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3 Big Dividend Stocks Yielding Over 11%; JMP Says ‘Buy’

3 Big Dividend Stocks Yielding Over 11%; JMP Says ‘Buy’

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There’s a gloomy mood, as investors see COVID-19 rates increasing again after moves to reopen the economy. In an atmosphere like this it’s only natural to take defensive moves to protect the portfolio, and moves like that will naturally draw investors toward dividend stocks. These are the classic defensive stocks, and for good reason: a reliable dividend keeps the income flowing, no matter what the markets do. And in today’s environment, with share prices pushed down by the economic reaction to the coronavirus, it’s possible to find sky-high dividend yields.

But not all dividend stocks are created equal. JMP analysts have chimed in – and they are recommending high-yield dividend stocks for investors looking to find protection for their portfolio.

Using TipRanks database, we’ve pulled up the details on some of JMP's recommendations. These are stocks with a specific set of clear attributes, that frequently indicate a strong defensive profile: a high dividend yield, over 11%; a Moderate Buy consensus view; and a considerable upside potential — over 10%. So let’s take a closer look at three of Oppenheimer’s picks.

Ellington Residential Mortgage (EARN)

We’ll start with a REIT, a real estate investment trust. Due to a quirk of tax regulation, REITs are perennial dividend champs, and Ellington Residential Mortgage is no exception. The company buys, manages, and invests in real assets and mortgage-related securities, focusing primarily on residential mortgage-backed security packages with backing guaranteed by the US government.

EARN reported a Q1 EPS of 27 cents, a sequential drop from the end of 2019. Company management put the falloff in income to the general chaos of the financial sector during the coronavirus pandemic, but credited an orderly portfolio reduction with preventing a forced sale of assets. On a positive note, EARN ended Q1 with $59.7 million in cash on hand.

A strong liquidity position allowed the company to maintain its dividend payments. EARN has a long history of both keeping up the payments, and adjusting them when needed to keep them in line with earnings. The current dividend, at 28 cents per share quarterly, was declared earlier this month. The annualized rate, of $1.12, gives a yield of 11.4%, far higher than the ~2% found among S&P-listed companies. This will be the fifth quarter in a row that the dividend has been held steady.

Covering this stock for JMP, analyst Mikhail Goberman writes, "[W]e continue to believe this best-in-class micro-cap agency MREIT should be trading much closer to its book value and at a premium to its peers, we reiterate our Market Outperform rating and adjust our price target slightly to $11.00, or 0.92x current estimated book value." Goberman's price target implies an upside of 13% from current levels. (To watch Goberman’s track record, click here)

The analyst consensus on EARN is an even split, with 1 Buy rating and 1 Hold rating set recently. The Buy is more recent, and so the stock gets a Moderate Buy overall. Shares are selling for $9.72, and the average price target of $10.50 suggests a one-year upside of 8%. (See EARN stock analysis on TipRanks)

Arbor Realty Trust (ABR)

Next up is another small-cap player in the mortgage industry. Arbor Realty specializes in making loans for multi-family developments – apartment complexes. The company is a major funder of Fannie Mae and Freddie Mac small loans, with over $30 million in such made in June so far. Arbor boasted that it created a $2 million rental assistance program to help families impacted by the COVID-19 epidemic.

Arbor reported 31 cents in Funds from Operations (FFO) in Q1, which was enough to keep up the common share dividend of 30 cents. This dividend has been increased steadily – albeit with a blip at the end of 2018 – for the past three years. The $1.20 annualized payment gives ABR's dividend a yield of 13.3%, an impressive 6.5x higher than the average dividend yield – and more than 13x higher than the current yields on Treasury bonds. With the history of dividend growth, ABR’s payment is a clear incentive for investors.

On an important financial note, Arbor closed a $40 million senior note offering in April. The notes are due in 2023, and the proceeds were used to pay down secured debt and shore up liquidity.

JMP’s Steven DeLaney noted the liquidity as one factor in Arbor’s solid position when he wrote, “We believe Arbor offers an attractive opportunity in this environment as any concerns over multifamily loan servicing advances have largely been addressed, and the steady performance and outlook for its Agency multifamily business should generate consistent earnings, while the company deals with credit issues in its Structured bridge loan portfolio. Additionally, following the April $40M senior note offering, liquidity stood at ~$350M…”

DeLaney’s $10 price target on ABR comes with an 13% upside potential, and supports his Buy rating for the stock. (To watch DeLaney’s track record, click here)

Arbor Realty shares are currently selling for $8.85. The average price target, at $10.75, implies a healthy upside of 21% from that level, even more bullish than DeLaney suggests. Both of the recent reviews on ABR are Buys, making the consensus view a Moderate Buy. (See ABR stock analysis on TipRanks)

Capstead Mortgage Corporation (CMO)

Last up is a residential mortgage REIT. Texas-based Capstead invests in a portfolio of adjustable rate residential mortgage securities, issued and backed by US government agencies, mainly Fannie Mae and Freddie Mac.

Capstead has been able to keep earnings positive during the ‘corona quarter,’ and even saw a sequential gain in core earnings EPS, from 15 cents in Q4 to 16 cents in Q1. The Q1 result was based on $19.8 million in reported core earnings. In a positive note for investors, Capstead kept operating costs low, just 1.22% of long-term capital.

The quarterly results, despite a fall-off in mortgage repayment rates during the pandemic, supported the company dividend, which was paid out in Q1 at 15 cents per share and declared earlier this month for Q2 at the same rate. This is the third quarter in a row that the dividend has held steady at 15 cents per share, and the payment has been increased steadily since the end of 2018. The annualized payment is 60 cents per common share, and gives the stock a dividend yield of 11.2%.

Writing on CMO for JMP, Steven DeLaney sees a clear path forward for the company: “[We] believe CMO shares are now well-positioned to benefit from a sustained period of low interest rates that should lead to a higher dividend in time and should command an improved valuation as the better-managed agency MREITs move up to the 0.90-1.10x BV valuation range in a more favorable operating environment with less interest rate volatility.”

DeLaney’s Buy rating on Capstead is supported by his $6 price target, which suggests an upside of 10% for the coming year. (To watch DeLaney’s track record, click here)

Overall, Capstead is another Moderate Buy stock, with 2 recent reviews from Wall Street’s analysts both rating the stock a Buy. Shares are priced at $5.35, almost in the penny-stock range, and the average price target matches DeLaney’s at $6. (See Capstead stock analysis on TipRanks)

To find good ideas for dividend stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

The post 3 Big Dividend Stocks Yielding Over 11%; JMP Says ‘Buy’ appeared first on TipRanks Financial Blog.

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Spread & Containment

War, peace and security: The pandemic’s impact on women and girls in Nepal and Sri Lanka

The impacts of COVID-19 must be incorporated into women, peace and security planning in order to improve the lives of women and girls in postwar countries…

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Nepalese girls rest for observation after receiving the Moderna vaccine for COVID-19 in Kathmandu, Nepal. (AP Photo/Niranjan Shrestha)

Attention to the pandemic’s impacts on women has largely focused on the Global North, ignoring countries like Nepal and Sri Lanka, which continue to deal with prolonged effects of war. While the Nepalese Civil War concluded in 2006 and the Sri Lankan Civil War concluded in 2009, internal conflicts continue.

As scholars of gender and war, our work focuses on the United Nations Security Council Resolution 1325 on women, peace and security. And our recently published paper examines COVID-19’s impacts on women and girls in Nepal and Sri Lanka, looking at policy responses and their repercussions on the women, peace and security agenda.

COVID-19 has disproportionately and negatively impacted women in part because most are the primary family caregivers and the pandemic has increased women’s caring duties.

This pattern is even more pronounced in war-affected countries where the compounding factors of war and the pandemic leave women generally more vulnerable. These nations exist at the margins of the international system and suffer from what the World Bank terms “fragility, conflict and violence.”

Women, labour and gender-based violence

Gendered labour precarity is not new to Nepal or Sri Lanka and the pandemic has only eroded women’s already poor economic prospects.

Prior to COVID-19, Tharshani (pseudonym), a Sri Lankan mother of three and head of her household, was able to make ends meet. But when the pandemic hit, lockdowns prevented Tharshani from selling the chickens she raises for market. She was forced to take loans from her neighbours and her family had to skip meals.

Some 1.7 million women in Sri Lanka work in the informal sector, where no state employment protections exist and not working means no wages. COVID-19 is exacerbating women’s struggles with poverty and forcing them to take on debilitating debts.

Although Sri Lankan men also face increased labour precarity, due to gender discrimination and sexism in the job market, women are forced into the informal sector — the jobs hardest hit by the pandemic.

Two women sit in chairs, wearing face masks
Sri Lankan women chat after getting inoculated against the coronavirus in Colombo, Sri Lanka, in August 2021. (AP Photo/Eranga Jayawardena)

The pandemic has also led to women and girls facing increased gender-based violence.

In Nepal, between March 2020 and June 2021, there was an increase in cases of gender-based violence. Over 1,750 incidents were reported in the media, of which rape and sexual assault represented 82 per cent. Pandemic lockdowns also led to new vulnerabilities for women who sought out quarantine shelters — in Lamkichuha, Nepal, a woman was allegedly gang-raped at a quarantine facility.

Gender-based violence is more prevalent among women and girls of low caste in Nepal and the pandemic has made it worse. The Samata Foundation reported 90 cases of gender-based violence faced by women and girls of low caste within the first six months of the pandemic.

What’s next?

While COVID-19 recovery efforts are generally focused on preparing for future pandemics and economic recovery, the women, peace and security agenda can also address the needs of some of those most marginalized when it comes to COVID-19 recovery.

The women, peace and security agenda promotes women’s participation in peace and security matters with a focus on helping women facing violent conflict. By incorporating women’s perspectives, issues and concerns in the context of COVID-19 recovery, policies and activities can help address issues that disproportionately impact most women in war-affected countries.

These issues are: precarious gendered labor market, a surge in care work, the rising feminization of poverty and increased gender-based violence.

A girl in a face mask stares out a window
The women, peace and security agenda can help address the needs of some of those most marginalized. (AP Photo/Niranjan Shrestha)

Policies could include efforts to create living-wage jobs for women that come with state benefits, emergency funding for women heads of household (so they can avoid taking out predatory loans) and increasing the number of resources (like shelters and legal services) for women experiencing domestic gender-based violence.

The impacts of COVID-19 must be incorporated into women, peace and security planning in order to achieve the agenda’s aims of improving the lives of women and girls in postwar countries like Nepal and Sri Lanka.

Luna KC is a Postdoctoral Researcher at the Research Network-Women Peace Security, McGill University. This project is funded by the Government of Canada Mobilizing Insights in Defence and Security (MINDS) program.

Crystal Whetstone does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

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Government

CDC Announces Overhaul After Botching Pandemic

CDC Announces Overhaul After Botching Pandemic

After more than two years of missteps and backpedaling over Covid-19 guidance that had a profound…

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CDC Announces Overhaul After Botching Pandemic

After more than two years of missteps and backpedaling over Covid-19 guidance that had a profound effect on Americans' lives, the Centers for Disease Control (CDC) announced on Wednesday that the agency would undergo a complete overhaul - and will revamp everything from its operations to its culture after failing to meet expectations during the pandemic, Bloomberg reports.

Director Rochelle Walensky began telling CDC’s staff Wednesday that the changes are aimed at replacing the agency’s insular, academic culture with one that’s quicker to respond to emergencies. That will mean more rapidly turning research into health recommendations, working better with other parts of government and improving how the CDC communicates with the public. -Bloomberg

"For 75 years, CDC and public health have been preparing for Covid-19, and in our big moment, our performance did not reliably meet expectations," said Director Rochelle Walensky. "I want us all to do better and it starts with CDC leading the way.  My goal is a new, public health action-oriented culture at CDC that emphasizes accountability, collaboration, communication and timeliness."

As Bloomberg further notes, The agency has been faulted for an inadequate testing and surveillance program, for not collecting important data on how the virus was spreading and how vaccines were performing, for being too under the influence of the White House during the Trump administration and for repeated challenges communicating to a politically divided and sometimes skeptical public."

A few examples:

Walensky made the announcement in a Wednesday morning video message to CDC staff, where she said that the US has 'significant work to do' in order to improve the country's public health defenses.

"Prior to this pandemic, our infrastructure within the agency and around the country was too frail to tackle what we confronted with Covid-19," she said. "To be frank, we are responsible for some pretty dramatic, pretty public mistakes — from testing, to data, to communications."

The CDC overhaul comes on the heels of the agency admitting that "unvaccinated people now have the same guidance as vaccinated people" - and that those exposed to COVID-19 are no longer required to quarantine.

Tyler Durden Wed, 08/17/2022 - 12:22

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Economics

Why Is No One at Nike Working This Week?

And will the move gain broader acceptance among American employers?

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And will the move gain broader acceptance among American employers?

You go into an office, pull at the door and find that it doesn't give and nobody's there. 

It may sound like the start of the common rushing-to-the-office-on-a-Saturday nightmare but, more and more, collective time off is being embraced by employees as part of a push for a better work culture.

While professional social media platform LinkedIn  (MSFT) - Get Microsoft Corporation Report and dating app Bumble  (BMBL) - Get Bumble Inc. Report had already experimented with collective time off for workers, the corporate ripples truly began with Nike  (NKE) - Get Nike Inc. Report.

In August 2021, the activewear giant announced that it was giving the 11,000-plus employees at its Oregon headquarters the week off to "power down" and "destress" from stress brought on by the covid-19 pandemic.

"In a year (or two) unlike any other, taking time for rest and recovery is key to performing well and staying sane," Matt Marrazzos, Nike's senior manager of global marketing science, wrote to employees at the time.

Nike Is On Vacation Right Now

The experiment was, not exactly unexpectedly, very well-received — a year later, the company instituted its second annual "Well-Being Week." Both the corporate headquarters in Beaverton, Ore., and three Air Manufacturing design labs with over 1,500 employees are closed for a collective paid vacation from Aug. 15 to 19.

"We knew it would be impactful, but I was blown away by the feedback from our teammates [...]," Nike's Chief Human Resources Officer Monique Matheson wrote in a LinkedIn post.

"Because everyone was away at the same time, teammates said they could unplug – really unplug, without worrying about what was happening back at the office or getting anxiety about the emails piling up."

Shutterstock/TheStreet

Of course, the time off only applies to corporate employees. To keep the stores running and online orders fulfilled but not exacerbate the differences between blue and white collar workers, Nike gave its retail and distribution employees a week's worth of paid days off that they can use as they see fit.

Nike has tied the change to its commitment to prioritize mental health. In the last year, it launched everything from a "marathon of mental health" to a podcast that discusses how exercise can be used to manage anxiety and depression.

Rippling Through the Corporate World?

But as corporations are often criticized for turning mental health into positive PR without actually doing much for employees, the collective week off was perhaps the most significant thing the company did for workers' mental health.

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The practice of set office closures has long been common practice in many European countries. In France, not only corporate offices but even restaurants and retail stores empty out over the month of August for what is culturally considered sacred vacation time. 

But as American work culture prioritizes individual choice and "keeping business going" above all else, the practice has been seen as radical by many corporate heads and particularly small businesses that may find it more difficult to have such a prolonged drop in business. 

But in many ways, the conversations mirror some companies' resistance to remote work despite the fact that one-fourth of white-collar jobs in the U.S. are expected to be fully remote by 2023

"This is the kind of perk that makes employees want to stay," industry analyst Shep Hyken wrote in a comment for RetailWire. "And knowing they can’t completely shut the entire company down, I like the way they are compensating the distribution and retail store employees."

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