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3 Big Dividend Stocks Yielding Over 8%; JMP Says ‘Buy’

3 Big Dividend Stocks Yielding Over 8%; JMP Says ‘Buy’

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From the end of March through the end of August, stocks had a tremendous runup to record high levels. The gains completely wiped out the losses from the mid-winter ‘coronavirus collapse,’ and it looked like we were in for a sustained run of good days. But all of that changed as September rang in. The market hit a bump, and has been undergoing a correction. The Nasdaq is down nearly 7%, and volatility has been high so far this month.

A new report from Canaccord's Tony Dwyer puts the situation into perspective by pointing out the major source of uncertainty: “In a true statement of the obvious,” he writes, “this is the most complicated election-year setup we could possibly have.” He goes on to note the four most important ‘unknown’ factors: how the voting will actually happen this year, and avoiding vote fraud; who will win the White House; if the Democrats will sweep the Federal level elections; and, if the loser will concede the contest without a dragged-out legal battle. These are points giving investors ulcers at night.

Dwyer balances all of that with the predictable factor: “Unlike the political backdrop, which is totally unpredictable, we know the Fed intends to keep rates at zero and to keep intervening when there are any signs of stress.” An active central bank will continue injecting liquidity into the system, which will be bullish for stocks. In Dwyer’s view, the only question is, what tools will the Fed use?

So, in a situation that recalls Donald Rumsfeld’s ‘unknown unknowns,’ many investors are gravitating toward defensive stocks, taking steps to ensure a steady income stream. And this brings them, quite naturally, to dividend stocks. These traditional defensive plays may not offer the high share appreciation that is so attractive in normal times, but their high-yielding dividends make up for that when things turn sideways.

With this in mind, analysts from JMP Securities have tapped three such defensive stocks, with dividend yields range from 8.5% to more than 12%. We’ve run the three through the TipRanks database to find out what makes them so compelling. Here are the results.

BlackRock TCP Capital (TCPC)

The first stock on our list is a financial company. BlackRock TCP Capital is a specialty finance company with a clear focus on mid-market lending. Since 1999, BlackRock has worked on originating and investing in debt securities, and has made a total of $20.1 billion in financing loans to more than 500 companies over the years. A plurality (over 34%) of the company’s investments are in the software and financial services fields, but BlackRock’s portfolio, current valued at $1.6 billion, spans a diverse field of targets.

The company’s investments are profitable; as of the end of Q2 this year, the average annual return was 9.8%. That income provides earnings that regularly beat the forecasts. As the recessionary pressures began to ease, Q2 earnings came in at 36 cents per share, or 20% higher than expected.

BlackRock uses these earnings to fund its dividend, which has been paid out regularly for more than 3 years. In a nod to the coronavirus crisis, the payment was cut from 36 cents to 30 cents – but at that level, BlackRock returns almost all of its earnings to company shareholders. The dividend yield is 12.1%, more than 6x higher than the average yield found among S&P listed companies – and more than 12x higher than the yield on US Treasury bonds in these days of near-zero interest rates.

JMP analyst Christopher York is cautiously bullish on TCPC, and one of the reasons he cites is the company’s solid cash position.

"The company has cash of ~$20.6mln and ~$328mln in availability on revolvers, which is more than enough to support any draw of unfunded commitments of $46.0mln. We think the liquidity at the company is very strong and think the resources at the advisor are superior to many BDCs, which we expect to lead to good longer-term restructuring and recovery outcomes,” York noted.

York rates this stock an Outperform (i.e. Buy) and his $11 price target implies room for 13% share price growth in the coming year. (To watch York’s track record, click here)

Overall, the analyst consensus rating here is a Moderate Buy, based on 3 Buys and 2 Holds. Shares are selling for $9.76 and the average price target matches York’s, at $11. (See BlackRock stock analysis on TipRanks)

PennyMac Mortgage (PMT)

Next up is another financial stock, PennyMac Mortgage. This company is a mortgage investment trust, a sub-niche of the real estate investment trust industry that provides somewhat more liquidity by investing primarily in mortgage backed securities rather than directly in real properties.

During the corona crisis of 1H20, PMT saw earnings turn negative in Q1 and return to positive territory in Q2. The numbers were -$5.99 EPS in the first quarter, and $4.51 in the second. Revenues followed a similar pattern, with the Q2 top line hitting $475 million.

The company adjusted its mortgage payments in the first half to account for the earnings volatility. PMT paid out 25 cents per common share in Q1, just slightly more than half of the long-held dividend of 47 cents. In Q2, management started raising the dividend, and paid out 40 cents per common share, which gives a yield 9.1%.

Trevor Cranston wrote the review of this stock for JMP, and sees the company with a path forward as the pandemic effects wane.

“[Our] outlook on MSRs has improved somewhat in the past few months as the expected negative COVID-19-related impact has subsided, and we continue to believe strength in the correspondent lending business is likely to more than offset any weakness in MSR results due to strong tailwinds for origination volumes, even as conventional margins have returned to more normalized levels," Cranston opined. “As a result, believe PMT shares should trade at a premium to the hybrid REIT peer group as many peers sold significant volumes of credit assets in late 1Q and early 2Q, resulting in less book value recovery potential.”

Along with these comments, he gives the stock a $19 price target, implying room for 9% upside growth. Cranston’s rating on the stock is Outperform, (i.e. Buy). (To watch Cranston’s track record, click here)

Overall, PMT holds a Moderate Buy analyst consensus rating based on 5 recent Buys and 2 Holds. The stock has an average price target of $19.40, slightly higher than Cranston’s, and indicative of a 11% upside potential. (See PMT stock analysis on TipRanks)

Oaktree Specialty Lending (OCSL)

Last up on this list, Oaktree, is another specialty finance company. Oaktree provides loans and credit access for small- to mid-size companies that cannot gain entry to traditional sources of capital. Oaktree’s portfolio is modestly diverse, with $1.4 billion invested in 128 companies. Most of this is first lien debt, 62%, while some 20% is made up of second lien.

Oaktree reported last month on its FYQ3 results, and the results were solid. EPS came in at 12 cents, against a forecast of 11 cents, for a 9% beat. Revenue for the fiscal third quarter was $34.4 million, even with forecast and down slightly yoy.

The earnings results suggest that the company is emerging from the corona crises intact, a thesis supported by management’s decision to raise the quarterly dividend. They have not raised the payout since mid-2018, when it was set at 10 cents per common share. The new dividend payment is 10% higher, at 11 cents, but while the numbers seem small, the yield is an impressive 8.5%.

Turning back to Christopher York, we find that the JPM analyst has set a $6 price target on OCSL, suggesting his belief in a 24% potential for the stock.

Backing his stance, York writes, “We think the combination of stability in portfolio performance in 2Q20, along with growth in the investment portfolio at wider spreads gave the board the necessary boost to finally increase the dividend with improved visibility in recurring core earnings. Going forward, we believe there are a couple levers available for OCSL to expand earnings and ROE, so we think another dividend increase in F2021 is possible.”

Of the three stocks on this list, Oaktree is the one with a Strong Buy analyst consensus rating – and it is unanimous. The stock has received 5 Buy reviews in recent weeks. The shares are priced at $4.83, and the $5.60 average price target implies an upside potential of 16% for the coming 12 months. (See OCSL 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.

Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

The post 3 Big Dividend Stocks Yielding Over 8%; JMP Says 'Buy' appeared first on TipRanks Financial Blog.

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Are Voters Recoiling Against Disorder?

Are Voters Recoiling Against Disorder?

Authored by Michael Barone via The Epoch Times (emphasis ours),

The headlines coming out of the Super…

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Are Voters Recoiling Against Disorder?

Authored by Michael Barone via The Epoch Times (emphasis ours),

The headlines coming out of the Super Tuesday primaries have got it right. Barring cataclysmic changes, Donald Trump and Joe Biden will be the Republican and Democratic nominees for president in 2024.

(Left) President Joe Biden delivers remarks on canceling student debt at Culver City Julian Dixon Library in Culver City, Calif., on Feb. 21, 2024. (Right) Republican presidential candidate and former U.S. President Donald Trump stands on stage during a campaign event at Big League Dreams Las Vegas in Las Vegas, Nev., on Jan. 27, 2024. (Mario Tama/Getty Images; David Becker/Getty Images)

With Nikki Haley’s withdrawal, there will be no more significantly contested primaries or caucuses—the earliest both parties’ races have been over since something like the current primary-dominated system was put in place in 1972.

The primary results have spotlighted some of both nominees’ weaknesses.

Donald Trump lost high-income, high-educated constituencies, including the entire metro area—aka the Swamp. Many but by no means all Haley votes there were cast by Biden Democrats. Mr. Trump can’t afford to lose too many of the others in target states like Pennsylvania and Michigan.

Majorities and large minorities of voters in overwhelmingly Latino counties in Texas’s Rio Grande Valley and some in Houston voted against Joe Biden, and even more against Senate nominee Rep. Colin Allred (D-Texas).

Returns from Hispanic precincts in New Hampshire and Massachusetts show the same thing. Mr. Biden can’t afford to lose too many Latino votes in target states like Arizona and Georgia.

When Mr. Trump rode down that escalator in 2015, commentators assumed he’d repel Latinos. Instead, Latino voters nationally, and especially the closest eyewitnesses of Biden’s open-border policy, have been trending heavily Republican.

High-income liberal Democrats may sport lawn signs proclaiming, “In this house, we believe ... no human is illegal.” The logical consequence of that belief is an open border. But modest-income folks in border counties know that flows of illegal immigrants result in disorder, disease, and crime.

There is plenty of impatience with increased disorder in election returns below the presidential level. Consider Los Angeles County, America’s largest county, with nearly 10 million people, more people than 40 of the 50 states. It voted 71 percent for Mr. Biden in 2020.

Current returns show county District Attorney George Gascon winning only 21 percent of the vote in the nonpartisan primary. He’ll apparently face Republican Nathan Hochman, a critic of his liberal policies, in November.

Gascon, elected after the May 2020 death of counterfeit-passing suspect George Floyd in Minneapolis, is one of many county prosecutors supported by billionaire George Soros. His policies include not charging juveniles as adults, not seeking higher penalties for gang membership or use of firearms, and bringing fewer misdemeanor cases.

The predictable result has been increased car thefts, burglaries, and personal robberies. Some 120 assistant district attorneys have left the office, and there’s a backlog of 10,000 unprosecuted cases.

More than a dozen other Soros-backed and similarly liberal prosecutors have faced strong opposition or have left office.

St. Louis prosecutor Kim Gardner resigned last May amid lawsuits seeking her removal, Milwaukee’s John Chisholm retired in January, and Baltimore’s Marilyn Mosby was defeated in July 2022 and convicted of perjury in September 2023. Last November, Loudoun County, Virginia, voters (62 percent Biden) ousted liberal Buta Biberaj, who declined to prosecute a transgender student for assault, and in June 2022 voters in San Francisco (85 percent Biden) recalled famed radical Chesa Boudin.

Similarly, this Tuesday, voters in San Francisco passed ballot measures strengthening police powers and requiring treatment of drug-addicted welfare recipients.

In retrospect, it appears the Floyd video, appearing after three months of COVID-19 confinement, sparked a frenzied, even crazed reaction, especially among the highly educated and articulate. One fatal incident was seen as proof that America’s “systemic racism” was worse than ever and that police forces should be defunded and perhaps abolished.

2020 was “the year America went crazy,” I wrote in January 2021, a year in which police funding was actually cut by Democrats in New York, Los Angeles, San Francisco, Seattle, and Denver. A year in which young New York Times (NYT) staffers claimed they were endangered by the publication of Sen. Tom Cotton’s (R-Ark.) opinion article advocating calling in military forces if necessary to stop rioting, as had been done in Detroit in 1967 and Los Angeles in 1992. A craven NYT publisher even fired the editorial page editor for running the article.

Evidence of visible and tangible discontent with increasing violence and its consequences—barren and locked shelves in Manhattan chain drugstores, skyrocketing carjackings in Washington, D.C.—is as unmistakable in polls and election results as it is in daily life in large metropolitan areas. Maybe 2024 will turn out to be the year even liberal America stopped acting crazy.

Chaos and disorder work against incumbents, as they did in 1968 when Democrats saw their party’s popular vote fall from 61 percent to 43 percent.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times or ZeroHedge.

Tyler Durden Sat, 03/09/2024 - 23:20

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Veterans Affairs Kept COVID-19 Vaccine Mandate In Place Without Evidence

Veterans Affairs Kept COVID-19 Vaccine Mandate In Place Without Evidence

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

The…

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Veterans Affairs Kept COVID-19 Vaccine Mandate In Place Without Evidence

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

The U.S. Department of Veterans Affairs (VA) reviewed no data when deciding in 2023 to keep its COVID-19 vaccine mandate in place.

Doses of a COVID-19 vaccine in Washington in a file image. (Jacquelyn Martin/Pool/AFP via Getty Images)

VA Secretary Denis McDonough said on May 1, 2023, that the end of many other federal mandates “will not impact current policies at the Department of Veterans Affairs.”

He said the mandate was remaining for VA health care personnel “to ensure the safety of veterans and our colleagues.”

Mr. McDonough did not cite any studies or other data. A VA spokesperson declined to provide any data that was reviewed when deciding not to rescind the mandate. The Epoch Times submitted a Freedom of Information Act for “all documents outlining which data was relied upon when establishing the mandate when deciding to keep the mandate in place.”

The agency searched for such data and did not find any.

The VA does not even attempt to justify its policies with science, because it can’t,” Leslie Manookian, president and founder of the Health Freedom Defense Fund, told The Epoch Times.

“The VA just trusts that the process and cost of challenging its unfounded policies is so onerous, most people are dissuaded from even trying,” she added.

The VA’s mandate remains in place to this day.

The VA’s website claims that vaccines “help protect you from getting severe illness” and “offer good protection against most COVID-19 variants,” pointing in part to observational data from the U.S. Centers for Disease Control and Prevention (CDC) that estimate the vaccines provide poor protection against symptomatic infection and transient shielding against hospitalization.

There have also been increasing concerns among outside scientists about confirmed side effects like heart inflammation—the VA hid a safety signal it detected for the inflammation—and possible side effects such as tinnitus, which shift the benefit-risk calculus.

President Joe Biden imposed a slate of COVID-19 vaccine mandates in 2021. The VA was the first federal agency to implement a mandate.

President Biden rescinded the mandates in May 2023, citing a drop in COVID-19 cases and hospitalizations. His administration maintains the choice to require vaccines was the right one and saved lives.

“Our administration’s vaccination requirements helped ensure the safety of workers in critical workforces including those in the healthcare and education sectors, protecting themselves and the populations they serve, and strengthening their ability to provide services without disruptions to operations,” the White House said.

Some experts said requiring vaccination meant many younger people were forced to get a vaccine despite the risks potentially outweighing the benefits, leaving fewer doses for older adults.

By mandating the vaccines to younger people and those with natural immunity from having had COVID, older people in the U.S. and other countries did not have access to them, and many people might have died because of that,” Martin Kulldorff, a professor of medicine on leave from Harvard Medical School, told The Epoch Times previously.

The VA was one of just a handful of agencies to keep its mandate in place following the removal of many federal mandates.

“At this time, the vaccine requirement will remain in effect for VA health care personnel, including VA psychologists, pharmacists, social workers, nursing assistants, physical therapists, respiratory therapists, peer specialists, medical support assistants, engineers, housekeepers, and other clinical, administrative, and infrastructure support employees,” Mr. McDonough wrote to VA employees at the time.

This also includes VA volunteers and contractors. Effectively, this means that any Veterans Health Administration (VHA) employee, volunteer, or contractor who works in VHA facilities, visits VHA facilities, or provides direct care to those we serve will still be subject to the vaccine requirement at this time,” he said. “We continue to monitor and discuss this requirement, and we will provide more information about the vaccination requirements for VA health care employees soon. As always, we will process requests for vaccination exceptions in accordance with applicable laws, regulations, and policies.”

The version of the shots cleared in the fall of 2022, and available through the fall of 2023, did not have any clinical trial data supporting them.

A new version was approved in the fall of 2023 because there were indications that the shots not only offered temporary protection but also that the level of protection was lower than what was observed during earlier stages of the pandemic.

Ms. Manookian, whose group has challenged several of the federal mandates, said that the mandate “illustrates the dangers of the administrative state and how these federal agencies have become a law unto themselves.”

Tyler Durden Sat, 03/09/2024 - 22:10

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Low Iron Levels In Blood Could Trigger Long COVID: Study

Low Iron Levels In Blood Could Trigger Long COVID: Study

Authored by Amie Dahnke via The Epoch Times (emphasis ours),

People with inadequate…

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Low Iron Levels In Blood Could Trigger Long COVID: Study

Authored by Amie Dahnke via The Epoch Times (emphasis ours),

People with inadequate iron levels in their blood due to a COVID-19 infection could be at greater risk of long COVID.

(Shutterstock)

A new study indicates that problems with iron levels in the bloodstream likely trigger chronic inflammation and other conditions associated with the post-COVID phenomenon. The findings, published on March 1 in Nature Immunology, could offer new ways to treat or prevent the condition.

Long COVID Patients Have Low Iron Levels

Researchers at the University of Cambridge pinpointed low iron as a potential link to long-COVID symptoms thanks to a study they initiated shortly after the start of the pandemic. They recruited people who tested positive for the virus to provide blood samples for analysis over a year, which allowed the researchers to look for post-infection changes in the blood. The researchers looked at 214 samples and found that 45 percent of patients reported symptoms of long COVID that lasted between three and 10 months.

In analyzing the blood samples, the research team noticed that people experiencing long COVID had low iron levels, contributing to anemia and low red blood cell production, just two weeks after they were diagnosed with COVID-19. This was true for patients regardless of age, sex, or the initial severity of their infection.

According to one of the study co-authors, the removal of iron from the bloodstream is a natural process and defense mechanism of the body.

But it can jeopardize a person’s recovery.

When the body has an infection, it responds by removing iron from the bloodstream. This protects us from potentially lethal bacteria that capture the iron in the bloodstream and grow rapidly. It’s an evolutionary response that redistributes iron in the body, and the blood plasma becomes an iron desert,” University of Oxford professor Hal Drakesmith said in a press release. “However, if this goes on for a long time, there is less iron for red blood cells, so oxygen is transported less efficiently affecting metabolism and energy production, and for white blood cells, which need iron to work properly. The protective mechanism ends up becoming a problem.”

The research team believes that consistently low iron levels could explain why individuals with long COVID continue to experience fatigue and difficulty exercising. As such, the researchers suggested iron supplementation to help regulate and prevent the often debilitating symptoms associated with long COVID.

It isn’t necessarily the case that individuals don’t have enough iron in their body, it’s just that it’s trapped in the wrong place,” Aimee Hanson, a postdoctoral researcher at the University of Cambridge who worked on the study, said in the press release. “What we need is a way to remobilize the iron and pull it back into the bloodstream, where it becomes more useful to the red blood cells.”

The research team pointed out that iron supplementation isn’t always straightforward. Achieving the right level of iron varies from person to person. Too much iron can cause stomach issues, ranging from constipation, nausea, and abdominal pain to gastritis and gastric lesions.

1 in 5 Still Affected by Long COVID

COVID-19 has affected nearly 40 percent of Americans, with one in five of those still suffering from symptoms of long COVID, according to the U.S. Centers for Disease Control and Prevention (CDC). Long COVID is marked by health issues that continue at least four weeks after an individual was initially diagnosed with COVID-19. Symptoms can last for days, weeks, months, or years and may include fatigue, cough or chest pain, headache, brain fog, depression or anxiety, digestive issues, and joint or muscle pain.

Tyler Durden Sat, 03/09/2024 - 12:50

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