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Yahoo
31-05-2025
- Business
- Yahoo
Why CenterPoint Energy (CNP) is a Great Dividend Stock Right Now
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments. Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns. Based in Houston, CenterPoint Energy (CNP) is in the Utilities sector, and so far this year, shares have seen a price change of 16.96%. The energy delivery company is paying out a dividend of $0.22 per share at the moment, with a dividend yield of 2.37% compared to the Utility - Electric Power industry's yield of 3.27% and the S&P 500's yield of 1.56%. Taking a look at the company's dividend growth, its current annualized dividend of $0.88 is up 8.6% from last year. CenterPoint Energy has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 8.25%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Right now, CenterPoint's payout ratio is 55%, which means it paid out 55% of its trailing 12-month EPS as dividend. Looking at this fiscal year, CNP expects solid earnings growth. The Zacks Consensus Estimate for 2025 is $1.75 per share, representing a year-over-year earnings growth rate of 8.02%. Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. However, not all companies offer a quarterly payout. High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, CNP presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy). Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CenterPoint Energy, Inc. (CNP) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Associated Press
23-05-2025
- Business
- Associated Press
VistaShares Announces May 2025 Distributions for OMAH and QUSA ETFs
NEW YORK & SAN FRANCISCO & BOSTON--(BUSINESS WIRE)--May 23, 2025-- VistaShares, an innovative asset manager seeking to disrupt the status quo in thematic exposures, income investing, and more, is today announcing the May monthly distribution amounts for its VistaShares Target 15™ Berkshire Select Income ETF (OMAH) and VistaShares Target 15 ™ USA Quality Income ETF (QUSA). For more information and updates from VistaShares, please visit and follow the firm on LinkedIn @VistaShares and on X @VistaSharesETFs. Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus or summary prospectus with this and other information about the Fund, please call (844) 875-2288. Read the prospectus or summary prospectus carefully before investing. Investing involves risk, including possible loss of principal. Index / Strategy Risks. The Index's holdings are derived from publicly available data, which may be delayed relative to the then current portfolio of Berkshire Hathaway. Consequently, the Fund's holdings, which are based on the Index, may not accurately reflect Berkshire Hathaway's most recent publicly-disclosed investment positions and may deviate substantially from its actual current Portfolio. The equity securities represented in the Index are subject to a range of risks, including, but not limited to, fluctuations in Market conditions, increased competition, and evolving regulatory environments, all of which could adversely affect their performance. Focused Portfolio Risk. The Fund will hold a relatively focused portfolio that may contain exposure to the securities of fewer issuers than the portfolios of other ETFs. Holding a relatively concentrated portfolio may increase the risk that the value of the Fund could go down because of the poor performance of one or a few investments. Distribution Risk. Although the Fund has an annual income target, the Fund intends to distribute income on a monthly basis. There is no assurance that the Fund will make a distribution in any given month. Derivatives Risk. Derivatives are financial instruments that derive value from the underlying reference asset or assets, such as stocks, bonds, or funds (including ETFs), interest rates or indexes. Options Contracts Risk. The use of options contracts involves investment strategies and risks different from those associated with ordinary portfolio securities transactions. The prices of options are volatile and are influenced by, among other things, actual and anticipated changes in the value of the underlying instrument, including the anticipated volatility, which are affected by fiscal and monetary policies and by national and international political, changes in the actual or implied volatility or the reference asset, the time remaining until the expiration of the option contract and economic events. Equity Market Risk. Common stocks are generally exposed to greater risk than other types of securities, such as preferred stock and debt obligations, because common stockholders generally have inferior rights to receive payment from specific issuers. The equity securities held in the Fund's portfolio may experience sudden, unpredictable drops in value or long periods of decline in value. U.S. Government and U.S. Agency Obligations Risk. The Fund may invest in securities issued by the U.S. government or its agencies or instrumentalities. U.S. Government obligations include securities issued or guaranteed as to principal and interest by the U.S. Government, its agencies or instrumentalities, such as the U.S. Treasury. New Fund Risk. The Fund is a recently organized management investment company with no operating history. As a result, prospective Investors do not have a track record or history on which to base their investment decisions. Newer Sub-Adviser Risk. VistaShares is a recently formed entity and has limited experience with managing an exchange-traded fund, which may limit the Sub-Adviser's effectiveness. Foreside Fund Services, LLC, distributor. View source version on CONTACT: Chris Sullivan Craft & Capital [email protected] KEYWORD: UNITED STATES NORTH AMERICA MASSACHUSETTS CALIFORNIA NEW YORK INDUSTRY KEYWORD: PROFESSIONAL SERVICES OTHER PROFESSIONAL SERVICES INSURANCE FINANCE ASSET MANAGEMENT BANKING SOURCE: VistaShares Copyright Business Wire 2025. PUB: 05/23/2025 12:11 PM/DISC: 05/23/2025 12:11 PM
Yahoo
22-05-2025
- Business
- Yahoo
How Income Investors Can Use Options for Fun and Profit
INCOME INVESTING Income investors usually want to keep it simple, and stock options are anything but. They can still be a useful tool, however, especially when pondering the safety of a dividend. That's not the first thing that people typically think of when they contemplate stock options.
Globe and Mail
12-05-2025
- Business
- Globe and Mail
2 No-Brainer Dividend Stocks to Buy With $2,000 Right Now
Blue chip dividend stocks are usually considered stable long-term investments, but they lost their luster over the past few years as interest rates spiked. Rising rates made risk-free CDs and Treasury bills more appealing, while making it tougher for many companies to support their dividends with consistent profits. But as interest rates decline again, it might be smart to buy some of those blue chip dividend plays. So even if you only have $2,000 available to invest, you should consider buying and holding these two classic income stocks: American Express (NYSE: AXP) and Realty Income (NYSE: O). 1. American Express American Express is often considered a credit card company, but it's also one of the U.S.'s largest banks. Unlike Visa and Mastercard, which only issue co-branded cards instead of issuing any cards of their own, American Express is both a card issuer and its own bank. Its total number of active cards rose 4% to 123.3 million in 2024. Therefore, it generates its revenue from both card processing fees and interest payments on its outstanding loans. American Express controls a smaller slice of the global card-payments market than Visa and Mastercard, but that's an intentional business decision. Since it needs to back its own cards with its own balance sheet, it only issues them to lower-risk, higher-income individuals. The company is also better insulated from interest rate swings than Visa and Mastercard. Rising rates might curb consumer spending and credit card purchases, but they'll still boost its banking segment's net interest income. That balanced business model enabled American Express to grow its revenue and earnings per share (EPS) at compound annual growth rates (CAGRs) of 10% and 12%, respectively, from 2019 to 2024. From 2024 to 2027, analysts expect its revenue and EPS to have CAGRs of 8% and 13%, respectively. Those are rock-solid increases for a stock trading at 18 times forward earnings. The stock's forward dividend yield of 1.2% might seem low, but the company has raised its payout annually for 13 consecutive years. Its low payout ratio of 20% also gives it plenty of room for future dividend hikes. So if you're looking for an evergreen financial stock that offers an attractive mix of growth and income, American Express checks all the right boxes. 2. Realty Income Realty Income is one of the largest real estate investment trusts (REITs) in the world. REITs buy a lot of properties, rent them out, and split that rental income with their investors. They must also pay out at least 90% of their taxable income as dividends to maintain a lower tax rate. Realty Income owns a portfolio of 15,621 properties, which it leases to 1,565 different clients across more than 89 industries. It mainly focuses on recession-resistant retailers like drugstores, convenience stores, and discount retailers. Last year, its top tenants included Walgreens, 7-Eleven, Dollar General, and Dollar Tree, but no single tenant accounted for more than 3.5% of its annualized rent. And declining interest rates should make it cheaper for the REIT to purchase new properties. Some of its tenants have struggled with store closures in recent years, but the company's year-end occupancy rate still rose from 98.6% in 2023 to 98.7% in 2024. That figure has also never dropped below 96% since its initial public offering (IPO) in 1994. It can maintain that high occupancy rate because its stronger tenants are still expanding as its weaker ones contract. Realty Income pays its dividends every month instead of every quarter and has raised its payout 130 times since its IPO. It pays a forward annual dividend of $3.22 per share, which equals a yield of 5.7%. It expects its adjusted funds from operations (AFFO) to rise from a range of 0.7% to 2.1%, to a range of $4.22 to $4.28 per share this year, and easily cover those dividend payments. It also looks like a bargain at 13 times the midpoint of its estimated AFFO this year. That high yield, low valuation, and evergreen business model all make Realty Income an easy stock to recommend in this turbulent market. Should you invest $1,000 in American Express right now? Before you buy stock in American Express, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and American Express wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $614,911!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $714,958!* Now, it's worth noting Stock Advisor 's total average return is907% — a market-crushing outperformance compared to163%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of May 5, 2025
Forbes
11-05-2025
- Business
- Forbes
How To Own Preferred Stock And Collect 7%+ Each Year
Stock market blackboard concept getty While vanilla income investors limit their search to mere 'common' dividends, we contrarians know where the real payout party is at—with preferred stock divvies. Let's talk about three preferred-stock vehicles that pay from 6.9% to 9.4%. All three of these funds dish monthly dividends. And these payouts receive preferential treatment over common-stock dividends, making them safer than the common payouts offered by regular ol' equities. There are four main ways to buy preferreds, and three of them have some serious headaches and drawbacks: CEFs really do outperform their ETF 'benchmark.' Consider this chart of three preferred-stock CEFs versus iShares Preferred and Income Securities ETF (PFF)—all three CEFs boast better returns than the popular PFF: CEFs Outperform Ycharts Of course preferred CEFs aren't perfect. Fees are higher. The use of leverage makes preferreds swing more drastically than ETFs and mutual funds. And when preferreds heat up, CEFs can actually trade at a premium to NAV, which can drag on performance if we buy in at the wrong time. That all said, CEFs are generally the easiest and most effective way for us to buy preferreds. Now let's talk about the three that pay up to 9.4% in monthly divvies. I want to start with a 'hybrid' preferred fund: the John Hancock Premium Dividend Fund (PDT). PDT is technically an allocation fund (stock plus fixed income), split roughly 50/50 between preferred stocks and dividend-yielding common stocks. It's a brilliant idea—combining two great income tastes—that I'm surprised isn't more prevalent in ETF-land, where they can build an index and launch a product overnight. Not that I'd trust an index with this kind of portfolio. John Hancock's team of capital and credit managers have built a pretty tight portfolio of around 125 holdings. Utilities, which are directly stated as part of the fund's strategy, make up the vast majority of common-stock holdings. Financials make up the bulk of the preferred allocation—a surprise to no one familiar with preferred portfolios. Top holdings include high-yielding commons from telecoms AT&T (T) and Verizon (VZ), as well as utilities like Duke Energy (DUK) and BP (BP), but also preferreds like a 7.56% series from Citizens Financial. PDT has historically beaten up on plain-vanilla preferred ETFs like the iShares Preferred and Income Securities ETF (PFF). Of course it has. Not only does it have the benefit of owning some traditional equities, but management also uses a high amount of leverage (34% currently), which lets it make even more out of bull markets. Perhaps more surprising is its performance against pure high-yield common-dividend-stock funds: PDT Total Returns Ycharts The tradeoff, as the chart clearly shows, is volatility. Whereas basic preferred funds are often held to stabilize portfolios, John Hancock's fund's equity holdings and leverage are more geared toward performance than comfort. Fortunately, PDT actually delivers that performance, making it worthy of a look—especially when it trades at a discount to NAV, which it does right now. A 6% sale on PDT's assets might not sound like much, but over the past five years, the CEF has traded at a premium on average. Traditionalists will lean more toward funds such as the Flaherty & Crumrine Dynamic Preferred and Income Fund (DFP), which is as straightforward a preferred CEF as we could ask for. DFP holds about 250 positions, nearly 80% of which are issues from financial-sector firms. This is also a 'global' fund, split about 70 domestic/30 international, so in addition to preferreds from the likes of Citigroup (C) and Morgan Stanley (MS), we also get exposure to preferreds from Lloyds Banking (LYG) and Banco Santander (SAN). Management is more than happy to take some hard swings, too. About half of the portfolio is below-investment-grade, and DFP juices performance and yields further with nearly 40% debt leverage. Flaherty & Crumrine's preferred CEF also offers the best headline pricing of the bunch, at an 8% discount to NAV. And like with PDT, it's also a relative bargain compared to its five-year average discount, which sits around 2%. Most preferred stocks are perpetual in nature. They don't have expiration dates, and thus duration isn't usually necessary when evaluating preferred-stock funds. First Trust Intermediate Duration Preferred & Income Fund (FPF) is different, aiming for a portfolio duration of between three and eight years (and currently sits near five). If we back out the emphasis on duration, FPF looks an awful lot like a regular preferred CEF. Financials command a clear majority of assets. It's not afraid to shy away from international preferreds, which make up more than 40% of assets (Canada alone accounts for 15%). Leverage is high, at 34%. Dividends are high, at nearly 10%. Those dividends come each and every month. Two things about FPF that stand out more than anything? On the upside, First Trust's CEF has pretty great credit quality, with about two-thirds of assets in investment-grade preferreds. Another 15% or so is in BB+, the highest junk tier. Sure, that's why FPF, while better than PFF, hasn't performed as well as the prior two funds. But it's also why FPF boasts the lowest volatility of the three (as measured by beta) over every meaningful time period. On the downside, we're getting a 'phantom' sale on FPF right now. It currently trades at a 5% discount to NAV, but over the past five years, it has actually traded at a 6% discount on average. Brett Owens is Chief Investment Strategist for Contrarian Outlook. For more great income ideas, get your free copy his latest special report: How to Live off Huge Monthly Dividends (up to 8.7%) — Practically Forever. Disclosure: none
