What makes it so hard to understand what investors should do for the next 50 years is that we have an extremely hard time imagining possibilities that far into the future.
Look back at the differences between 1966 and today. Technology and societal trends are changing so fast that anyone transported from that time to today would barely comprehend the things we have done in this relatively short time.
For investors, though, this is where some of the greatest gains can be made, by buying and holding companies with rock-solid competitive advantages that will stand the test of time.
So we put the challenge of finding stocks that look to be great investments over the next 50 years. Here's what we find...
Despite the outsized gains by the bond proxy sectors this year, which include telecoms, utilities and real estate investment trusts (REITs), one of those sectors still trades cheap to the S&P 500.
While utilities trade at 17.3 times estimated 2016 earnings and REITs at 18.8, telecoms trade at a low 13.8 times, which is far below the S&P 500 at 16.6%.
In addition, the telecoms have been hit by waves of profit-taking, which have knocked them down into a range that looks inviting.
In an interesting note, RBC makes the case that while the bond proxy stocks are definitely at a premium, as a group they trade in line with the S&P 500.
While acknowledging that they may be more susceptible to rising rates, the firm also cites investor appetite for them when yields remain low, which they could for some time.
We screened for quality telecom stocks that pay solid and dependable dividends. These four look very attractive now.
Here are the results...
Looking for some income in your portfolio? Even growth-oriented investors can appreciate dividend stocks and the payouts they provide, even if that cash is ultimately earmarked for the purchase of growth stocks.
With bonds still paying next to nothing despite the Federal Reserve’s plans to start ratcheting up interest rates, dividend stocks are the only viable way to drive cash flow at a level that at least keeps pace with inflation.
It’s not a look that should be taken lazily, mind you. Sometimes a dividend yield is high simply because a stock has fallen in anticipation that its dividend will soon be cut.
On the other hand, sometimes a yield is strong because the market proverbially threw the baby out with the bathwater. Even the names that have fallen due to fears of a reduced dividend, however, can sometimes make for worthy speculations.
The situation doesn’t become clear until a particular company is scrutinized. Whatever the case, to help investors get their search for income started, here’s a closer look at the 18 large caps with single-digit P/E multiples and dividend yields over 4 percent.
These are the results...
Despite all of the volatility we've seen in the market this year, from the global sell-off in January and February to the drop in the markets following the Brexit vote, the S&P 500 is up mid to high single digits.
While not all stocks have recovered – plenty of healthcare and financial services stocks are still trading lower than they were at the start of the year – many have rallied.
Several sectors that have traditionally been associated with yield and/or safety – like utilities and consumer defensive – have been bid up in the process.
Searching for yield in this type of environment can be fraught with risks, from price risk to the risk that a firm cannot meet its dividend commitment, which weighs on investors' minds.
It's definitely not easy to find real bargains and higher yielding stocks with low or calculable risks. Attached I've listed my screening results of stocks with a solid risk/reward ratio.
Each of the stocks pay a solid dividend, have shown a great past performance and offering operational upside potential.
These are the stocks...
Dividends and safety are an excellent combination for long-term investors, and safe stocks with high dividends are the best kind of all. Unfortunately, many high-paying stocks are volatile and risky -- the exact opposite of what long-term investors want.
To help you sort through all of your options, four of our contributors would like to tell you about dividend-paying dividend stocks that will let you sleep soundly at night.
My main criteria are the beta ratio. The financial market ratio compares the stock volatility with the broader market. Is the stock more volatile or risky, the ratio exceeds the magic number one.
Attached you will find a couple of stocks with the longest dividend growth history and lowest beta ratios on the market, a value below 0.50. Each of the presented stocks are had half of the market volatility.
These are the highest yielding results in detail...
