Are you wondering which dividend stocks outperformed in the first quarter of 2015? The past 6 months have been a roller coaster for many dividend stocks – thanks to the Crude Oil Crash, quite a few Energy-related stocks either trimmed or eliminated their dividends altogether.
The 7 top performers for Q1 2015 are a diverse group, ranging from publishing to business services, to apparel, to home furnishings, to Refining and Energy Services.
Interestingly, 2 of the top 3 performers in this group have a modest dividend yield of less than 2%, and a total of 4 out of 7 have low dividends:
PERFORMANCE: Other than Courier Corp., which is being bought out, the main catalyst for the outperformance of these stocks has been good earnings. (More about Alon's (NYSE:ALDW) possible buyout below).
Dividends: We’ve been tracking the 2 highest yielding stocks within this group in the Energy section of our High Dividend Stocks By Sectors Tables- CSI Compressco, (CCLP), and Alon Partners LP, (ALDW).
In fact, we wrote a few weeks ago about CSI Compressco LP (NASDAQ:CCLP), which has continued to rally since then.
CCLP yields over 9%, and expects to have major EBITDA growth in 2015:
ALDW, like many refining stocks, has also been able to bounce back, after its late autumn swoon. Generally, cheaper oil means cheaper feedstock for refiners to make gasoline and distillates, which improves refiners’ margins.
Two other catalysts were-
1. ALDW’s big dividend increase – it declared a $.70 distribution on February 6th, vs. an $.18 payout in the same period in 2014. It’s hard to say if this is an indication of future rate hikes or not, since ALDW pays variable quarterly distribution amounts throughout the year:
2. Also aiding ALDW’s price gains are the reports of a potential buyout from another stock in this group, DK Holdings, (DK). DK is in talks with the Alon Israel Co. Ltd., which is the largest shareholder of Alon USA, to acquire part or all of the Alon shares that it currently holds, approximately 49%.
((NYSE:DK) is the parent company of another high dividend stock we’ve written about, Delek Logistics Partners, (DKL), which is also listed in our Options Tables.
Options: Since its future distributions are impossible to predict, you may want to consider selling cash secured puts for ALDW, as it has fairly attractive put options yields that are below its price/share.
This August $175.0 put pays a bid premium of $1.05, which gives you a breakeven of $16.45.
Earnings Prospects: Low yielders Rocky Brands and Bassett Furniture appear to have the lowest combination of PEG values for this year and next.
Financials: ALDW’s financial ratios stick out, not only in this broad group of disparate stocks, but also vs. its industry averages:
Disclaimer: This article is written for informational purposes only, and isn’t intended as investment advice.
Disclosure: Author owned shares of CCLP at the time this article was published.