{"id":25497,"date":"2011-11-22T11:02:26","date_gmt":"2011-11-22T16:02:26","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=25497"},"modified":"2011-11-22T11:02:26","modified_gmt":"2011-11-22T16:02:26","slug":"the-top-performing-income-stocks-many-investors-dont-know-about","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/11\/22\/the-top-performing-income-stocks-many-investors-dont-know-about\/","title":{"rendered":"The Top-Performing Income Stocks Many Investors Don’t Know About"},"content":{"rendered":"

By Nathan Slaughter, globaldividends.com<\/strong><\/span><\/a><\/p>\n

When it comes to income-paying energy stocks, most investors think about oil giants like <\/strong>ExxonMobil or Chevron that pay just 2%-3%.<\/span> But <\/span>why would you buy those low-yielding stocks, when these securities pay up to 13%?<\/span><\/p>\n

A little over a week ago<\/a><\/strong><\/span>, I told you about a striking discovery that caught my team and me a little off guard.<\/span><\/p>\n

Of the 21 best-performing income stocks of the past decade, 12 of them — 57% — come from the energy sector. (You can visit this link<\/a><\/span><\/strong> to see the full list of all 21 stocks.)<\/p>\n

Here’s a sample of the high yields and strong returns we found in the energy sector…<\/p>\n\n\n\n
\n

\"\"<\/strong> <\/strong><\/span>Permian Basin Royalty Trust (NYSE: PBT<\/a>)<\/strong>, a trust that owns royalty interests in oil and gas-producing wells in Texas, has returned 743% since 2001 thanks to its 6.8% yield.<\/strong><\/span><\/p>\n

\"\"<\/strong> <\/strong>North Euro Oil (NYSE: NRT<\/a>)<\/strong>, a trust that owns oil and gas royalty interests in Germany, yields 7.6% and has returned 312% during the past decade.<\/strong><\/span><\/p>\n

\"\"<\/strong> <\/strong>Energy Transfer Partners (NYSE: ETP<\/a>)<\/strong>, a partnership that engages in natural gas transport and storage, has returned 591% and pays more than 8% each year.<\/strong><\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

You can view the rest of the list here<\/a><\/span><\/strong>. If you haven’t heard of these energy companies, you’re not alone. And if you have heard of them, you’re ahead of the curve.<\/span><\/p>\n

The truth is, when you mention income-paying energy stocks, the first thing that comes to most investors’ minds are the oil giants like ExxonMobil (NYSE: XOM<\/a>) or Chevron (NYSE: CVX<\/a>). But Exxon pays just a 2.5% dividend yield. Chevron pays 3.3%.<\/p>\n\n\n\n
\u00a0 <\/ins><\/ins><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

However, the yields you can find in the energy sector can be much more rewarding, if you know where to look.<\/span><\/p>\n

Let me explain…<\/p>\n

Last week<\/a><\/strong><\/span>, I told Dividend Opportunities<\/em> readers about the #1 performing asset class over the past 10 years — it’s up 288%. But MLPs<\/strong>, <\/strong>or master limited partnerships<\/strong>, are some of the easily overlooked links in the energy chain.<\/span><\/p>\n

Many income investors have heard of these partnerships, but I know most haven’t. MLPs run critical “midstream” energy infrastructure — the pipelines, storage tanks, terminals and ships that move energy from producer to user. It’s not a glamorous business. But the fact that most MLPs pay steady yields in the 5%-7% range, and some as high as 13%, sure make them stars for income investors.<\/p>\n

And if you really start digging for income, you can come across even more opportunities that blow away the dividend yields most people associate with energy investments.<\/p>\n

There’s the little-known class of just two dozen companies that T. Boone Pickens pioneered in 1979. They’re called royalty trusts<\/strong>, and they allow anyone to collect royalties from some of the world’s most prolific oil and gas fields. Simply put, royalty trusts allow you to buy a stake in the production of an oil field, just as simply as you would any stock.<\/p>\n

I already mentioned two royalty trusts above, but you almost can’t talk about this asset class without mentioning BP Prudhoe Bay (NYSE: BPT<\/a>)<\/strong>. One of the largest and most well-known trusts, BPT gives you an interest in the legendary Prudhoe Bay oil field in Alaska. Thanks to its 8%-plus yield, BPT has returned 2,440% since 2001. It also distributed payments of almost $10 per share in 2010 and is on track to pay out a similar amount in 2011. That’s nearly $10,000 in income each year for every 1,000 shares you own.<\/p>\n

Then there are the tanker companies<\/strong>. Every day the U.S. imports 12 million barrels of oil, up 50% from a decade ago. Europe imports about the same amount. That’s great news for the tanker business because the majority of the world’s oil is transported by ship — usually across thousands of miles of ocean. When business is good, profit margins are embarrassingly large. An oil tanker that holds 2 million barrels of oil costs about $18,000 per day to run — and can fetch $180,000 per day on the charter market. These stocks can be volatile, but double-digit yields aren’t uncommon.<\/p>\n

And the truth is, these types of securities are just the tip of the iceberg when it comes to energy-focused investments that pay strong dividends. Yet, many investors don’t know they exist… much less that they are offering such appealing dividend opportunities.<\/p>\n

As editor of StreetAuthority’s newest advisory — Energy & Income<\/a><\/strong><\/em><\/span> — I’m focused on the energy sector and its dividends. And In the weeks and months ahead, I’ll be bringing you more about the opportunities for income in the energy sector.<\/p>\n

Stay tuned…<\/p>\n

Good investing!<\/span><\/p>\n

\"\"<\/p>\n

Nathan Slaughter
\nChief Investment Strategist
\nEnergy & Income
\n<\/em> <\/span>
\n<\/em>P.S.<\/strong> — If you’d like to know more about the income opportunities available in the energy sector right now, you can visit this link<\/a><\/strong><\/span> to watch a presentation I recently put together. Included are the names and ticker symbols of every one of the 21 best-performing income stocks<\/strong> that I mentioned earlier. I also go into more detail about the high-yield opportunities like MLPs and royalty trusts that I featured above. Visit this link to watch now<\/a><\/strong><\/span>.<\/span><\/span><\/p>\n\n\n\n
<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Disclosure:<\/strong> <\/span> <\/span> Nathan Slaughter <\/span> does not own shares of the securities mentioned in this article.<\/span><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

When it comes to income-paying energy stocks, most investors think about oil giants like ExxonMobil or Chevron that pay just 2%-3%. But why would you buy those low-yielding stocks, when these securities pay up to 13%?<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-25497","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/25497","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/comments?post=25497"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/25497\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=25497"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=25497"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=25497"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}