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| BondsOnline.com: instant access to and extensive coverage of over 3.5 million stocks, bonds, indexes and other securities covering major and emerging markets and exchanges across the globe. |
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| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
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0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| More |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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Dividend Stocks vs. Same Company Bonds: What's the Better Investment? |
Seeking Alpha - May 23, 2011 - by Stephan Rosenman
Stocks compete with the bond market for investor dollars. Equities are often compared to 10-Year Treasuries: when notes have low yields, stocks are considered attractive. However, little attention is paid to a comparison of a company's stock dividend and its 10-Year bond yield.
A look at stock dividends and bond yields for the same company gives a treasure trove of information -- how well does the bond market think about a company's business and safety and whether the bond or stock has the more attractive pay out. Investors should therefore pay attention to the bond market. There are a number of companies in which bond holders are willing to lend money at low interest rates, literally allowing the businesses to turn themselves into free cash machines, churning out much higher dividend yields to shareholders.
Five companies--Altria (MO), AT&T (T), Kinder Morgan Partners (KMP), Kimberly Clark (KMP), and Verizon (VZ)--have dividends paying out greater yields than their 10 year bonds. Each of their 10 year bonds are selling at a premium, indicating that bond holders are eager to own these companies' debt. Holders are willing to take the risk of holding this debt out a decade, at relatively small pay outs, signaling that bond investors believe the five companies have sound businesses. The stock dividends of all five yield more than their 10 year bond counterparts, yet afford the possibility of dividend and stock appreciation.
Stock investors should take their cue from the bond market and feel comfortable in buying the five companies.
1. Altria: This tobacco company's 10 year bonds sell at a hefty $30 premium. Bond holders have bid these bonds way up, driving yield down to 4.63%. You can get a 5.48% dividend with the stock with a potential for increased future dividends and share appreciation. I suggest taking the higher stock yield instead of paying up for the bond.
For the complete article.
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| Stuff to look at |
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| BondsOnline Advisor |
Income Security Recommendation January 2013 Issue.
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