Here are five everyday investor dilemmas and my easy stock solutions.
Dilemma: You need cash flow, but it’s a scary world. A ten-year Treasury pays just 1.8%. If you are prepared for some risk, junk bonds pay about 5%, but they tend to get whacked when interest rates rise. Same with lower-yielding but higher-quality corporate bonds.
I have long advocated a safer approach if yield is what you crave. Buy big-cap stocks. I like America’s largest wireless carrier, Verizon (VZ), which has a 4.75% dividend yield. With Verizon, you can expect single-digit growth from a diversified group of consumer and business offerings, plus a boost from added wireless spectrum.
Like any stock, Verizon isn’t immune to short-term volatility, but in the long term it will deliver. It’s cheap at 1.1 times annual sales and 15 times my estimated 2014 earnings. Beats T bonds by a mile.
Also check out:
- Ken Fisher Undervalued Stocks
- Ken Fisher Top Growth Companies
- Ken Fisher High Yield stocks, and
- Stocks that Ken Fisher keeps buying