High-yield dividend stocks are advantageous in today's economy as they provide dependable income and stability, particularly during economic downturns. Amid economic instability, high-dividend-yield stocks can manage economic volatility effectively, and they usually have robust financials, making them a strong option for consistent returns and long-term growth.
Therefore, high-yield dividend stocks, One Liberty Properties, Inc. (OLP), NewLake Capital Partners, Inc. (NLCP), and Euroseas Ltd. (ESEA) might be worthy watchlist additions.
Prices in the United States increased moderately in June as the declining cost of goods tempered a rise in the cost of services, underscoring an improving inflation environment that could position the Federal Reserve to begin cutting interest rates in September.
The Commerce Department report on Friday also showed that consumer spending slowed a bit last month. Job growth in the country slowed in June from the previous month, while the unemployment rate ticked up to 4.1%. This could signal a weakening economy and induce a rate cut soon.
As the backdrop remains volatile, and considering these macroeconomic factors, we believe that high-yield dividend-paying stocks could provide stability to investors' portfolios. With this in mind, let's explore the fundamentals of three over 5% dividend-yield stocks.
One Liberty Properties, Inc. (OLP)
OLP is a self-administered and self-managed real estate investment trust incorporated in Maryland in 1982. The Company acquires, owns, and manages a geographically diversified portfolio consisting primarily of industrial and retail properties.
OLP pays a $1.80 per share dividend annually, translating to a 6.84% yield on the current share price. Its four-year dividend yield is 7.76%.
In terms of the trailing-12-month gross profit margin, OLP’s 80.87% is 22.4% higher than the 66.05% industry average. Its 61.03% trailing-12-month levered FCF is 83.3% higher than the 33.30% industry average. Likewise, the stock’s 35.89% trailing-12-month EBIT margin is 66.4% higher than the 21.57% industry average.
OLP’s total revenues for the fiscal first quarter that ended March 31, 2024, were reported at $22.70 million. Net income attributable to OLP and net income per share attributable to common stockholders stood at $5.16 million and $0.23, respectively. In addition, its total assets, as of March 31, 2024, stood at $755.67 million, compared to $761.61 million as of December 31, 2023.
For the quarter ended June 30, 2024, OLP’s revenue is expected to increase marginally year-over-year to $22.48 million. Its EPS for the same quarter is expected to be $1.43. OLP surpassed the consensus revenue and EPS estimates in three of the trailing four quarters.
OLP gained 45.1% over the past nine months to close its last trading session at $26.51.
OLP’s POWR Ratings reflect its robust outlook. The stock has an overall rating of B, which translates to Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
OLP has an A grade for Sentiment and a B for Momentum, Quality, and Stability. It is ranked #4 out of 45 stocks in the REITs - Diversified industry.
For additional OLP’s Growth and Value ratings, click here.
NewLake Capital Partners, Inc. (NLCP)
NLCP is an internally managed real estate investment trust that provides real estate capital to state-licensed cannabis operators through sale-leaseback transactions, third-party purchases, and funding for build-to-suit projects.
NLCP pays a $1.72 per share dividend annually, translating to an 8.84% yield on the current share price. Its four-year dividend yield is 7.30%.
In terms of the trailing-12-month gross profit margin, NLCP’s 98.79% is 50.1% higher than the 65.84% industry average. Likewise, its 5.91% trailing-12-month Return on Total Assets is 305.1% higher than the industry average of 1.46%. Furthermore, the stock’s 69.02% trailing-12-month levered FCF margin is 110.5% higher than the industry average of 32.79%.
NLCP’s total revenues for the first quarter ended March 31, 2024, increased 10.4% year-over-year to $12.61 million. The company’s net income grew 17.1% year-over-year to $6.99 million, while its net income attributable to common stockholders per share increased 22.2% year-over-year to $0.33.
Street expects NLCP’s FFO for the quarter ended June 2024 to increase 13.6% year-over-year to $0.50 and revenue for the same quarter to expand 10.8% year-over-year to $12.60 million. OLP surpassed the consensus revenue and EPS estimates in three of the trailing four quarters.
NLCP gained 52% over the past month to close its last trading session at $19.46.
NLCP has an overall A rating, equating to a Strong Buy in our proprietary rating system. NLCP also has an A grade for Sentiment and a B for Momentum, Quality, and Quality. It is ranked first out of 44 stocks in the Real Estate Services industry.
To see additional POWR Ratings for Value and Growth, click here.
Euroseas Ltd. (ESEA)
Based in Marousi, Greece, ESEA provides ocean-going transportation services worldwide. The company owns and operates containerships that transport dry and refrigerated containerized cargo, including manufactured products and perishables.
On July 23, 2024, ESEA announced today a new time charter contract for its 1,740 feeder containership, EM Spetses, for a minimum period of 18 to a maximum period of 20 months at the option of the charterer, at a gross daily rate of $18,100. The charter for EM Spetses will commence in early August 2024 upon the completion of its current charter.
ESEA pays a $2.40 per share dividend annually, translating to a 6.56% yield on the current share price. Its four-year dividend yield is 3.54%.
ESEA’s 22.71% trailing-12-month Return on Total Assets is 364.8% higher than the industry average of 4.88%. Furthermore, the stock’s 72.25% trailing-12-month gross profit margin is 131.1% higher than the industry average of 31.27%.
ESEA’s net revenues for the first quarter ended March 31, 2024, were reported at $41.94 million. The company’s operating income grew 45.6% year-over-year to $29.69 million. Net income and earnings per share increased 43.8% and 42.9% year-over-year to $28.75 million and $0.76, respectively.
Street expects ESEA’s revenue for the fourth quarter ending December 2024 to increase 3.6% year-over-year to $50.83 million. Its EPS is expected to be $2.36 for the same quarter. It surpassed the EPS estimates in each of the trailing four quarters.
The stock has gained 13.1% over the past year to close the last trading session at $36.61.
ARCC also has a B grade for Momentum. It is ranked #12 in the Private Equity industry. Beyond what is stated above, we’ve also rated ARCC for Growth, Value, Stability, Sentiment, and Quality. Get all ARCC ratings here.
What To Do Next?
43 year investment veteran, Steve Reitmeister, has just released his 2024 market outlook along with trading plan and top 11 picks for the year ahead.
OLP shares were trading at $26.55 per share on Wednesday afternoon, up $0.04 (+0.15%). Year-to-date, OLP has gained 25.97%, versus a 16.65% rise in the benchmark S&P 500 index during the same period.
About the Author: Nidhi Agarwal
Nidhi is passionate about the capital market and wealth management, which led her to pursue a career as an investment analyst. She holds a bachelor's degree in finance and marketing and is pursuing the CFA program. Her fundamental approach to analyzing stocks helps investors identify the best investment opportunities.
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