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Five Struggling Dividend Stocks I'm Still Bullish On

by: Dividends4Life August 21, 2008 | about stocks: ACAS / FR / GE / SFI / STI    

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Earlier this week we looked at my top 5 high fliers for 2008. Unfortunately, for every up, there is a down and that is certainly true for my portfolio. As before, we will look at results through July 31, 2008. Here they are my cellar dwellers with comments:

#5 - General Electric (GE) -19.3% Total 2008 Return
Of my cellar dwellers, GE is the one I am most bullish on. I liked it at $38 when I bought my first tranche in July/2007, and liked it even more at $29 when I bought my last tranche this month.

#4 - First Industrial Realty, Inc. (FR) -22.3% Total 2008 Return
This was my first ever dividend investment. It was purchased in December/2003. FR has consistently raised it's dividend since then; and unfortunately, its share price has consistently fell since then. FR has more lives than a cat - each time I give it up for dead, FR raises its dividend.

#3 - SunTrust Banks, Inc. (STI) -31.8% Total 2008 Return
Until recently, STI wore the cellar dweller crown. It very well could be the next bank divested, if it cuts its dividend.

#2 - American Capital Strategies, Ltd. (ACAS) -31.9% Total 2008 Return
ACAS has long been one of my favorite stocks. I have been in and out of it since February/2004 and still have a positive 2.2% life-to-date annualized return. ACAS continues to raise its dividend, but at some point it operating results will have to turn around.

#1 - iStar Financial Inc. (SFI) -63.8% Total 2008 Return
SFI is on a breathing machine and short of an immaculate recovery it likely will not make it to the end of the year. It's 14.6% yield on cost will be missed, while its double-digit share price collapse will not.

I take solace that even with these poor performers, I am still ahead of the S&P 500 for the year. In dividend investing, you can't focus too much on the good or bad. You learn from each and keep your eye on the long-term.

Disclosure: Long in GE, FR, STI, ACAS and SFI.

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This article has 16 comments:

  •  
    Aug 21 08:51 AM
    Interesting. Dividend investing is as tricky as value or else. I am long DSX and waiting, waiting and rode WM from 16 in 1998 to ... 16 in 2008!
    Reply
  •  
    Aug 21 10:11 AM
    boy am i happy with fro. nobody has figured out a way to pave over the ocean. they have been paying great dividends & @ 15% max tax this is really good.current yield app.18%. mine over 30% since i bought real low many months ago.lol@ analysts.
    Reply
  •  
    Aug 21 12:21 PM
    I'm with notsosmart, FRO is a winner. Even if the supply of oil/nat gas is decreasing, it isn't going to deplete itself overnight and we still don't have a better way to get it here. As long as Nancy Pelosi plays her games, I will stick with FRO. After all, if oil and the transportation of it from "there to here" is her game plan, I might as well make money off it. Go, Nancy.
    Reply
  •  
    Aug 21 02:34 PM
    FRO and the other JF companies......you don't really need much else. They are all sure bets if you are interested in dividends and future growth. The realities of the energy dilemma will be with us for awhile....at least until the alternative energy vehicles are availalbe at a reasonable price in every showroom.
    Reply
  •  
    Aug 21 05:00 PM
    With OECD numbers showing developed country GDP growth at only 0.2% QoQ, I would be worried about an internationally diversified and government spending-dependent company like GE
    Reply
  •  
    Aug 21 06:13 PM
    re .. FR ...has consistently fell????? Try...has consistently FALLEN.

    ...has consistely raised it's dividend????? At this point in time, you need to learn that it with an apostrophe means IT IS. So, did you mean to write, "has consistenly raised it is dividend"? Hopefully, you didn't. But the thought is scarry. If you want to make what you say credible, watch your grammar and punctuation. Both label you, for better or for worse.
    Reply
  •  
    Aug 21 06:17 PM
    Re ACAS... it operating results have to turn around????? Try ITS (NO APOSTROPHE) operating results have to turn around. Buy yourself a book on grammar/punctuation. Then put your thoughts on paper.
    Reply
  •  
    Aug 21 06:32 PM
    Damn,nyka,take a pill...this is the interweb...not Mr.Tightass's homeroom!! I'm looking for content,not grammar...
    Reply
  •  
    Aug 21 09:09 PM
    hey nyka, you are scary! LMAO. Guy gives a lecture and then botches the english language in the next sentence.

    As for the analysis on SFI...very weak
    Reply
  •  
    Aug 22 12:16 AM
    Re: ACAS. I think the game has changed for the BDCs for the next few years because the tight credit markets have put paid to traditional exit strategies for portfolio holdings. They'll have to focus on instituting genuine operating improvements in their companies, and concentrate on cash flow/profits.

    just sayin'
    Reply
  •  
    Aug 22 02:19 AM
    Here's some nice yielders to look at -

    Some that I own and trade : DSX, PWE, PGH, PCU
    Several that I am watching: FTR, NRO, PVX, DGT, DVY, BPT
    Likely REIT survivors: NRF, RAS, GKK, CRZ, CMO, NLY, CSE, AHR
    Others to watch: ARCC, AYR, PGF, LYG, CODI, PKG, CTB, GNW
    And, for the brave among you, GM Debt: XGM, GMS, GMW, HGM, RGM
    Reply
  •  
    Aug 23 11:33 AM
    Out of that list there is one that looks attractive. It may go to zero but could be an easy triple so the r/r is well worth it.

    Advice to nyka: lite'n up, u'll live longa.
    Reply
  •  
    Aug 23 01:03 PM
    Too much emphasis on financials and real estate.
    Reply
  •  
    Aug 23 01:58 PM
    Good luck on your picks...you'll definitely need it.
    Reply
  •  
    Aug 23 10:54 PM
    Ge does business with Iran and is partial in the election so I cant invest in them.You want 5 great dividends stocks that combine sfety and growth and income. KFT MO PM UST RAI
    Reply
  •  
    Aug 24 02:07 PM
    nyka is the wrong chat room. APL, EEP,ETP,EPD,MMP,NS,PAA...
    TCLP,TPP,FGP,NRGY,KSP,... are
    all great income stocks. Been investing for 52 years, retired at 44.
    Reply
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