by Traders Reserve | May 11, 2013 6:00 pm
Come on admit it, you secretly love to invest in bubble stocks. Who doesn’t?
It’s wrong for every reason, but that doesn’t stop you. There’s money to be made before the bubble bursts, right?
We recently saw the gold market bubble, what was previously impenetrable, pierced. Oh well, it was fun while it lasted. Perhaps it’s time to find the next bubble. I think I found just the place.
If you haven’t been paying attention lately, here’s where the latest rage is happening: the previously sleepy little market of dividend stocks.
Just look around to see the number of articles being written about these stocks. The number of products emanating from Wall Street touting the benefits of dividend stocks is on the rise as well.
It’s all dividend stocks, all the time. The bus is leaving the station. It’s time to jump on board if you have not already done so.
The environment is rich for further inflation of the dividend bubble that is brewing. Not only are these companies paying healthy dividends, the stocks are appreciating greatly. More and more buyers searching for yield are coming into the market each and every day.
There’s plenty of fuel to keep these stocks moving higher.
The best part is we aren’t hearing a whisper about dividend stocks being a bubble – in fact, this article might be the first to associate dividend stocks with the word “bubble.” That alone tells me there is much more meat on the bone for us to chew on.
Get your dividend stocks while the bubble is still inflating.
Here are 5 to dividend bubble stocks to buy now:
What’s not to love about the oil business? The cash flow is insane and by paying that cash as a dividend, these companies are exploding like never before. Phillips (NYSE:PSX) shares are already up a fantastical 20%. Add in a 2% dividend and away you go.
It would take you years to get that sort of return owning a Treasury security. This run will feed on itself for some time as the return and the dividend attract future investors. I get giddy just think of what oil self-reliance in the United States would mean to the stock. Get in now while this bubble is getting larger.
This boring consumer stock is not so boring. Procter & Gamble (NYSE:PG) shares have jumped by 11% so far this year. This one pays a 3% dividend yield, pushing the total return to nearly 15%. Why settle for a paltry 2% or 3% return in Treasuries? When the rest of the market clues in to these juicy returns more buying ahead. They might be late to the party, but if you get in now you will likely get yours and theirs too. Isn’t that what a bubble is all about?
To think a simple little beverage would become this. Coca-Cola (NYSE:KO) is cash cow and a growing one at that, what with global expansion. Those overseas sales help the company pay a very healthy 2.7% dividend yield.
In 2013, shares of Coca-Cola have gained 16%. Put it all together and we are pushing 20%. Investors are buying Coke like it’s a drug…oh wait, it is a drug of some sorts. You have to love the addictive quality of the product. That alone ensures sales and growth that will keep this dividend bubble stock expanding.
Warren Buffett got in on this one early, but it is not too late for you to hit the rails. With the Federal Reserve pumping money into the economy, more and more shipping will take place. The natural gas and oil explosion will benefit CSX (NYSE:CSX), too.
In place of a pipeline, look for more of the energy complex to move via trains. CSX shares are up a whopping 27% so far this year. Don’t let that stop you from jumping on board. The company pays a 2.7% dividend yield that will attract investors for a long time – at least as long until this dividend stock bubble bursts.
Apple (NASDAQ:AAPL) just recently got serious about being a dividend stock, with its latest earnings report. Before that the company was struggling mightily, with shares down sharply. It is no coincidence that the stock has rallied some $70 since the announcement.
The fun has only just begun. In addition to a healthy dividend from this Fort Knox collector of cash, investors get to own one of the best technology innovators ever. In Apple we might be witnessing the quickest transition from momentum stock to dividend bubble stock. Blink and you might miss it.
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