Stocks again fluctuated up and down last week, with the end result being modest losses on most of the major averages, the exception being the New York Composite Index, which ended the week slightly ahead of where it finished a week earlier. Earnings season is now well under way, and the reaction of the market to reports, good or not so good, can cause volatility to be higher than usual.

Stocks on my lists going ex-dividend next week are listed following. There are more than shown the past couple of weeks. The stocks and/or CEFs, ex-dividend dates, and yields, as of Friday’s close, are as indicated below:

Main Street Capital (MAIN), 10/28/2020, 8.19%. MAIN pays monthly.

AGNC Investment (AGNC), 10/29/2020, 10.30%. AGNC also pays monthly.

Enterprise Products Partners LP (EPD), 10/29/2020, 10.11%.

Plains All American Pipeline LP (PAA), 10/29/2020, 10.56%.

Hoegh LNG Partners LP (HMLP), 10/29/2020, 13.56%.

Alliant Energy (LNT), 10/29/2020, 2.68%.

STAG Industrial (STAG), 10/29/2020, 4.40%. STAG pays monthly.

Unilever (UL), 10/29/2020, 2.97%.

Realty Income (O), 10/30/2020, 4.67%. O pays monthly.

ONEOK (OKE), 10/30/2020, 12.24%.

Kinder Morgan (KMI), 10/30/2020, 8.22%.

Omega Healthcare Investors (OHI), 10/30/2020, 8.84%.

Paychex (PAYX), 10/30/2020, 2.92%.

One of the fifteen CEFs I follow will be going ex-dividend on the first trading day of November, and another likely will as well, either then or a day or two later.

First Trust Intermediate Duration Preferred & Income Fund (FPF), 11/02/2020, 7.03%. FPF pays monthly.

AllianceBernstein Global High Income Fund (AWF) has not announced yet, but the expected ex-dividend date is also 11/02/2020, or shortly after. AWF yields 7.51%, and pays monthly.

Earnings season is now well under way. Firms on my lists that will be reporting next week are presented below, by reporting date.

10/26/2020

AGNC Investment (AGNC), PotlatchDeltic (PCH).

10/27/2020

3M Co (MMM), Ares Capital (ARCC), Crestwood Equity Partners LP (CEQP), Pfizer (PFE), ONEOK (OKE).

10/28/2020

Diebold Nixdorf (DBD), Entergy (ETR), Enterprise Products Partners LP (EPD), General Electric (GE), United Parcel Service (UPS), Annaly Capital Management (NLY), Mid-America Apartment Communities (MAA), Welltower (WELL). Note that DBD and GE are on my Tier4 list, no longer recommended. DBD has suspended their dividend, and GE pays a whopping penny per share per quarter.

10/29/2020

Kellogg (K), Medical Properties Trust (MPW), Newmont Mining (NEM), Royal Dutch Shell (RDS.B), Sanofi (SNY), Southern Co (SO), B&G Foods (BGS), Covanta Holding (CVA), Digital Realty Trust (DLR), Hercules Capital (HTGC), Omega Healthcare Investors (OMI), Washington Real Estate Investment Trust (WRE).

10/30/2020

Altria (MO), Chevron (CVX), Colgate Palmolive (CL), Exxon Mobil (XOM), Magellan Midstream Partners LP (MMP), Pitney Bowes (PBI), Public Services Enterprise Group (PEG).

Upgrades, downgrades, initiations or resumptions of coverage, and reiterations of ratings, as reported by E*Trade last week on my stocks, were as follows:

Kimco Realty (KIM) was upgraded from UnderPerform to Inline at Evercore ISI.

Unilever (UL) was resumed at Buy at Deutsche Bank.

Hershey Co (HSY) was initiated at Buy at Citigroup.

AT&T (T) and Verizon (VZ) were both initiated at Peer Perform at Wolfe Research. I guess Wolfe doesn’t want to play favorites between these two telecom giants.

Chevron (CVX) was resumed at OutPerform at Credit Suisse.

Brookfield Renewable Partners LP (BEP) was resumed at Neutral at Credit Suisse.

Occidental Petroleum (OXY) was downgraded from Buy to Hold at Truist.

Enterprise Products Partners LP (EPD) was initiated at Equal Weight at Capital One.

MPLX LP (MPLX) was initiated at OutPerform at Wolfe Research.

Getty Realty (GTY) was upgraded from UnderWeight to Neutral at JP Morgan.

Intel (INTC) was downgraded from Neutral to UnderPerform at Bank of America. I dropped INTC some time ago because of too low of a yield. But INTC laid an egg Friday, dropping $6 on a disappointing earnings report. If it drops further, pushing the yield above 3%, I will reinstate INTC to my Tier2 list. I don’t believe INTC is going away anytime soon, and a tech stock with a decent yield would be good to add to a diversified dividend portfolio.

Phillip Morris (PM) was downgraded from Buy to Hold at Argus.

AT&T (T) was reiterated at Neutral at Credit Suisse.

Intel (INTC) was reiterated at Market Perform at Cowen. 

The markets will likely fluctuate in place until after the election. My personal opinion is the market is taking the prospect of a Democrat sweep too lightly, based upon the stated goals of the Democrat Party. The Wall Street consensus seems to be that it doesn’t matter who wins, stocks will do well in 2021. Either way, like most Americans, I’ll be glad when the election is over, I’m sick and tired of it all.

JT

1st Posting for Week Beginning Monday 10/19/2020

Posted Sunday 10/18/2020 07:00 AM

Stocks fluctuated up and down last week, with the end result being the major averages finished slightly up for the week, but just barely. Supposedly the fact that another round of stimulus spending is stalled in Congress caused the market to effectively go nowhere. I guess that is as good an excuse as any. The political wars continued unabated, with accusations of biased open house participants to censoring of unfavorable news (for the Dems) by not only the news media, but also by the social media giants Twitter and Facebook.

Another slow week is in store for stocks on my lists going ex-dividend. The stocks and/or CEFs, ex-dividend dates, and yields, as of Friday’s close, are as indicated below:

Horizon Technology Finance (HRZN), 10/19/2020, 9.00%. HRZN pays monthly.

Gladstone Investment (GAIN), 10/22/2020, 8.33%. GAIN also pays monthly.

Procter & Gamble (PG), 10/22/2020, 2.20%.

Colgate Palmolive (CL), 10/22/2020, 2.19%.

Three of the fifteen CEFs I follow will be going ex-dividend next week. All three are monthly payers.

CBRE Clarion Global Real Estate Income Fund (IGR), 10/19/2020, 9.97%.

Eaton Vance Tax-Managed Diversified Equity Income Fund (ETY), 10/22/2020, 9/14%.

Miller Howard High Income Equity Fund (HIE), 10/22/2020, 7.69%.

It’s that time of the quarter again, earnings season has begun, as some of the early-reporting firms on my lists will be reporting next week, as listed by date below.

10/20/2020

Phillip Morris (PM), Procter & Gamble (PG).

10/21/2020

NextEra Energy (NEE), Verizon (VZ), Crown Castle International (CCI), Kinder Morgan (KMI).

10/22/2020

American Electric Power (AEP), AT&T (T), Coca Cola (KO), Freeport McMoRan (FCX), Kimberly Clark (KMB), Nucor (NUE), Intel (INTC).

Upgrades, downgrades, initiations or resumptions of coverage, and reiterations of ratings, as reported by E*Trade last week on my stocks, were as follows:

Greif (GEF) was upgraded from Market Perform to OutPerform at BMO Capital.

Pepsico (PEP) was upgraded from Neutral to Buy at Citigroup.

Cisco Systems (CSCO) was downgraded from Buy to Neutral at Citigroup.

Freeport McMoRan (FCX) was also downgraded from Buy to Neutral at Citigroup.

Pfizer (PFE) was downgraded from OverWeight to Neutral at Mizuho.

Procter & Gamble (PG) was reiterated at Buy at Jeffries.

Exxon Mobil (XOM) was upgraded from Sell to Neutral at Goldman.

Mid America Apartment Communities (MAA) was upgraded from Hold to Buy at Jeffries.

Park Hotels (PK) was upgraded from Market Perform to OutPerform at BMO Capital.

Kinder Morgan (KMI) was upgraded from Sell to Neutral at Goldman.

NuStar Energy LP (NS) was upgraded from Equal Weight to OverWeight at Barclays. 

Duke Energy (DUK) was downgraded from OutPerform to Neutral at Credit Suisse.

Nucor (NUE) was downgraded from OutPerform to Neutral at Exane BNP Paribas.

ONEOK (OKE) was downgraded from Neutral to Sell at Goldman.

Williams Cos (WMB) was downgraded from Buy to Neutral at Goldman.

HealthPeak Properties (PEAK) was downgraded from Buy to Neutral at Mizuho.

Kimberly Clark (KMB) was downgraded from OverWeight to Neutral at JP Morgan.

NGL Energy Partners LP (NGL) was downgraded from Neutral to Sell at UBS.

Welltower (WELL) was downgraded from Buy to Neutral at Mizuho.

Kimberly Clark (KMB) was initiated at Buy at Berenberg.

Realty Income (O) was initiated at Buy at UBS.

Spirit Realty Capital (SRC) was initiated at Sell at UBS. Apparently UBS does not see SRC becoming the new Realty Income (O).

Emerson Electric (EMR) was initiated at OverWeight at Stephens.

I will reiterate that I report these as being of interest, not as actionable advice. For one thing, the ratings focus almost entirely on the expectations for near-term price movements, not on the total return value, including dividends, over an extended period.

The near-term outlook for the markets overall is for more of the same, by which I mean prices will fluctuate, with no major change in either direction, at least for the near term. The expectations of a catastrophic decline caused by a constitutional crisis from a deadlocked election with massive fraud charges has receded somewhat. It now seems far-fetched, but it could still happen. I recommend being ready for just about anything, and keeping some “dry powder” available (in the form of investible cash), just in case some terrific bargains become available in the 4^th quarter.  

JT

Stocks rebounded last week after a slow start to October the prior week, with all the major averages showing gains for the first full week of October. The breaking news from last week that the President had Covid is now apparently in the rear view mirror, as the President responded to treatment and has been pronounced no longer contagious. The fact that treatment was possible is a testament to how far we have come in the last several months, from “nothing can be done” to “numerous possible therapies to try”, and I’m surprised the Administration doesn’t seem to be taking any credit for this change in circumstances, which was only possible because of the government’s “full-on” support.

The week ahead is shaping up to be another lackluster week for firms on my lists going ex-dividend, with the exception of my monthly-paying CEFs, eight of which will be going ex-dividend. The stocks and/or CEFs, ex-dividend dates, and yields, as of Friday’s close, are as indicated below:

Mid-America Apartment Communities (MAA), 10/14/2020, 3.20%. Apartment REITs have held up well so far in this Covid crisis.

Oxford Square Capital (OXSQ), 10/15/2020, 16.60%. OXSQ is the successor to TICC Capital. The high yield is compliments of a major drop in the stock price. Owned since 2015, I’m not actually that far away from break-even on this loser of a stock, considering cumulative dividends, which illustrates the benefit of high dividends, if they can be sustained for any length of time.

Horizon Technology Finance (HRZN), 10/19/2020, 9.32%. HRZN pays monthly. I originally bought HRZN in 2016, and collected high dividends, and also call premiums from selling covered calls, until it was called away in 2019. At that point I realized a net gain on 100 shares, including cumulative dividends, of $146, plus kept a call premium of $169. I re-entered HRZN in 2019, and I am ahead even without counting cumulative dividends received. I’ve resisted the urge to sell a covered call on it thus far, but that may change if call premiums become attractive again.

I missed Cisco Systems (CSCO) last week, which went ex-dividend 10/1/2020. CSCO yields 3.62%, which is quite generous for a technology stock.

Of the fifteen CEFs I track, eight will be going ex-dividend this coming week, and a ninth one likely will also, but the ex-dividend date has not been announced yet. All of these CEFs are monthly payers.

BlackRock Debt Strategies Fund (DSU), 10/14/2020, 8.48%.

BlackRock Enhanced Equity Dividend Trust (BDJ), 10/14/2020, 8.04%.

Cohen & Steers MLP Income & Energy Opportunity Fund (MIE), 10/13/2020, 10.59%. MLPs are mostly concentrated in the energy sector, which has been punished severely since even before the Covid crisis.

Cohen & Steers Quality Income Realty Fund (RQI), 10/13/2020, 8.25%.

Nuveen Real Asset Income and Growth Fund (JRI), 10/14/2020, 10.14%.

Gabelli Utility Trust (GUT), 10/15/2020, 7.85%.

Gabelli Dividend & Income Trust (GDV), 10/15/2020, 6.91%.

BlackRock Energy and Resources Trust (BGR), 10/14/2020, 11.59%. BGR is another down energy fund.

CBRE Clarion Global Real Estate Income Fund (IGR) is the fund that hasn’t yet announced, but it will likely go ex-dividend 10/19/2020 or thereabouts. IGR yields 9.55%, assuming the same payout as last month.

Only one of my stocks will be reporting earnings next week, Johnson & Johnson (JNJ), on 10/13/2020.

Upgrades, downgrades, initiations or resumptions of coverage, and reiterations of ratings, as reported by E*Trade last week on my stocks, were as follows:

ONEOK (OKE) was upgraded from Equal Weight to OverWeight at Wells Fargo.

AT&T (T) was downgraded from Sector Weight to UnderWeight at KeyBanc.

Park Hotels (PK) was initiated at Neutral at Compass Point.

McDonalds (MCD) was reiterated at Buy at Bank of America. BofA must be counting on the fact that no one has ever lost money by betting on American’s continuing to make terrible dietary choices.  

3M Co (MMM) was upgraded from UnderPerform to Hold at Gordon Haskett.

Phillip Morris was upgraded from Neutral to Buy at Citigroup.

Paychex (PAYX) was upgraded from Neutral to Buy at Citigroup.

Brookfield Renewable Partners LP (BEP) was downgraded from OverWeight to Equal Weight at Wells Fargo. While BEP is outperforming mightily, a look at the stock chart tells me that now is the time to sell and take profits, if you are fortunate enough to own it and acquired it some time ago when it was more reasonably priced.

Realty Income (O) was upgraded from Sector Perform to Sector OutPerform at Scotiabank.

General Electric (GE) was resumed at Buy at Goldman.

The political noise is drowning out nearly all other news these days as we enter the home stretch to November 3^rd. There are numerous disaster scenarios being put forth as possibilities regarding the outcome, or possibly the lack of an outcome. While I wouldn’t say there is no reason to worry, history says this, too, shall pass, eventually. To me, the best plan is to keep up with events, keep plenty of dry powder (i.e., investible cash), and take advantage of opportunities that appear.

JT

Stocks finished out the month of September last week with a gain for the three days that wrapped up September, but then mostly stalled as the week ended with the first two days of October. Just when it seemed our politics couldn’t get any worse, it got worse, as the President is now undergoing treatment for the Coronavirus, it was learned Friday. It is well known that the market doesn’t like uncertainty, and now we have even more uncertainty than ever. September was a down month for the market, and October may be more of the same.  

Only four stocks on my lists will be going ex-dividend next week. The firms, ex-dividend dates, and yields, as of Friday’s close, are as indicated below:

General Mills (GIS), 10/08/2020, yield 3.26%.

Universal (UVV), 10/08/2020, yield 7.37%.

Verizon (VZ), 10/08/2020, yield 4.22%.

AT&T (T), 10/08/2020, yield 7.30%.

None of the fifteen CEFs I track will be going ex-dividend next week.

Only one of my stocks will be reporting next week, Paychex (PAYX), on 1//6/2020.

Upgrades, downgrades, initiations or resumptions of coverage, and reiterations of ratings, as reported by E*Trade last week on my stocks, were as follows:

Chevron (CVX) was upgraded from Neutral to Buy at Bank of America.

United Parcel Service (UPS) was upgraded from Sector Weight to OverWeight at KeyBanc.

Hershey (HSY) was upgraded from Market Perform to OutPerform at BMO Capital.

ONEOK (OKE) was upgraded from Neutral to Buy at USB.

Park Hotels (PK) was upgraded from UnderPerform to Buy at Bank of America. With the dividend non-existent and the outlook for the leisure and travel industry being what it is, I have to wonder about this upgrade. But no doubt PK is available just now at a bargain price.

GlaxoSmithKline (GSK) was initiated at Buy at Berenberg.

Pfizer (PFE) and Sanofi (SNY) were both initiated at Hold at Berenberg.

Pan American Silver (PAAS) was upgraded from Hold to Buy at Deutsche Bank.

PotlatchDeltic (PCH) was upgraded from OutPerform to Strong Buy at Raymond James.

Duke Energy (DUK) was downgraded from Sector OutPerform to Sector Perform at Scotia Bank.

Realty Income (O) was initiated at OutPerform at Raymond James.

Spirit Realty Capital (SRC) was also initiated at OutPerform at Raymond James.

This political season, not to mention the Covid restrictions, cannot end soon enough. I think I can safely say that is the sentiment of most people just now. Neither is going away anytime soon, and for those who say at least the election season will be over soon, I would say don’t be too sure. If it is very close and there are voting irregularities, we may see a contentious post-election dogfight unlike anything seen in modern times in this country. Reviewing some of our election history from the 1800’s shows it wasn’t always so automatic that an election outcome was ceded so quickly after the voting was finished. That is probably the major concern of the market, rather than who wins.

JT

Last week, stocks continued the decline that began Wednesday of the week before, resulting in a down week for the week just ended. Not every day was a down day, but the down days exceeded the up days. However, the week ended Friday on an up day that exceeded any positive day seen since September 9, so perhaps the month will end on a high note. But considering the state of our politics, I wouldn’t count on it happening.

The following stocks on my lists will be going ex-dividend next week. The firms, ex-dividend dates, and yields, as of Friday’s close, are indicated below:

Main Street Capital (MAIN), 9/28/2020, yield 8.22%. This BDC pays monthly.

Chimera Investment (CIM), 9/28/2020, yield 14.13%.

AGNC Investment (AGNC), 9/29/2020, yield 10.39%. This MREIT pays monthly.

STAG Industrial (STAG), 9/29/2020, yield 4.87%.

Spirit Realty Capital (SRC), 9/29/2020, yield 7.45%.

Algonquin Power & Utilities (AQN), 9/29/2020, yield 4.37%. AQN is a diversified Canadian generation, transmission, and distribution utility company.

Prospect Capital (PSEC), 9/29/2020, yield 14.26%. This BDC pays monthly.

B&G Foods (BGS), 9/29/2020, yield 6.80%.

Annaly Capital Management (NLY), 9/29/2020, yield 13.17%. NLY is a long-time MREIT holding on my high-yield Tier3 list.

MFA Financial (MFA), 9/29/2020, yield 7.66%. MFA is another long-time MREIT on my lists, and was moved to Tier4 (not recommended) after dropping the dividend, which has now been partially restored. MFA remains on Tier4, because of the share price decline, which accounts for the high yield. It doesn’t take a high dividend to get a respectable yield when the stock price drops from the $7-$8 range to the $2 range.

National Health Investors (NHI), 9/29/2020, yield 7.53%.

Nucor (NUE), 9/29/2020, yield 3.56%.This steel company just keeps on paying out a nearly 4% dividend.

Owl Rock Capital (ORCC), 9/29/2020, yield 9.97%. This is a new BDC, which started up in mid-2019.

Goldman Sachs BDC (GSBD), 9/29/2020, yield 11.45%. The Golden Sachs name lends an element of respectability to this BDC, a group which is by definition high-yield and high-risk, and thus not held in high esteem as a group. I suspect GSBD is no worse than most, but perhaps no better, either. Any BDC can disappoint, but are those yields ever-sweet during the good times, and in at least some cases, better than most during the not-so-good times.

Ventas (VTR), 9/30/2020, yield 4.43%. The health-care REITs had been considered the safest REIT group, but the Covid crisis has affected this group disproportionally, with the two bellwether names in the group, VTR, and Welltower (WELL), both reducing dividends and suffering major share price declines, along with other REITs in this category.

Realty Income (O), 9/30/2020, yield 4.78%. O famously pays monthly, identifying itself as the “monthly dividend company”. While the share price has dropped from the pre-Covid highs, O has maintained the dividend, and it does not appear to be at risk, at least not anytime soon. Long-term changes in the commercial real-estate space will likely be putting pressure on O, along with many other REITs, as time moves on.

Two of the fifteen CEFs I track will be going ex-dividend this week, as follows:

AllianceBernstein Global High Income Fund (AWF), 10/1/2020, yield 7.47%. AWF pays monthly.

First Trust Intermediate Duration Preferred & Income Fund (FPF), 10/1/2020, yield 7.51%. FPF also pays monthly.

Only one of my stocks will be reporting earnings next week, Pepsico (PEP), on 10/1/2020. I expect a positive report, based on a fact that I have stated many times, which is that no one has ever lost money betting on Americans continuing to make terrible dietary choices!

Upgrades, downgrades, initiations or resumptions of coverage, and reiterations of ratings, as reported by E*Trade last week on my stocks, were as follows:

Greif (GEF) was upgraded from UnderPerform to Buy at Bank of America.

Southern Company (SO) was upgraded from Equal Weight to OverWeight at Barclays.

Tanger Factory Outlet Centers (SKT) was upgraded from UnderWeight to Sector Weight at KeyBanc. SKT eliminated the dividend and suffered a calamitous stock price collapse during the worst of the Covid storm, and it remains to be seen if any recovery will occur. An upgrade to “Sector Weight” is none too convincing, since the retail REIT sector is only slightly better than movie theater, casino, and hotel REITs, which have been devastated by the pandemic.

United Parcel Service (UPS) was upgraded from Neutral to OutPerform at Credit Suisse.

ONEOK (OKS) was downgraded from Sector OutPerform to Sector Perform at Scotiabank. Since the sector (energy) is performing terribly, this is not encouraging.

Public Service Enterprise Group (PEG) was upgraded from Neutral to Buy at Bank of America.

NextEra Energy (NEE) was initiated at Buy at Seaport Global. This long-term outperforming utility continues to amaze, as the yield drops below 2%, compliments of the ever-climbing stock price.

Greif (GEF) was upgraded from UnderPerform to Market Perform at BMO Capital.

STAG Industrial (STAG) was downgraded from OutPerform to Neutral at Baird.

Horizon Technology Finance (HRZN) was initiated at Neutral at National Securities.

Cisco Systems (CSCO) was resumed at Neutral at UBS.

ExxonMobil (XOM) was upgraded from Sector UnderPerform to Sector Perform at Scotiabank. The management team at XOM is betting on what has always worked in the past, which is finding and bringing to market new sources of fossil fuels. The market does not believe it will work in the new political reality we are into, hence the XOM share price plummet continues.

Freeport-McMoRan (FCX) was upgraded from Equal Weight to OverWeight at Morgan Stanley.  

Occidental Petroleum (OXY) was upgraded from Sector Perform to Sector OutPerform at Scotiabank. The much-maligned management team at OXY, for good reasons, is admittingly doing what they need to do if OXY is ever to recover from this same management team’s catastrophic mistakes of the past couple of years.

Chevron (CVX) was downgraded from Sector OutPerform to Sector Perform at Scotiabank. CVX has managed the energy sector collapse about as well as possible, with the result being CVX hasn’t collapsed as much as some other oil and gas stocks have, hence the rebound, if it ever comes, won’t be as dramatic as some in this sector.

Chevron (CVX) was initiated at Buy at MKM Partners, which may mean that they believe CVX has declined enough that a rebound has plenty of room to run.

General Mills (GIS) was upgraded from Neutral to OutPerform at Credit Suisse. The food stocks, as a group, have definitely outperformed during the pandemic crisis, until just lately, that is.

Plains All-American Pipeline (PAA) was upgraded from UnderWeight to OverWeight at Morgan Stanley. Energy transportation partnerships have been hammered more than any other energy group in the past two years of the “perfect storm” for fossil fuel stocks, and the “second tier” LP’s like PAA have been hammered more than the “first tier” stocks in this group, such as Enterprise Products Partners LP (EPD) and Magellan Midstream Partners LP (MMP). If PAA survives and maintains the reduced dividend, it will be a “bottom-fishing” acquisition that pays off handsomely. But I wouldn’t bet the ranch on this happening, even as I believe there is a chance it will.

Washington Real Estate (WRE) was downgraded from OverWeight to Equal Weight at Capital One.

No doubt the political drama will dominate the news flow over the next few weeks, as the economic news will take a back seat, as far as news-worthy interest. This is logical, because nothing is more important for stocks and investments, as well as everything else, than the outcome of the political struggles to come over the next several weeks.

JT