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5 High Performance Dividend Stocks

This article will review 5 dividend stocks to see if they could be strong long term investments. Each of these stocks pays a generous dividend and offers good potential for capital appreciation. Perhaps one or more of these stock could be a fit for your investment portfolio.

Terra Nitrogen Company LP (TNH) Terra Nitrogen has a market cap of $4.08 billion with a price to earnings ratio of 14.14. The stock has traded in a 52 week range between $101.21 and $239.79. The stock is currently trading around $218. The company reported fourth quarter revenues of $201 million compared to revenues of $143 million in the fourth quarter of 2010. Fourth quarter net income was $129 million compared to net income of $65 million in the fourth quarter of 2010.

One of Terra Nitrogen’s competitors is CVR Partners (UAN). CVR Partners is currently trading around $28 with a market cap of $2.06 billion and a price to earnings ratio of 33.76. CVR Partners pays a dividend which yields 8.1% versus Terra Nitrogen whose dividend yields 8.8%.

Terra Nitrogen produces and sells fertilizer products. The company increased year-over-year third quarter revenues by 40% and net income by 97%. Terra Nitrogen has been an enormous success story for its investors. In 2011, the company had a return on assets ratio of 106.27% and a return on equity ratio of 211.98%. Over the last five years, the company's return on investment has been around 506%. Terra Nitrogen has a strong balance sheet which shows zero debt. The company has paid dividends since 1992. The dividends have varied from quarter to quarter, and in the first quarter, the company increased the quarterly dividend by 14.3% to $4.53 per share. The stock price is moving higher, and has increased by 84% over the last 52 weeks and 18.8% over the last month. The stock of Terra Nitrogen is not cheap (price to book ratio 17.43/price to earnings ratio 14.24) but with its current rate of growth and high yield dividend the stock could still move higher. Prospective investors should do further research.

Health Care REIT (HCN) Health Care has a market cap of $10.44 billion with a price to earnings ratio of 60.47. The stock has traded in a 52 week range between $41.03 and $57.66. The stock is currently trading around $54. The company reported fourth quarter revenues of $407 million compared to revenues of $196 million in the fourth quarter of 2010. Fourth quarter net income was $44 million compared to net income of $27 million in the fourth quarter of 2010.

One of Health Care’s competitors is Ventas Inc. (VTR). Ventas is currently trading around $56 with a market cap of $16.17 billion and a price to earnings ratio of 35.51. Ventas pays a dividend which yields 4.4% versus Health Care whose dividend yields 5.4%.

Health Care develops and operates health care real estate properties. The company has been in an upward trend, and has increased its year-over-year fourth quarter revenues by 107% and net income by 62%. In the fourth quarter, earnings call the company’s CEO George Chapman touted the company’s strong relationships with top health care providers, as well as it sector leading occupancy rate 93% and retention rate 79%. The company has paid dividends since 1992 and has increased its dividend five times by 147% over the last 52 weeks. The current dividend is $2.48 per share. The company is unlikely to provide its investors with explosive stock growth, but it has provided 1-year and 5-year cumulative total returns of 21% and 71%, respectively. Health Care can be looked upon as a secure investment, with a healthy dividend, in a growing market sector. Prospective investors should do further research.

SeaCube Container Leasing (BOX) SeaCube has a market cap of $336.13 million with a price to earnings ratio of 8.89. The stock has traded in a 52 week range between $10.26 and $16.91. The stock is currently trading near the top of its 52 week range at just under $17. The company reported third quarter revenues of $45.23 million compared to revenues of $34.47 million in the third quarter of 2010. Third quarter net income was $8.7 million compared to net income of $4.8 million in the third quarter of 2010.

One of SeaCube’s competitors is TAL International Group Inc. (TAL). TAL is currently trading around $39 with a market cap of $1.29 billion and a price to earnings ratio of 11.69. TAL pays a dividend which yields 5.6% versus SeaCube whose dividend yields 5.8%.

SeaCube operates a shipping container leasing company. In the third quarter, the company increased year-over-year revenues by 31% and net income by 81%. SeaCube first traded on the NYSE on October 29, 2010. Since its IPO, the stock price has increased by 54%. The company paid its first dividend on December 30, 2010 and since that time it has increased its dividend two times by 20%. The company has been profitable in every quarter since the IPO and has also increased its revenues in every quarter since the IPO. The stock is currently in an upward trend, and the stock price has increased by around 13% over the last month. Despite the recent uptick in the stock price, the stock is still relatively cheap and has a hefty dividend yield. For investors that are interested in dividend stocks, SeaCube deserves consideration. Prospective investors should do further research.

Enterprise Products Partners (EPD) Enterprise has a market cap of $45.11 billion with a price to earnings ratio of 21.79. The stock has traded in a 52 week range between $36.00 and $52.95. The stock is currently trading around $52. The company reported fourth quarter revenues of $11.5 billion compared to revenues of $9.5 billion in the fourth quarter of 2010. Fourth quarter net income was $721 million compared to net income of $159 million in the fourth quarter of 2010.

One of Enterprises competitors is Spectra Energy Corporation (SE). Spectra is currently trading around $32 with a market cap of $20.66 billion and a price to earnings ratio of 17.55. Spectra pays a dividend which yields 3.5% versus Enterprise whose dividend yields 4.8%.

Enterprise is a North American pipeline company. In the fourth quarter, the company increased year-over-year revenues by 21% and net income by 353%. In 2011, the company increased its year-over-year revenues by 31% and net income by 525%. The company has also consistently increased its dividend. Over the last five years, the company increased its dividend in every quarter for a total increase of 32%. The current dividend is $2.48. The company has $6.5 billion in growth projects, which will help it take advantage of the oil and natural gas shale plays in the Rockies and the Eastern US. Investors have taken notice of the company’s impressive earnings growth, and have bid the stock up by 18.9% over the last 52 weeks and 194% over the last three years. Enterprise has been able to offer investors capital appreciation while maintaining a high yield dividend. Prospective investors should do further research.

Genesis Energy (GEL) Genesis has a market cap of $2.29 billion with a price to earnings ratio of 42.23. The stock has traded in a 52 week range between $20.85 and $31.99. The stock is currently trading near the top of its 52 week range at just under $32. The company reported fourth quarter revenues of $806 million compared to revenues of $602 million in the fourth quarter of 2010. Fourth quarter net income was $7.7 million compared to net income of $-74.56 million in the fourth quarter of 2010.

One of Genesis competitors is Plains All American Pipeline L.P. (PAA). Plains is currently trading around $82 with a market cap of $12.78 billion and a price to earnings ratio of 16.85. Plains pays a dividend which yields 5% versus Genesis whose dividend yields 5.5%.

Genesis is an oil and gas pipeline company that operates in the Gulf Coast area. Genesis has done a good job of increasing earnings. In the fourth quarter, the company’s revenues increased by $204 million and its net income increased by $82.3 million. In 2011, the company increased revenues by 259% and net income by over 200%. The company has paid a quarterly dividend since 1997. Over the last five years, the company has increased its dividend in every quarter for a total increase of 109%. The stock price which was relatively flat throughout 2011, has suddenly caught fire and has increased by 13% over the last month. This is despite the fact that on February 16th, the company missed revenue estimates by $9 million and earnings per share estimates by $0.20. Apparently investors have finally caught on to Genesis rapid earnings and dividend growth. Prospective investors should do further research.

About the author:

Dividend King
I am primarily an investor interested in creating passive income streams through dividends. I focus on finding and analyzing dividend paying stocks, MLPs and REITs that are a good fit for income investors.

I practice Judaism and my faith is very important to me. I visit family in Israel once a year, but I am educated and work in the United States where I hold an MBA and a bachelor’s in English. I am a patient man, enjoy wine but am not a connoisseur, and I listen more than I speak.

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