Market Wrap-Up for Aug.3 (PG, DOW, COH, JCP, PFE, CVX, more)

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Many times, I'm asked how to compare the returns of dividend-paying stocks to what one can get in real estate investments.

One of the key things I always tell people is that if you are looking to be a landlord, it helps tremendously to be handy. Household devices break all the time, and if you have to keep bringing in contractors for repairs, there goes a big part of your margins. I have had various relatives and friends over the years tell me tales of being a landlord, and one thing is for certain, if it wasn't for the property values appreciating significantly before the real estate crash, the job of landlord is not one I'd want to have.

As we look ahead to where real estate is now, we are likely still years away from any sort of bottom. Reading a CNN Money article earlier today about condos selling for less than the price of cars, I was intrigued to examine further. Apparently, in Deerfield Beach, Florida, condos can be had for less than $25,000. A North Miami listing, about three miles from the beach, was priced at $23, 450. That 900-square foot, one-bedroom, one-and-a-half bath unit included a community swimming pool, central air and assigned parking. In Las Vegas, there are more than 200 condos listed for $30,000 or less. We're talking Time-Share prices basically.

What's my point? The point is yes, it is a good time if you are a buyer to scoop up bargains that are ridiculously low, but what that process will do to surrounding properties that need to comp out for appraisals is certainly not a good thing. I am still a bit worried about where the real estate market is headed, and I am hesitant to jump in on the "all-clear" banter from some in the real estate industry.

Dividend-paying stocks, in contrast to real estate, don't require upkeep, dealing with tenants, or a large capital outlay (20% cash required to get a mortgage is back in vogue). I know people have done well with real estate years ago, but what about going forward? After all, future results are all that matters for us as we sit here and evaluate where to disperse capital. If you check out our site and go to our dividend historical returns articles, you will see the case on why I see dividend-paying stocks as the way to go for the long-term.

Back to todays' markets, earnings results took down several dividend players this morning, including Procter & Gamble ( PG ) , Dow Chemical ( DOW ) , and Coach ( COH ) . Retail stocks suffered a bout of selling, with J.C. Penney ( JCP ) and Aeropostale ( ARO ) leading the way lower. Bucking the selling were names like Pfizer ( PFE ) - decent earnings results, Chevron ( CVX ) , and UnitedHealth Group ( UNH ) . Volume came in similar to yesterday's levels and continues to be something we are a bit concerned about.

We are continuing to evaluate further opportunities in the high-yield space and may have some new names we are considering adding to the recommended list. We will keep subscribers updated to any new changes we make.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Stocks

Referenced Stocks: ARO , COH , CVX , DOW , JCP , PFE , PG , UNH

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