2020 Market Pullback Winners

Looking for dividend stocks which have outperformed during the 2020 pullback?
We found 3 stocks which have had positive returns since 2/20/20, when the market started falling.
Not surprisingly, 2 of the 3 are in the food industry, selling such long-lasting items as frozen veg and canned foods, but the 3rd one is a Tech REIT, which serves the biggest names on the internet.  While sheltering in place, greater internet usage and more frozen veg/canned food are definitely all on the table:

Con Agra Brands (CAG): Founded in 1919, CAG operates through Grocery & Snacks, Refrigerated & Frozen, International, Foodservice, and Pinnacle Foods segments. Some of its best-known brands are Birds Eye, Marie Callender’s, Banquet, Healthy Choice, Slim Jim, Reddi-wip, Vlasic, Angie’s BOOMCHICKAPOP, Duke’s, Earth Balance, Gardein, Frontera, Banquet,and Chef Boyardee.

Hormel Foods (HRL): Founded in 1891, HRL operates through 5 segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store, and International & Other. It offers various perishable meat products, including fresh meats, frozen items, refrigerated meal solutions, sausages, hams, guacamoles, and bacons; and shelf-stable products, such as canned luncheon meats, peanut butters, chilies, shelf-stable microwaveable meals, hashes, stews, meat spreads, flour and corn tortillas, salsas, tortilla chips, and other products. The company also provides turkey products; nutritional food products and supplements; dessert and drink mixes; and industrial gelatin products.

CoreSite Realty Corp.(COR): COR delivers secure, reliable, high-performance data center and interconnection solutions to a growing customer ecosystem across eight key North American markets. More than 1,350 of the world’s leading enterprises, network operators, cloud providers, and supporting service providers choose CoreSite to connect, protect and optimize their performance-sensitive data, applications and computing workloads.

2020 Pullback Performance:
CAG is up 8.63%; COR is up 4.71%; and HRL has gained 4.41% since the start of the 2020 market pullback, vs. -17.41% for the S&P 500 and -16.17% for the DJIA.  All 3 have also outperformed the major indexes by a wide margin since the July 2019 and Sept. 2018 market highs:

However, we don’t want to give you the impression that it was all smooth sailing for this group. Quite the contrary, they all dipped during the 2020 crash – CAG dipped the most, while COR and HRL had the strongest rebounds:


COR has the highest dividend yield of the group, at 4.04%, and should go ex-dividend near the end of April. HRL has the lowest yield, 1.96%, but is a Dividend Aristocrat, having raised its dividends for at least 25 straight years. COR and HRL have the best 5-year dividend growth rates of the group.
CAG yields 2.62%, but you can improve upon that yield quite a bit, by selling options.

Selling Options For More Income:
Selling Covered Calls is an increasingly popular way to ramp up your short or near term income on a dividend stock. With all of the extreme volatility in 2020, you have the benefit of selling at the highest options yields in years.
As of the week ending 4/9/20 close, CAG’s mid-May $34.00 call strike had a bid of $.80, almost 4X its $.21 quarterly dividend. The nominal yield is 3.11% in ~5 weeks, or 33.49% annualized.
You can see more details for this and many other high yield trades, including one for COR, on our free Covered Calls Table.

Selling Cash Secured Puts below a stock’s price offers you the attraction of a lower breakeven entry point. In essence, you’re getting paid to wait.
CAG’s mid-May $32.00 put strike pays $1.45, nearly 6X the $.21 dividend. The nominal yield is 4.46% in just ~5 weeks, or 48.64% annualized.

You can see more details for this Put-selling trade and many other high yield trades on our Cash Secured Puts Table.

Price Targets:
Selling cash secured puts below a stock’s price can come in handy when the stock is close to or past its average price target. Such is the case with CAG, which only 2.8% below its average $33.40 price target. COR and HRL are both above their respective price targets.

CAG and HRL both have P/E’s on the high side, due to their better-than-market performance. COR is a REIT, and uses Funds From Operations, FFO, as its earnings metric.

Disclaimer: This article was written for informational purposes only, and is not intended as personal investment advice. Please practice due diligence before investing in any investment vehicle mentioned in this article.

Stock Market News: 04-04-20

Economic News: “The March jobs report showed that 701,000 Americans lost their jobs last month, far exceeding estimates for around 83,0000. It was the first decline in payrolls since September 2010 and not far from the worst month of job losses during the 2007-09 recession.
The unemployment rate rose to 4.4% from 3.5%, but the unemployment picture is likely…Click here to read more…

Stock Market News: 3-14-20

Click here to learn how Selling Options can give you more downside protection and more income.
Market Indexes:
Thursday was the market’s worst day since 1987, with all sectors and assets selling off, including previous safe havens, such as gold and muni’s. “Wall Street clawed back some of the losses on Friday from its biggest declines in three decades, Click here to read more…

Stock Market News: 2-15-20

Click here to learn how Selling Options can give you more downside protection and more income.

Market Indexes: The market is reacting first and foremost to news about the corona virus, even more than to earnings releases and economic reports. This week was an up week, as fears about the virus’s spread appeared to wane, along with perceived economic fallout.
“China’s National Health Commission on Wednesday said 2015 new cases of the disease caused by the new viral infection had been reported over the last 24 hours, declining for a second day. That brought the number of cases in mainland China to 44,653, although experts have warned that a substantial number may have gone uncounted. The commission said there were 97 additional deaths from the virus in the last 24 hours, bringing the mainland total to 1,113.” (MarketWatch)
“Investors are edging back into emerging markets, even though worries about the coronavirus’ impact on global economic growth have clouded prospects for the boom-and-bust asset class. Nearly $730 million flowed back into emerging markets exchange-traded funds (ETFs) in the past week, according to Lipper, after two straight weeks of outflows that accompanied sharp declines in the stocks and currencies of developing countries.  As of Friday, the coronavirus has infected 63,581 people and killed 1,380. Still, investors have grown more hopeful that economic damage will be limited.” (Reuters)

This Week’s Options Trades: Looking for high yield covered call and high yield put-selling trades?
We added more high yielding options trades for high dividend stocks this week to our Public Cash Secured Puts Table and our Public Covered Calls Table.
Click here to read more…

2 Blue Chip Dividend Stocks Going Ex-Dividend Soon, With High Options Yields

by Robert Hauver
Looking for a safe way to increase your yields?
Our DoubleDividendStocks.com investing service has been specializing in combining options-selling with high dividend stocks since 2009.

Our Covered Calls Table features over 25 covered calls trades, which we update throughout each reading day. Two trades that caught our attention this week are for blue chip dividend stocks Boeing, (BA), and Intel, (INTC).

Both BA and INTC go ex-dividend in early August:  BA goes ex-dividend ~8/9/18, and INTC goes ex-dividend ~8/6/18. They both have conservative payout ratios, but a relatively low dividend yield.

Although neither one is in the realm of high divided stocks, you can make up for that, via selling covered calls. The August quarterly dividends make for an attractive setup for these covered call plays.
For BA, we chose a $365.00 call strike which is ~3% above its current $354.44 price/share. This call strike pays $5.20, with a tight bid/ask of $5.20/$5.30.
The $5.20 call option payout is ~3X BA’s quarterly $1.71 dividend. It transforms it from a ~7% annualized yield to a ~21% annualized yield, since the trade has just 25 days until it expires.

Here’s a breakdown of the 3 profitable scenarios for the BA trade. Since the $365.00 call strike is $10.56 above BA’s price/share, there’s ample compensation for potentially missing out on the quarterly $1.71 dividend, if the shares rise to $365.00 and get called away prior to the August ex-dividend date. We listed the nominal yields for each scenario:

The INTC trade is right at the money, with a $52.50 call strike, vs. INTC’s $52.30 price/share. The call bid of $1.44 is well over 4X INTC’s $.30 quarterly dividend.

Since both BA and INTC have had very strong price gains in the past year, and are fairly close to their 52-week highs, here’s another strategy to consider.
We’ve added these August put-selling trades to our Cash Secured Puts Table, which has over 30 trades that are updated throughout each trading day.
The August $345.00 BA put strike pays $6.40, which is well over 3X BA’s quarterly dividend, and offers a breakeven of $338.60.
The INTC August $50.00 put pays $.81, which is over 2X INTC’s $.30 quarterly dividend, and has a breakeven of $49.19.
There are plenty of other Put option and Call option strike prices you can choose from. As you get further away, (higher) from the underlying stock’s price/share, the call option bid premiums are lower in value. Conversely, lower put strikes don’t pay as much as those which are closer to the underlying stock’s price/share. One other note – put sellers don’t receive dividends.

As we noted above, both BA and INTC have had quite a price run over the past year – BA is up 68.77% and INTC is up 49.38%.

Price Targets:
At their current prices, both BA and ~12% below analysts’ consensus target prices.

That bodacious ROE figure for BA isn’t a typo – BA’s management has opted to use more debt than equity in financing its growth over the years. So, its ROE is very high, but its Debt/Equity ratio is also quite high, vs. industry averages.
Like BA, INTC has stronger than average ROA, ROE, and ROI figures, and also has a much better Operating Margin. Its Debt/Equity ratio is higher than industry averages, but not nearly as much as BA’s is.

All tables furnished by DoubleDividendStocks.com, unless otherwise noted.

Disclaimer: This article was written for informational purposes only, and is not intended as personal investment advice. Please practice due diligence before investing in any investment vehicle mentioned in this article.

Author owns no shares of BA or INTC at present time.
Copyright 2018 RH Group Inc. All Rights Reserved.

The Worst Stock Tickers In History

by Robert Hauver
In this article, we’ll take a quick April Fool’s stroll through the stock market’s most ridiculously named tickers. Even though this article comes in the spirit of April Fool’s Day, we didn’t make these names up, unbelievably enough, they’re actual stock market tickers.
Securities marketing at its finest, this is not.

WARNING: This article contains words which some readers my find offensive.

We recently came across what simply must be the worst-named ticker in securities history on Bloomberg. Believe it or not, a company actually voluntarily chose this ticker:

(Source: Bloomberg)

They changed it?! Really? But why?! Whatever reason could they possibly have had for making such a rash decision?! Click here to read more…

High Options Yields From A Blue Chip Mouse

Did you grow up watching Uncle Walt every Sunday night on the “wonderful World Of Disney”? Or maybe you had your own Mouseketeer hat?
These days, the Mouse hasn’t been getting much respect from Mr. Market, who has been acting like a house cat, with respect to Walt Disney co., (DIS), shares.

The problem is cord-cutting, and how it affects ESPN, one of Disney’s premier cable cash machines. As millennials opt out of bundled cable packages, ESPN has seen sales declines, and the price/share has struggled in the past year.
Click here to read more…