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Whether The The Great Reach For Yield Experiment Has Failed

Published Mon, 18 May 2020 07:30:35 -0400 on Seeking Alpha

The lowest yields in history have caused many conservative investors and savers to reach for yield as they risk out living their principal.
Wall Street ingeniously came up with products that had juicy dividends on the front end, in the form of fat and shiny dividends, but these have mostly been bad bets.
I would caution readers to be careful before thinking this is an amazing and 'generational' buying opportunity.
One of Seeking Alpha's best features is the fact that it is an open source platform. SA editors do a great job of enforcing the editorial rules and frameworks. SA editors take an approach of a referee that 'let's them play' instead of calling ticky-tacky penalties (think some badly officiated NFL or NCAA Football games). I'm paraphrasing here, but Seeking Alpha CEO, Eli Hoffman, has often said the goal of Seeking Alpha is to have one (or more) well informed bulls and one (or more) well informed bears write on a particular stock. This way, the bull and bear case can be made, the commentary section threads will be robust, and the readers can make the best and most informed decisions.
Given that encouragement for a different point of view, I write to express a food for thought piece. This is similar, in that its contrarian nature, to my recent piece on tanker: Play Devil's Advocate To The Bullish Tanker Thesis (published before the bell on May 5th).
As someone who has spent countless hours writing on SA, and countless articles reading articles on the site, I can safely say there is a lot of latitude to form an argument and express a view. However, I have noticed that there are strong pockets of popularity for what I would call 'reaching for yield', or perhaps some might even say 'chasing yield'. At least anecdotally, articles written about stocks with high yielding dividends seems to constantly trend on SA's front page. Moreover, writing about high yielding dividend stocks has almost become a cottage industry on SA.
As an outside observer,... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
WP GLIMCHER 4.18   24.6 0.17 1.00 24.10
PENNSYLVANIA REAL ESTATE INVESTMENT TRUST 5.68   0.0 -1.81 0.84 14.58
ANNALY CAPITAL MANAGEMENT 8.60   0.0 -3.32 1.20 14.00
AMERICAN CAPITAL AGENCY 15.64   0.0 -1.54 1.92 12.21
MACERICH 33.33   43.9 0.76 3.00 8.91
TANGER FACTORY OUTLET CENTERS 16.50   21.4 0.77 1.42 8.35
STARWOOD PROPERTY TRUST 24.39   18.5 1.32 1.92 7.95
PLAINS ALL AM. PIPELINE 21.20   5.3 3.99 1.44 6.75
MAGELLAN MIDSTREAM PARTNERS 65.61   11.0 5.99 4.05 6.20
TAUBMAN CENTERS 43.64   59.0 0.74 2.70 6.16
ENTERPRISE PRODUCTS 28.68   12.4 2.31 1.76 6.13
WILLIAMS 24.29   303.6 0.08 1.52 6.12
SIMON PROPERTY GROUP 155.27   20.8 7.48 8.40 5.21
KINDER MORGAN 20.42   20.6 0.99 1.00 4.94
AMERICAN TOWER 218.85   66.3 3.30 3.68 1.70
ISHARES FTSE NAREIT MORTG PLUS CAPPED INDEX FUND 41.97   0.0 0.00 0.00 0.00

WP GLIMCHER - WPG
WP GLIMCHER - WPG  


Older articles featuring Wp Glimcher (WPG):
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We Need To Talk About Dividend Cuts - They Are A Necessary Evil
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Our High Yield REIT Portfolio - Optimizing Rebound Potential
Now Is Not The Time To Be A High-Yield REIT Investor
Our Top REIT Preferred: +9% Yield From PREIT
Washington Prime Group Inc: Can You Trust This 27% Dividend?
Our 2020 High Yield REIT Portfolio
50 Dividend Dogs With 10%-Plus Yield At $1-$10 Prices For December
The Mystery Of REIT Dividend Cuts In The Great Recession

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