Quiz time, sports fans: What did the New York Yankees of the '50s and the Chicago Bulls and Dallas Cowboys of the '90s have in common? (And exactly how can this help you with your portfolio?)
It wasn't just that they both had some of the best individual players of the time -- Mickey Mantle, Michael Jordan, and Emmitt Smith, respectively -- although that certainly helped. And it wasn't just that they were able to bring home world championship trophies on a regular basis. It was simply that their organizations and performances were consistently excellent.
Consistent excellence is rare anywhere, but imagine seeing it in your portfolio. Impossible? No way! Because that's what carefully chosen dividend-paying stocks can offer.
Build the next investing dynasty
Finding these long-haul outperformers can help you build your fortune, as studies from investing gurus such as Jeremy Siegel have shown time and time again. Finding them for you is precisely what we do at our Motley Fool Income Investor service.
France Telecom
Identify new talent
With that last thought in mind, I'd like to introduce you to our new community-intelligence database, Motley Fool CAPS. There, savvy investors help one another identify stocks that can create consistent and substantial growth for any type of investor. That means whether you're a Buffett-esque value investor or a chart-watching technical trader, you are welcome to strut your stuff. And, just as in professional sports, the cream inevitably rises to (and stays at) the top.
So what are the best dividend-paying stocks around, according to CAPS? Here are a few dividend picks with high CAPS ratings:
|
Company |
Yield |
|---|---|
|
Petroleo Brasileiro |
1.7% |
|
Diana Shipping |
6.2% |
|
Eagle Bulk Shipping |
6.4% |
|
PPL Corporation |
2.5% |
|
Ares Capital |
9.7% |
Stake your claim
I encourage you to join CAPS to learn more about why investors are so bullish on these companies, and perhaps to add your own thoughts to the system. I'll get you started with some thoughts about one company here that may be worth checking out: Eagle Bulk Shipping.
The hulking bulk demand
It's been a great year for dry bulk shipping stocks. Eagle's stock has shot up 77% over the past 12 months, Diana Shipping is up 138%, and DryShips has gained a scorching 720%.
Why all the excitement? Well, it's pretty straightforward. Companies like Eagle own giant ships that carry bulk commodities like iron ore, grain, and cement. Then they charter out these ships to shipping companies at market-determined charter rates. When demand for shipping bulk goods rises faster than new ships can be put into service, the charter rates for these ships rise.
Recent high demand for shipping commodities such as iron -- come forward and take a bow, China -- has outstripped the dry bulk shipping capacity. Charter rates have been at record highs. And management at Eagle isn't expecting it to come to an end soon. A recent article in Investor's Business Daily quoted Sophocles Zoullas, Eagle's CEO, as saying that demand due to infrastructure build-out in India should be a huge driver over the next few years.
Though Fools on CAPS have been fairly negative on DryShips in the past, they certainly haven't missed out on other dry bulk players like Eagle. CAPS player rjmiyake is one of those players, and expects these stocks to continue to move higher over the next three years, because -- very simply -- "demand is greater than [the] supply of ships."
You can check out who has been bullish on Eagle, as well as chime in with your own thoughts, by heading over to CAPS. You may also want to check out a few of the other top-rated dividend payers above while you're there.
And looping back around to conclude my (very) extended sports metaphor, allow me to suggest that dividend stocks will help you turn your portfolio into the dependable New York Yankees, rather than the flash-in-the-pan Florida Marlins. And if you hate the Yankees, it's probably because they're so darn good, so darn often.
