After nearly a decade of historically low interest rates, many yield-starved income investors have flocked to high dividend stocks. But there are many different classes of high-yield stocks, some much safer and more appropriate for conservative investors than others. Let's take a look at one popular high-yield investment class, royalty trusts, to see what investors need to know before investing in them. Most importantly, learn why their business models and limitations likely make them inappropriate for meeting your income needs, especially in retirement. What are Royalty Trusts?  The first royalty trust was incorporated in 1956, although the popularity of royalty trusts did not really take off until the 1980s. Around two dozen royalty trusts are listed on U.S. exchanges today, [...]

EQT Midstream Partners, LP (EQM) is a master limited partnership formed by EQT Corp (EQT) to own, operate, and expand its gas gathering, storage, processing, and transportation assets in the Marcellus and Utica shale regions of Pennsylvania, West Virginia, and Ohio. The firm's assets provide midstream services to EQT, other energy producers, and utilities to support energy development and production. The combined Marcellus and Utica region is the largest and lowest cost gas formation in the U.S. and is expected to see very strong production growth over the coming decades. Today EQT Midstream is the third largest transporter of natural gas in America and owns:

Whenever a dividend stock's price plunges to multi-year lows, investors naturally want to know if the market is signaling that something is deeply wrong, such as if the business model has weakened enough to potentially put the dividend at risk. That's been the case with food giant Kraft Heinz (KHC), which has fallen over 40% from its early 2017 peak while the S&P 500 has climbed more than 15% during that time. Let's take a closer look at Kraft Heinz's struggles to evaluate the safety of its dividend and whether it is appealung as a long-term investment. Why Kraft Heinz is Struggling The key reason why the market dislikes Kraft Heinz right now is that, like many food companies, the [...]

Founded in 1894 in Hershey, Pennsylvania, Hershey (HSY) manufactures and sells chocolate and non-chocolate confectionery products including: gum and mints; baking ingredients such as toppings, beverages, and syrups; and snack items, including spreads, meat snacks, bars, mixes, popcorn, protein bars, and cookies. These products are marketed under over 80 leading brands including: Hershey’s, Reese’s, Kisses, Jolly Rancher, Almond Joy, Brookside, barkTHINS, Cadbury, Good & Plenty, Heath, Kit Kat, Payday, Rolo, Twizzlers, Whoppers, York, Scharffen Berger, Dagoba, Ice Breakers, Breathsavers, SkinnyPop, Krave, and Bubble Yum.

Meredith (MDP) is one of the nation's oldest media and publishing companies, having been founded in 1902 as an agricultural publisher. More impressively, the firm has paid uninterrupted dividends for 71 consecutive years and has increased its dividend in each of the last 25 years. At its core, Meredith provides consumers with the content they want by leveraging print, digital, mobile, video, and broadcast TV media platforms. Advertising is the company's largest source of revenue. Meredith organizes its various media businesses into two segments: Local Media (31% of sales, 66% of operating profits): owns 17 local TV stations including: seven CBS affiliates, five FOX affiliates, two MyNetworkTV affiliates, one NBC affiliate, one ABC affiliate, and two independent stations. This segment also [...]

Founded in 1920, Occidental Petroleum (OXY) is an international exploration and development (E&D) company with operations in North America, Latin America, and the Middle East. The firm's production is somewhat balanced across oil (64% of total production), gas (21%), and natural gas liquids (15%). Occidental is also geographically diverse with about half of its energy production taking place in international markets. The company has three business segments: Oil and Gas (21% of 2018 cash flow): explores for, develops, and produces oil and condensate, natural gas liquids (NGLs), and natural gas. Occidental's upstream operations are located across New Mexico, Texas, Colombia, Oman, Qatar, and the United Arab Emirates. Chemical (34% of 2018 cash flow): manufactures basic chemicals and vinyls, including chlorine, caustic soda, [...]

It's been a brutal year for dividend aristocrat AbbVie (ABBV), which has seen its share price plunge more than 30% from its all-time high. As a result, the stock's yield is now at a record high of 5.2%, and shares trade at just 9.9 times forward earnings. Whenever a dividend stock's price crashes this severely, income investors naturally want to know whether it could be a great buying opportunity or is the market's way of warning that the payout may no longer be safe. At the very least, such severe price declines can signal that a company's long-term thesis is broken. Let's take a look at why the market has been so bearish on AbbVie and whether this high-yield stock [...]

Founded initially in 2002, Energy Transfer LP (ET) was formed out of the $27 billion all-stock merger of MLP Energy Transfer Partners (ETP) and its sponsor Energy Transfer Equity (ETE) in October 2018. Energy Transfer is one of the largest integrated midstream MLPs in America. The firm owns a sizable network of assets that gather, process, transport, and export oil, gas, and natural gas liquids (NGLs), as well as liquified natural gas (LNG).

Income investors are often attracted to mouthwatering yields, and L Brands' (LB) 7% payout certainly qualifies. Founded in 1963, L Brands operates over 3,000 company-owned retail stores, primarily under the Victoria's Secret and Bath & Body Works brands. Most of its locations are mall-based. By building up dominant brands in the lingerie, beauty, and fragrance niches, L Brands has been a great success story over the last few decades. In 1993, L Brands ran 545 company-owned Victoria's Secret stores and had 121 Bath & Body Works locations. Today its Victoria's Secret locations have more than doubled to 1,165 stores, and Bath & Body Works' footprint ballooned over 10 times to a whopping 1,703 shops. Along the way L Brands also [...]

On October 16, IBM (IBM) reported disappointing earnings that sent shares plunging nearly 8% the next day. This week shares continued tumbling after IBM announced plans to acquire software company Red Hat (RHT) for $34 billion. As a result, IBM's stock now trades at its lowest price since 2009, and its other valuation metrics also make it, at least initially, appear like a bargain hunter's dream stock: Forward P/E Ratio: 8.2 (lowest in over 10 years) Dividend Yield: 5.4% (all-time high) But given that IBM's shares peaked in mid-2013 and have since fallen more than 40% from their all-time high, long-term investors have still suffered mightily over the years. Even accounting for the company's generous and growing dividend, since its [...]