Harry Domash maintains a variety of model portfolios that are each built around various income investing vehicles. In his industry leading newsletter, Dividend Detective, he reviews some recent new recommendations.
In our "ETF Growth Opportunities" portfolio, we are buying Global X YieldCo & Renewable Energy Income (YLCO), which holds income-generating renewable energy generators and other firms involved in the renewable energy industry. Global X — with a 3.5% yield — has returned 16% over the past 12 months and averaged 9.5% annually over three years.
In our "Closed-end Monthly Income" portfolio, we are recommending Cohen & Steers REIT & Preferred Income (RNP). This fund holds a 50/50 mix of REITs and debt instruments such as corporate bonds and preferred stocks. The fund, paying a 6.3% yield, has returned 27% over the past 12-months and averaged 12% annually over three years.
Among real estate investment trusts, we are adding Welltower (WELL), which owns 1,700+ healthcare properties in the US, the UK and Canada. Properties include skilled nursing, assisted living, independent living, and specialty care facilities leased to third-party operators, as well a medical office buildings.
Analysts are only forecasting 3% revenue growth and 4% FFO (cash flow) growth in 2020, but Welltower is actually growing much faster.
For instance, at the end of its June quarter, the value of its real estate portfolio was $31.1 billion, 21% above year-ago. Consequently, June quarter revenues rose 21% vs. year-ago. Thus, significant positive surprises are possible. The dividend yield is 3.9%.
In our portfolio of preferred stocks, we’re adding Braemar Hotels & Resorts Convertible Preferred Shares 5.50% Series B (BHR-B); these are cumulative preferreds. Braemar, formerly called Ashford Hospitality Prime, owns full-service luxury hotels and resorts.
Recently trading at $19.15 per share, the market yield is 7.2% and the appreciation potential, should these preferreds trade back up to their $25 call price, is 31%.
Please note that preferred stock ticker symbols are not standardized and you may have to use your broker’s symbol lookup function for Braemar. Look for something like BHR-PB or BHR.PRB.
