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3 High-Yield Oil Stocks to Pump Out Profits

SDRL, BTE and BPT offer big income for long-term investors

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3 High-Yield Oil Stocks to Pump Out Profits


sdrl 3 High Yield Oil Stocks to Pump Out ProfitsDividend Yield: 8.8%

If you like smaller oil stocks with a big dividend, I recommend Seadrill (NYSE:SDRL), an offshore drilling contractor with a nearly $19 billion market cap. Its dividend is a bit volatile and unreliable, but adding up the last four paydays produces an 8.8% yield based on current prices.

Furthermore, revenue is slowly creeping up and earnings per share are much more stable. The dividend payout ratio is admittedly a concern since it’s pushing above total earnings per share this fiscal year, and there’s a risk that distributions might roll back if earnings don’t keep pace. But you could take a 40% haircut on your dividends and still enjoy a yield over 5% in SDRL stock. Seadrill is up about 8% year-to-date in 2013.

Unlike a lot of speculative small caps, Seadrill is both big enough to be entrenched and agile enough to ramp up growth in a good environment.

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