Timber – A High Yield Asset That Never Stops Growing – May 27, 2009

Who says that money doesn’t grow on trees? Did you know that timber was one of the ONLY assets that appreciated in 2008?

Just take a look at the high dividend stocks in the diversified timber REIT sub-industry, and you might just might launch into a verse of Monty Python’s “Lumberjack Song”…

One Timber Reit that comes up in a screen for high dividend yields is Potlatch Corp., (PCH).

A metric that investors use when analyzing timber companies is the

amount of acres/share. At Potlatch’s current price of $26.77, you get approximately 38-39 acres/share, plus you get the rest of the business for free.

You can juice PCH’s high dividend yield even further, by selling January 2010 covered calls, essentially earning an extra, or “double dividend”.

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