh, and tenth: CVR Refining LP (CVRR) [3]; Summit Midstream Partners LP (SMLP) [4]; Martin Midstream Partners LP (MMLP) [6]; Sprague Resources LP (SRLP) [7]; NGL Energy Partners LP (NGL) [10].

A pair of financial services representatives placed fifth and eighth, Arlington Asset Investment Corp (AI) [5], and THL Credit Inc (TCRD) [8].

Finally, a lone consumer defensive sector representative placed ninth, Vector Group Ltd (VGR) [9], to complete the 10%+ Yield WallStar top ten for End-O-December.

Actionable Conclusions: (21) Top Ten 10%+ Yield WallStars Showed 54.41% To 431.3% Upsides To End-O-December 2019; (22) Lowest Downside Was VGR at 0%.

Source: YCharts

To quantify top yield rankings, analyst mean price target estimates provided a "market sentiment" gauge of upside potential. Added to the simple high-yield metrics, analyst mean price target estimates became another tool to dig out bargains.

Analysts Cast A 43.06% Advantage For 5 Highest Yield, Lowest Priced 10%+ Yield WallStars To End-O-December 2019

Ten top 10%+ Yield WallStars were culled by yield for this pre-monthly update. Yield (dividend/price) results verified by Yahoo Finance did the ranking.

Source: YCharts

As noted above, top ten 10%+ Yield WallStars selected 12/31/18 showing the highest dividend yields represented four of eleven sectors in the Morningstar scheme.

Actionable Conclusions: Analysts Estimated 5 Lowest-Priced of Top Ten Highest-Yield 10%+WallStars (25) Delivering 174.48% Vs. (26) 121.96% Net Gains From All Ten By End-O-December 2019

Source: YCharts

$5,000 invested as $1k in each of the five lowest-priced stocks in the top ten 10%+ Yield WallStars collection was expected by analyst 1-year targets to deliver 43.06% more net gain than $5,000 invested as $.5k in all ten. The second lowest priced 10%+ top yield WallStar, Government Properties Income Trust, was projected by analysts to deliver the best net gain of 454.33%.

Source: YCharts

The five lowest-priced top 10%+ Yield stocks as of December 31 were: THL Credit Inc (TCRD); Government Properties Income Trust; Arlington Asset Investment Co (AI); Select Income REIT; NGL Energy Partners LP (NGL), with prices ranging from $6.08 to $9.59.

Five higher-priced 10%+ Dividend WallStars from December 31 were: Vector Group Ltd (VGR); Summit Midstream Partners LP (SMLP); Martin Midstream Partners LP (MMLP); CVR Refining LP (CVRR); Sprague Resources LP (SRLP), whose prices ranged from $9.73 to $14.49.

The distinction between five low-priced dividend dogs and the general field of ten reflected Michael B. O'Higgins' "basic method" for beating the Dow. The scale of projected gains based on analyst targets added a unique element of "market sentiment" gauging upside potential. It provided a here-and-now equivalent of waiting a year to find out what might happen in the market. Caution is advised, since analysts are historically only 20% to 80% accurate on the direction of change and just 0% to 20% accurate on the degree of change.

The net gain/loss estimates above did not factor in any foreign or domestic tax problems resulting from distributions. Consult your tax advisor regarding the source and consequences of "dividends" from any investment.

Stocks listed above were suggested only as possible reference points for your 10%+ Yield WallStar purchase or sale research process. These were not recommendations.

Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsement to buy or sell any security. Prices and returns on equities in this article except as noted are listed without consideration of fees, commissions, taxes, penalties, or interest payable due to purchasing, holding, or selling same.

Graphs and charts were compiled by Rydlun & Co., LLC from data derived from Indexarb; YCharts; Yahoo Finance; analyst mean target price by Thomson/First Call in Yahoo Finance. Dog photo: reneelouise21.wordpress.com

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.