Stock Market News: 09-26-20


Click here to learn how Selling Options can give you more downside protection and more income.
Market Indexes: It was the 4th straight down week for the market, with only the NASDAQ making a gain. Small caps took it on the chin – the Russell 2000 lagged, falling -4.49%, and continues to trail the other 3 indexes by a wide margin so far in 2020.

“Wall Street’s main indexes hit their lowest in nearly 7 weeks on Monday as concerns about fresh coronavirus-driven lockdowns and the inability of Congress to agree on more fiscal stimulus raised fears about another hit to the domestic economy. Click here to read more…

8-15-20 Stock Market News

FOREX: The US $ fell vs. most major currencies this week, except for the Yen and the NZ $.. “The dollar dropped on Friday, falling for 8 straight weeks, as investors looked to other currencies whose economies are currently outperforming that of the United States in terms of managing the coronavirus pandemic.”
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Stock Market News: 8-10-19

“Late Sunday, China let the yuan breach the key 7-per-dollar level for the first time in more than a decade and announced it was halting its purchases of U.S. agricultural products, halting a global rally which had pushed benchmark indexes in the United States and China up more than 20% for the year to date. 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.

Options:
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.

Performance:
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.

Financials:
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.

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

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…

Tech Dividend Stocks With High Options Yields

by Robert Hauver
Who are the winners so far in 2017? We looked at sectors from a variety of angles – trailing valuations, future earnings valuations, dividend yield, and performance, to see which sectors have outperformed, and which ones hold the most promise for the future.

Not surprisingly, Tech was a clear winner in Performance- it leads all other sectors so far in 2017:

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2 Dividend Aristocrats With Room To Run

by Robert Hauver
Looking for dividend stocks with a long term record of dividend increases? The S&P Dividend Aristocrats index contains 50 such stocks, all of which have increased their dividends paid per share yearly for the past consecutive 25 years.
This group contains many household names across various industries – some of the largest companies on the planet. Here are the top 15 companies, sorted by market cap. Healthcare giant Johnson & Jonson, (JNJ), tops the list, followed by Exxon Mobil, (XOM), after which the market cap drops to the mid-$200B range, with Procter & Gamble, (PG), Walmart, (WMT), and AT&T, (T):

The sector breakdown shows Consumer Staples as the leading weighted sector in the index by far, with a 26% weighting, followed by Industrials, with 17.4%, and Healthcare, with 13.4%: Click here to read more…

2 Undervalued Healthcare High Dividend Stocks

by Robert Hauver
Looking for bargains in the high dividend stocks universe? You may want to check out Omega Healthcare Investors, (OHI), and Medical Properties Trust, (MPW), 2 Healthcare REIT’s which have lagged the market in 2017, due to the uncertainty surrounding potential healthcare legislation changes in the US.
There may be uncertainty, but let’s remember something – there are 10,000 Baby Boomers retiring every day in the US, which will keep ramping up demand for healthcare facilities for many years to come. In fact, we’ve seen some forecasts which call for Healthcare to eventually reach 20% of GDP in the US.
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