Published Sun, 04 Oct 2020 08:00:00 -0400 on Seeking Alpha
Seeking AlphaDividend IdeasI Bought Fidus Investment: 12% Yield And 35% Below BookOct. 4, 2020 8:00 AM ET|| About: Fidus Investment (FDUS), FDUSG, FDUSL, FDUSZ, Includes: AINV, ARCC, CGBD, CSWC, CSWCL, FSK, GAIN, GBDC, GLAD, GSBD, HCXY, HCXZ, HTGC, MAIN, NMFC, OCSL, PNNT, PNNTG, PSEC, TCPC, TPVG, TSLXby: BDC BuzzBDC Buzz Sustainable DividendsBuild a portfolio with sustainable dividend yields ranging from 8% to 12%SummaryI recently started a position in FDUS as I believe that there's a good chance for a total return potential of 30% or higher over the next 12 months.
FDUS is currently trading at a 35% discount to book value, driving a current annual dividend yield of 12%.
There's also the possibility for additional special dividends.
This is part of a series of articles discussing retirement portfolios using BDCs currently yielding around 12% and their safer notes - baby bonds/preferred shares with yield-to-maturities ranging from 6% to 10%.
This article is part of a series discussing how to build a retirement portfolio using business development companies ("BDCs") currently yielding over 12% and their safer notes - baby bonds/preferred shares with yield-to-maturities ranging from 6.5% to 10.0%. The previous article discussed Golub Capital (GBDC) which is a lower yielding BDC that typically implies a "safer" portfolio and/or sustainable dividend coverage.
Active Insider Buying At Golub Capital Yielding 8.8%
BDC Buzz Starts a Position in FDUS
I recently started a position in Fidus Investment (FDUS) because I believe that there's a good chance for a total return potential of 30% or higher over the next 12 months as discussed at the end of the article. My subscribers are well aware that I often wait for stocks to have a relative strength index of ("RSI") of close to 30 before buying. This is the definition from Investopedia:
The relative strength index (RSI) is a momentum indicator developed by noted technical analyst... Read more
|Stock name||Last trade||P/E||Earnings/Share||Dividend/Share||Dividend yield|
|OAKTREE SPECIALTY LENDING||4.90||0.0||-1.39||0.50||10.02|
|HERCULES TECH GROWTH CAP||13.26||10.0||1.32||1.28||9.55|
|GOLDMAN SACHS BDC||20.29||22.5||0.90||1.80||8.88|
|GOLUB CAPITAL BDC||18.55||15.7||1.18||1.28||6.89|
|MAIN STREET CAPITAL||43.18||16.8||2.57||2.46||5.69|
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