recommended this stock
nearly two years ago it was paying a 14.4%yield .
In most cases, yields this high aren't safe.
But this company is different.
In short, it borrows money at very low interest rates, invests in
securities that pay high interest rates, and pockets the spread.
For many businesses, an operation like this comes with risk. But
like I said, this company is different: It ONLY invests in
securities that are backed by the U.S. government. And, thanks to a
unique law, the company is required to pay out 90% of anyprofit it
makes to its shareholders in the form of dividends.
In other words, at the time I recommended this stock, we were
looking at a rare opportunity to lock in a ridiculously high
with relatively little risk.
Since then, investors have piled into the stock like crazy
andshares have soared. The company I'm talking about is
Annaly Capital Management (NYSE:
-- and if you got in when I recommended, you'd be sitting on a 90%
Take a look…
Remarkably, about half of these gains have come from dividends.
Here's how it breaks down…
- When I recommended Annaly in March of 2009, it was selling
for $13.50 a share. By the end of the year, you would have
collected $2.54 in dividends for every share you owned. That's an
18.8% return -- in cash -- in about 10 months.
- If you held onto your
through 2010, you would have received another $2.65 a share in
dividends. That's an extra 19.6% cash return on your original
Add up your income from both 2009 and 2010 and you'd be looking
at a 38.4% return from dividends alone in less than two years.
Now here's where it gets interesting…
Even though Annaly's shares are trading about 33% higher than when
I first recommended them, based on the company's 12-month trailing
dividends, you can lock in a 14.5% yield if you buy this stock
Keep in mind, though, that like all dividend-paying stocks, there
are no guarantees. The company could cut itsdividend at any time
without any prior notice.
However, if history is any guide, Annaly could continue delivering
Sincegoing public in 1997, it's returned more than 900% and hasn't
missed a singledividend payment. On top of this, it still only
invests in securities backed by the U.S. government, and it's still
required to pay out 90% of its profits to its shareholders -- just
like it was when I first recommended it.
Action to Take -->
With its huge yield and relatively low risk, an investment in
Annaly today could be the easiest way to make a 14.5% return on
your money this year.
P.S. -- I don't know if you've seen this or not, but a Texas man
has figured out how to collect thousands of dollars a month in
dividend payments alone. Last year he made $41,161 this way.
Whether you're on a fixed income or not, I'm sure you could benefit
by copying this man's formula for your own use. Here's everything
you need to know…
Disclosure: Neither Andy Obermueller nor StreetAuthority, LLC
hold positions in any securities mentioned in this article.
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