Investors love dividend stocks, especially the high-yield variety.
The Dividend Harvesting Portfolio rebounded strongly post-election, with profitability increasing by $688.50, resulting in a 27.13% return on invested capital. I added to positions in Realty Income, Starwood Property Trust, and FS KKR Capital Corp, focusing on their strong dividend yields and growth potential. The portfolio's diversification strategy mitigates risk and enhances income, with a goal of generating $1,875 in forward dividend income by December.
FS KKR Capital Corp (NYSE:FSK ) Q3 2024 Earnings Conference Call November 7, 2024 9:00 AM ET Company Participants Anna Kleinhenn - Head of Investor Relations Michael Forman - Chief Executive Officer and Chairman Dan Pietrzak - Co-President and Chief Investment Officer Brian Gerson - Co-President Steven Lilly - Chief Financial Officer Conference Call Participants Bryce Rowe - B. Riley Securities Casey Alexander - Compass Point John Hecht - Jefferies Mark Hughes - Truist Kenneth Lee - RBC Melissa Wedel - JPMorgan Operator Good morning, ladies and gentlemen.
FS KKR Capital (FSK) came out with quarterly earnings of $0.74 per share, beating the Zacks Consensus Estimate of $0.70 per share. This compares to earnings of $0.80 per share a year ago.
24/7 Wall St. Insights As interest rates fall, ultra-high-yield stocks will grow in popularity.
BDC investing focuses on high current income streams, with less emphasis on price dynamics. As the yield component is a key value driver for BDCs, and also is usually quite high, the risk of stepping into a value trap is meaningful. In this respect, I have assessed two very high yielding BDCs.
FSK KKR Capital Corp offers a near 15% forward yield, supported by solid fundamentals and improved portfolio metrics, making it an attractive income investment. The company has shown significant improvements in non-accruals and has increased liquidity while decreasing debt, positioning itself well for future economic headwinds. FSK trades at a 17.24% discount to NAV, providing an attractive entry point compared to peers trading at premiums.
In an expensive market, Blue Owl Capital Corp. and FS KKR Capital Corp offer higher yields with solid fundamentals and safe dividends. OBDC's strong fundamentals, merger benefits, and low leverage ratio ensure reliable dividend coverage, even in a challenging macro environment. FSK's turnaround, solid dividend coverage, and investment-grade credit ratings position it well for a lower interest rate environment.
The headline numbers for FS KKR Capital (FSK) give insight into how the company performed in the quarter ended June 2024, but it may be worthwhile to compare some of its key metrics to Wall Street estimates and the year-ago actuals.
FS KKR Capital (FSK) came out with quarterly earnings of $0.75 per share, beating the Zacks Consensus Estimate of $0.71 per share. This compares to earnings of $0.78 per share a year ago.
24/7 Wall St. Insights Quality ultra-high-yield stocks offer passive income investors streams of revenue.
I'm quite cautious on the BDC sector right now. However, there are still some interesting opportunities in the space. I discuss two of the most overrated BDCs right now as well as two of the most underrated BDCs.