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    Top 3 Small-cap Dividend Stocks to Buy Now

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    Editorial Staff
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    A shrewd investor once commented, “Opportunity dances with those already on the dance floor.” In essence, one cannot capitalize on opportunities one is not prepared for, underscoring the significance of understanding current market trends for investors. As we approach 2024, particularly noteworthy trends influencing the stock market landscape are: 

    • Rising inflation, which can disrupt market dynamics and increase pressure on bond yields.
    • An amplified transition towards digital services, propelling the worth of technology sector stocks.
    • Sustainability and green initiatives garner broader acceptance, enhancing the value of eco-friendly and energy-efficient companies.
    • Volatile interest rates make financing unpredictable, thereby inhibiting business expansion.
    • Geopolitical tensions, spurring global uncertainty

    The uniqueness of this financial climate has brought about an increased focus on securing stable, dividend-paying investments. Amid financial turbulence and market volatility, dividend stocks offer the dual advantage of consistent income and potential for capital growth. Furthermore, dividends provide a cushion for investors, dampening the impact of share price swings. While large-caps are traditionally looked at for dividends, small-cap stocks have begun to command attention due to their inherent growth potential and opportunity for a higher yield. 

    Small-cap stocks, typically those with a market cap between $300 million and $2 billion, are often overlooked in favour of their large-cap counterparts. However, these stocks have demonstrated explosive growth potential, frequently outperforming the broader market indexes. This growth potential combined with robust dividend payouts can deliver a powerful punch for the long-term portfolios of investors. 


    Additionally, small-cap dividend stocks are becoming notably significant with the advent of more hawkish monetary policies. As interest rates are projected to rise, businesses with secure cash flows–characteristic of dividend-paying companies–are generally better positioned to navigate through rate hikes. Thus, even in a challenging financial ecosystem, these stocks offer investors benefits they wouldn’t want to miss. 

    “I believe small-cap dividend stocks particularly offer a lucrative investment option. Given their ability to outperform larger indices and the income stability provided through dividends, these stocks should be an integral part of any diverse investment portfolio,” says Francis Jensen, a veteran financial analyst.

     With a dynamic financial landscape as we march into 2024, the benefits of dividend stocks coupled with the explosive potential of small-cap stocks presents a compelling case for them to be part of any diversified portfolio. The three small-cap dividend stocks under $20 are perfect tools to seize this financial opportunity.

    In the next section, we’ll reveal and provide analysis for these three promising stocks.

    Top 3 Small-Cap Dividend Stocks Under $20 to Watch in 2024 

    FAT Brands Inc. (FAT)

    FAT Brands, a global franchising company, has shown tremendous growth in the fast-casual dining space. The company consistently pays dividends, reflecting steady cash flows from robust franchise fee structure and promising expansions. With its stocks priced well under $20, it’s a perfect small-cap dividend investment in this changing market scenario. 

    BGSF, Inc. (BGSF)

    Emerging strong in the workforce solutions segment, BGSF offers comprehensive dividend yields, supported by its robust revenues. As remote work concepts become mainstream, a ripple is created in HR solutions’ demand, positioning BGSF at the peak of this wave. Given its attractive price, BGSF promises remarkable potential for growth within the small-cap dividend space. 

    AmeriServ Financial, Inc. (ASRV)

    ASRV, a multi-billion-dollar banking company, has withstood the challenges of the financial market consistently. It returns a portion of its steady earnings to shareholders through dividends, a testament to its strong financial health. With an affordable stock price under $20 and as a small-cap dividend player, ASRV stands out as an attractive investment for 2024. 

    Final Thoughts

    In the sought-after space of dividend-paying and small-cap investments, the right selection can mean the difference between a mediocre return and a highly lucrative one. I am convinced that FAT Brands Inc., BGSF, Inc., and AmeriServ Financial, Inc. exhibit the attributes of steadfast growth, attractive valuation, and rewarding dividend yields. These companies are positioned well to capitalize on 2024’s anticipated market trends while offering respectable dividend returns for investors. 

    Investment, like knowledge, rewards the diligent and the patient. As a seasoned investor, I have grown to appreciate the charm of dividend stocks and the potential of small-cap scenarios, but the onus of choice always rests solely on the investor. As we stride into 2024, I, like you, will be watching closely as these small-cap dividend stocks shape the market narrative.

    Top 3 REITs for Under $20

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    Editorial Staff
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    As we approach the year 2024, investors are anew adapting their strategies to navigate the ever-evolving landscape of the financial markets. From the oomph of tech companies, a volatile commodities market, to shifting interest rates – capital markets seemingly never sleep. 

    “The current market conditions require meticulous strategy planning. Investors need to be cognizant of the different financial instruments available to them. Diversifying their portfolio in a manner that mitigates risk and maximizes return is paramount today,”

    Catherine Simmons, a seasoned financial analyst.

    In this regard, Real Estate Investment Trusts (REITs) are becoming increasingly significant for market diversification. Here’s why: 

    The Appeal of REITs in Today’s Complex Market 

    The global economic landscape is known for its complexity – a terrain punctuated by consistent ups and downs. With uncertainties abound, the savviest investors continually search for strategic investments that provide diversification, consistent returns, and a lower risk profile. This is where Real Estate Investment Trusts (REITs), particularly those available for under $20, shine brightly in the world of investments. 

    REITs offer several unique benefits that are particularly relevant in the current market scenario. As Rutger van Bostelen, Head of Real Estate at ABN AMRO Private Banking, stated, “REITs’ unique combination of property exposure, liquidity, and steady cash flows make them a compelling option for investors seeking diversification.” This is especially true as we navigate the unpredictability of the markets going into 2024. 

    Primarily, REITs offer a distinct avenue into the real estate market without the associated hassles of property ownership. For those interested in real estate but deterred by the complexities of direct property investment, REITs provide a potent alternative. They offer the liquidity and flexibility of a publicly traded company and allow investors to reap the benefits of real estate appreciation, all without leaving their comfort zones. 

    Moreover, REITs are income-driven investments. They are legally obliged to distribute at least 90% of their taxable income to shareholders annually in the form of dividends. In a volatile market landscape, these regular, substantial payouts offer a semblance of financial stability. In fact, the dividend yields offered by REITs consistently outperform those of other major investing sectors. According to Morningstar, the average dividend yield of US Equity REITs outpaced the S&P 500 averages in the past five years. 

    Such attractive dividend yields along with potential capital appreciation make REITs a strong contender for portfolio diversification. They can provide an effective hedge against inflation, given that real estate often appreciates in value faster than consumer prices. This makes them an appealing choice for investors seeking both income and growth. 

    Lastly, the entry cost for investing in REITs is typically far lower than purchasing properties directly. This is particularly the case for those REITs available for under $20, which we will be exploring further in the following section.

    The Top 3 REITs To Buy For Under $20 

    Investing in REITs does not always necessitate a huge capital outlay. For less than $20, you can partake in the real estate market’s growth. Let’s dive into our top three picks: Ares Commercial Real Estate Corp (ACRE), Brandywine Realty Trust (BDN), and Chicago Atlantic Real Estate Finance Inc. (REFI). 

    Ares Commercial Real Estate Corp (ACRE) 

    Ares Commercial Real Estate Corporation (ACRE) offers an enticing combination of affordable entry and robust returns. Specializing in originated, direct senior real estate loans, ACRE primarily serves middle-market and institutional commercial real estate properties throughout the United States. 

    “ACRE is a model of financial stability and potential growth, a balance many REITs strive to achieve.” – David Roth, Senior Real Estate Analyst

    With a record of consistent dividends and a promising FFO (Funds From Operations) per share growth rate, ACRE remains a potentially profitable investment for under $20. 

    Brandywine Realty Trust (BDN) 

    Brandywine Realty Trust (BDN), a self-administered, self-managed and fully integrated Real Estate Investment Trust, focuses primarily on ownership, management, leasing, acquisition, and development of urban, town center and transit-oriented office properties in the United States. 

    Despite the global pandemic, BDN has demonstrated resilience with strong leasing activity and increased rent prices. With it’s shares trading under $20, BDN provides an affordable opportunity to partake in the recovery and growth of office real estate. 

    Chicago Atlantic Real Estate Finance Inc. (REFI) 

    Last but not least, Chicago Atlantic Real Estate Finance Inc. (REFI) offers an entry point into the thriving industrial, logistic, and warehouse property sector. As of Q4 2023, REFI has boasted a significant gain in its portfolio value, mainly because of the e-commerce boom that has increased the demand for industrial real estate. 

    REFI’s performance indicators, including its exceptional Dividend Yield and Property Income, are impressive for a REIT that is available for under $20. The firm’s commitment to maintaining a strong balance sheet and delivering reliable, long-term value to stockholders make it a worthy candidate for your investment portfolio.

    REFI has made a name for itself through its deft maneuvering in the commercial mortgage space, consistently delivering generous income to shareholders through commercial real estate investments. 

    One of the standout features of REFI is its dividend yield. At around 7%, according to Reuters, it outperforms many other REITs in terms of percentage yield. This means it delivers more return per dollar invested than many of its peers. Furthermore, its dividend has been consistent, providing predictable income to investors, a feature cherished by income-focused investors. 

    In 2023 alone, according to Statista, REFI’s property income increased substantially, testifying to its efficacy in managing real estate assets and generating revenue. Its consistent asset growth and ROI (Return on Investment) have contributed to its stability even in volatile market conditions. With most REITs grappling with the effects of changing economic dynamics, REFI has not only survived but thrived. 

    Conclusion & Personal Investment Thesis

    In conclusion, we find ourselves in an investment landscape that continuously presents opportunities if you know where to look. Real Estate Investment Trusts, particularly affordable ones like Ares Commercial Real Estate Corp (ACRE), Brandywine Realty Trust (BDN), and Chicago Atlantic Real Estate Finance Inc. (REFI), provide investors with a serious and viable avenue to diversify their portfolios and seek returns above market averages. 

    It’s worth noting the appeal of these trusts. Amid the current market scenario, where interest rates are low and growth stocks often valued high, the fixed income and relative stability offered by quality REITs are compelling arguments for their inclusion in any portfolio. 

    Believe me when I say, not only do these REITs provide a chance for remarkable income generation thanks to their high dividend yields, but they can also serve as a bulwark against market volatility, often maintaining their value even when other sectors falter. Essentially, REITs are akin to ‘safe-haven’ assets that can mitigate risk during tumultuous market conditions. 

    As Benjamin Graham, the father of value investing, once said, “The essence of investment management is the management of risks, not the management of returns.”

    Every investor’s primary objective should be to protect their capital, and these REITs genuinely offer that shield. I firmly believe that it’s high time investors reassessed their portfolios and considered the added benefits of including affordable REITs in their strategy. If we review the past year’s performance, these REITs have consistently outperformed broader market indices. This is indicative of an underlying strength that potential investors shouldn’t overlook. 

    Ultimately, making investment decisions is a deeply personal process, one that needs to take into account individual risk tolerance, financial goals, and investment time horizons. Yet, I firmly believe that these top three REITs under $20 offer an attainable entry point into the real estate sector, and promise an attractive blend of stability, income, and potential growth. 

    Remember that investing isn’t solely about growing wealth quickly; it’s equally about ensuring financial security and preparing for the future. As an investor, my belief is clear – investing in the selected REITs provides an opportunity to achieve both of these objectives.

    Three Dividend-Paying Gold Stocks to Hedge Your Portfolio Against Growing Risks

    By
    Editorial Staff
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    These gold stocks are poised to produce passive income and profits in the face of a weakening economy.

    Gold has been making headlines lately, with the spot price reaching a 52-week high of $2021.82 per ounce on April 4th. However, the price has since fallen and is hovering around the $2000 mark as investors await the release of crucial economic data and the latest Federal Reserve meeting minutes.

    Despite the short-term volatility, experts remain optimistic about gold’s long-term prospects. In fact, many believe that gold will continue to push higher in 2023. According to Bob Carlson, a pension fund chairman and leader of the Retirement Watch investment newsletter, gold is a “crisis hedge” that can protect investors against financial crises and political conflicts.

    As borrowing costs increase due to the Fed’s tight monetary policy, many investors are turning to gold as a safe haven asset. And with global political conflicts on the rise, there’s no doubt that gold will continue to be an attractive option for risk-averse investors.

    In this watchlist, we’ll highlight the top dividend-paying gold stocks that can provide investors with both capital appreciation and steady income. So, whether you’re a seasoned investor or just getting started, keep an eye on these top dividend-paying gold stocks as you navigate the gold market in the coming months.

    Franco-Nevada Corp (FNV)

    The precious-metals-focused Franco-Nevada owns a diversified portfolio of gold, silver, and platinum, along with their related royalty streams. The company does not operate mines, develop projects or conduct exploration. Instead, Franco-Nevada’s short-term financial performance is linked to the price of commodities and the production of its portfolio of assets. Mining royalty companies have large portfolios of mining companies as clients and therefore are typically less risky than owning one or two individual mining companies.

    Franco-Nevada is a strong contender in the mining financing business. The company offers a unique way to gain exposure to precious metals and has a diversified portfolio of assets without the risks associated with owning individual mining companies. With an annual cash flow of over $500 million and a 1% dividend yield, Franco-Nevada is fundamentally strong and, according to the experts, has the potential for a 20% upside in the next 12 months.

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    Newmont Mining (NEM) 

    Newmont Mining is the world’s largest gold mining operation, with mining sites in various countries, including the United States, Australia, and Canada. The company’s acquisition of Goldcorp in 2019 has added to its portfolio of mines and assets, with over 100 million ounces of proven and probable gold reserves, in addition to producing silver, copper, and zinc, as well as running a merchant banking operation. The stock is trading at a reasonable 15 times forward earnings.

    Hinging on no uptick in the price of gold, BofA forecasts Newmont’s earnings per share will rise from $2.85 in 2022 to more than $5 in 2023. With all-in costs of $1,150 per ounce, profits will grow dramatically if gold prices move higher. Investors also can be paid for their patience in holding the stock with a 3.3% dividend yield.

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    Triple Flag Precious Metals Corp. (TFPM) 

    Like Franco-Nevada, Toronto-based Triple Flag serves as a finance partner to facilitate the development and expansion of mining projects. With a focus on cash-generating mines and fully permitted projects that can produce cash flow within two years, the company seeks prudent investments in earlier stages of the mine life cycle to maintain exposure to development-stage assets and grow free cash flow per share over the long term. 

    While risks include precious metal price volatility, competition from the royalty and streaming sector, and ramp-up issues at its mines, catalysts could include higher-than-expected gold and silver prices, future exploration discoveries, and unexpected mine expansions and acquisitions. TFPM investors enjoy a 1.3% dividend yield.  

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    Three Dividend Stocks to Steer Clear Of

    By
    Editorial Staff
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    Don’t be fooled by these dividend traps.

    Investing in dividend-paying stocks can be a great way to generate predictable returns during times of uncertainty. But just like with any category of stocks, there are some dividend stocks to steer clear of. Some dividend stocks are at high risk of reducing/ suspending their payouts, while others have downside risks that outweigh their respective payouts.  

    Simply put, there are many dividend plays that are potential portfolio poison. In this list, we’ll cover three such toxic dividend stocks.  

    Intel Corporation (INTC)

    Chipmaker, Intel announced Wednesday that it would cut its quarterly dividend by more than 65%, from 36.5 cents to 12.5 cents. The company also reaffirmed its recently issued outlook for the first quarter of 2023. Intel guided to a 15-cent non-GAAP loss per share but didn’t provide full-year guidance, citing economic uncertainty. Analysts expected free cash flow to run negative for 2023 and 2024, with Intel paying out about $6 billion yearly for common-stock dividends.

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    Abrdn Income Credit Strategies Fund (ACP)

    A closed-end fund, Abrdn Income Credit Strategies Fund, offers a high forward dividend yield of 14.35%. However, Over the past year, ACP shares have fallen by more than 20%. Further declines may be ahead for two reasons.

    First, the Fed plans to raise interest rates as it attempts to tamp down high inflation. Higher rates have an inverse effect on the value of ACP’s portfolio of low-rated debt securities. Second, the current economic downturn could increase the default risk of ACP’s holdings. This may also result in another dividend cut, like the 16.7% cut implemented in 2020. 

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    Adeia (ADEA)

    Adeia is an intellectual property licensing firm with a relatively low forward dividend yield of 1.89%. Taking into account downside risk,  questionable whether the company can maintain its current rate of payout. Sell-side analysts anticipate ADEA’s earnings will fall by nearly 30% this year. If management’s plan to maximize its portfolio fails, its payout could be cut to ribbons. This may result in a steady decline for ADEA stock as well.

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    Three High-Yield Dividend Stocks for the New Year

    By
    Editorial Staff
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    Amid unrelenting inflation and a strong potential for a recession, volatility is widely expected to continue as we head into the new year, making the job of selecting stocks difficult. A logical move in times like these is dividend stocks, which pay you to hold them. Dividend-paying companies regularly reward investors directly with a portion of the cash flow. The most desirable dividend stocks have a history of raising payouts over time as the company’s profits grow.  

    In this list, we’ll look at three yield-paying stocks that seem ripe for the picking as we head into the new year.  

    Pioneer Natural Resources Company (PXD) has long viewed sustainability as a balance of economic growth, environmental stewardship, and social responsibility. Its emphasis is on developing natural resources that protect surrounding communities and preserve the environment.

    In the wake of the pandemic, when energy prices were, cheap PXD struck an almost perfectly timed agreement to buy fellow Permian Basin producer Parsley Energy for $4.5 billion. If you’re wondering how PXD managed to finance that transaction, the answer lies in the fact that it was an all-stock deal that ensured Pioneer didn’t have a new giant debt load hanging over its head. The fact that Parsley operated primarily in the same region of West Texas, where Pioneer had both expertise and existing staff, has paid off over time.   

    That deal was a coup for Pioneer shareholders, built on the fact it was large and well-capitalized at a time when stressed and debt-reliant shale plays were looking for a white knight. On top of that acquisition, PXD also boosted its dividend by 25% at the start of the year as further evidence of its strong balance sheet.

    Investors can look forward to upcoming tailwinds, including Pioneer’s recently announced partnership with the world’s largest renewable energy producer, NextEraEnergy (NEE), to develop a 140-megawatt wind generation facility on Pioneer-owned land. The project will supply the company’s Permian Basin operations with low-cost, renewable power and is expected to be operational next year.  

    In the third quarter, revenue was up 22% YOY to $6.09 billion, smashing the consensus estimate of 4.57 billion. The company reported earnings of $7.48 per share, beating consensus expectations of $7.27 per share. So far, in 2022, the company has rewarded its investors handsomely with $20.73 per share through its generous 10.78% cash dividend. Chief Executive Officer Scott D. Sheffield stated, “Pioneer continues to execute on our investment framework that provides best-in-class capital returns to shareholders. This framework is expected to result in $7.5 billion of cash flow being returned to shareholders during 2022, including $26 per share in dividends and continued opportunistic share repurchases.”

    Even after gaining 33% over the past year, Pioneer shares likely still have valuation upside in addition to their tremendous dividend income potential.   

    Anyone who has kept tabs on the global supply chain and shipping saga that’s been unfolding since the outbreak of covid is probably familiar with Genco Shipping (GNK). The company owns a fleet of 44 ships it leases for dry bulk transportation of goods like grain, coal, and iron ore. The going rate to rent one of Genco’s ships is no less than $27,000 per day, which provides some solid cash flow that the company uses to reward its shareholders.  

    Dry bulk shipping rates, along with GNK’s share price, have fallen in recent months. Still, as China recovers from recent lockdowns and seasonal demand is expected to be strong, it’s hard to see the pullback in share price as anything less than an opportunistic bargain. This is a very volatile sector, but it’s essential to the world’s supply chain. 

    Although the company missed consensus EPS and revenue estimates in the third quarter, it remained consistent with its previously outlined value strategy. The company’s prudent cargo coverage in Q2 resulted in significant benchmark freight outperformance in Q3, allowing Genco to pass the savings onto its investors via a 56% quarterly dividend increase on a sequential basis. Over the last four quarters, the company has declared dividends of $2.74 per share, delivering on its commitment to return substantial capital to shareholders. GNK currently pays a 20% dividend yield.  

    It should be no surprise that the defense giant Lockheed Martin (LMT) has outperformed the market this year. There are apparent geopolitical implications with the war in Ukraine. When Russia decided to invade its neighbor, both U.S. and European forces rushed in to help Ukraine. It may be some time before LMT stock pops again, as it did at the onset of Russia’s invasion of Ukraine. However, its order books are likely to improve due to rising defense budgets in the U.S. and abroad. Along with Lockheed providing support to Ukrainian resistance fighters, the looming uncertainties in Russia could lead to massive economic problems and gaps in power in former Soviet Union-controlled areas.

    Given the recession-proof nature of defense contracting, Lockheed Martin should continue reporting positive results and rewarding shareholders through its quarterly 2.7% forward yield. In other words, even if the market dives again, LMT will likely stand firm. The company runs a P/E ratio of 24 times, below the sector median of 28.3 times. As well, LMT features excellent longer-term growth and profitability metrics.

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