2 Large Continental Stock getting 10% yield; RBC says ‘Buy’
Rising commodity prices, increased federal stimulus, and rising government bond yields all raise the profile of inflation. Moreover, there is a growing concern that stocks – and tech ones in particular – now have values that are separated from reality. Is there a change in macro climate to reverse the bull market? Too early to tell, but it turns out that a more prudent approach to investing could be a good move right now. And that brings us to stock stocks. Investors want a pad, something to protect their portfolio in case a market falls, and shares offer just that. These profit-sharing payments to stockholders provide a steady income stream, which typically remains reliable even in a recession. RBC Capital analysts have been doing some of the footwork for us, identifying stocks that pay off shares that have maintained high yields, just over 10%. Opening the TipRanks database, we examine the details behind these payments to find out what else makes these stocks a strong buy. Annaly Capital Management (NLY) First, Annaly Capital Management is a property investment trust (REIT). Annaly has a portfolio of commercial properties with a heavy focus on retail outlets (31%) and office space (29%). Other major investments include multi-purpose accommodation, hotels and healthcare buildings. The company has more than $ 100 billion in total assets. In the company’s 4Q20 results, Annaly showed an economic return of 5.1% for Q4, much stronger than the 1.8% reported for 2020 as a whole. EPS came in at 60 cents per common share, and more than covered the regular quarterly allowance of 22 cents. This is the third quarter in a row with the proportion at that level; at the annual rate of 88 cents per standard installment, the share yields 10.7%. This is head and shoulders above the ~ 2% yield found among peer companies in the financial sector. Annaly has a long history of adjusting her allowance payment to match earnings, making her a reliable payer. Also interesting to investors, Annaly ended Q4 with $ 8.7 billion in unlimited funds, including cash on hand. The company used this deep pocket to allow a $ 1.5 billion common stock repurchase program, in an effort to return capital to shareholders and strengthen share prices. RBC 5-star analyst Kenneth Lee is pleased with what he sees in Annaly’s performance, writing, “We continue to favor Annaly’s diverse operating model, strong liquidity and skew portfolio. MBS group attack amid a conventional macro background … Annaly is open to growth targeting, credit funds, including residential and commercial mortgage credit and middle market loans. We believe that diversification should allow NLY to move between attractive investment opportunities. “Based on these comments, Lee estimates NLY as the Outperform (ie Buy), along with a $ 9.50 price target. This figure represents a 14% upside for the coming year.” Lee ‘s history, click here) Overall, Wall Street has broad agreement on the quality of NLY, as evidenced by the 7 to 1 split among analyst reviews, favoring Buy over Hold and giving the stock a Strong Buyer analyst consensus level The shares are currently trading for $ 8.22 and their average price target of $ 9 suggests an upside potential of 9.5% from that level. (See NLY stock analysis on TipRanks) Sunoco LP (SUN) From REITs we move into the energy industry. Sunoco LP is the largest wholesale distributor of motor fuel in the US, and it supplies more than 7,300 Sunoco gas stations in 33 states.The company’s products include gasoline, diesel fuel, oil heating, jet fuel, lubricating oil, and kerosene – a full range of petroleum products, sold as both branded and unbranded products. Sunoco also controls 13 depots that maintain secure supply for delivery to retailers. At the point of sale, Sunoco delivers equipment to gas stations – from pumps to payment services. This company’s diversified business has allowed Sunoco to remain profitable due to the corona pandemic crisis. EPS came in negative in Q1, when demand fell at the height of the crisis, but recovered sharply in Q2 and has shown year – over – year gains in every quarter since. Q4 EPS was at 77 cents, up from 75 cents in the fourth year ago. The cash flow circulated in the quarter was down year over year, from $ 120 million to $ 97 million, and the company announced a quarterly share of 82.5 cents per common share. This has been held steady from the previous quarter – and indeed, it has been stable at this level since November 2016. Sunoco has been paying a reliable dividend for the past 8 years. The standard annual payment is $ 3.30 per installment, yielding 10.6%. Covering SUN for RBC, analyst Elvira Scotto notes that recent Arctic storm patterns in the U.S. continent have adversely affected sales volumes but it remains unchanged. motivation by other sides. “SUN continued its lead in 2021 and noticed an improvement in numbers in January. We do not expect recent weather to have a significant impact on SUN 2021 volumes, ”said the 5-star analyst. “We believe SUN reflects current investment income with a better balance sheet. We expect SUN to continue the broadcast and we expect the broadcast to improve over time. “Scotto ranks SUN outperform (ie Buy) and has increased its price target from $ 36 to $ 38. The figure means 23% upside down for the next 12 months. to give Scotto history, click here) Overall, Buy shares are at the Medium Buy level from the analyst consensus, based on a range of reviews including 5 Buys, 2 Holds, and 1 Sell. The shares have an average price target of $ 33.50, which gives a potential upside of 8% from the current trading price of $ 31. (See SUN stock analysis on TipRanks) To find good ideas for stock stock trading at valuations attractive, visit TipRanks’ Best Stocks to Buy, a recently launched tool that unites all TipRanks fairness views.Disclaimer: The ideas expressed in this article are just that the opinions of the emerging analysts for informational purposes only. It is very important to do your own analysis before making any investment.