U.S. Currency Comptroller to Reconsider Update to Fair Lending Rule
Let’s talk about defending your wallet. It’s a common impulse for most investors when the economy starts to take a turn for the worse. We are now in a growth phase, with economic activity rebounding strongly after the closures of the corona crisis, and with the reopening in full swing, economists are forecasting GDP expansion of up to 8% this year. But there are clouds on the horizon. Inflation is on the rise and the April jobs report was, quite simply, a disaster. The Biden administration is proposing multibillion-dollar spending plans that could spur inflation, while rising unemployment benefits give the unemployment rate an artificial boost. But with all this, the Federal Reserve signaled that it had no intention of raising interest rates. Writing from investment banking firm Canaccord, analyst Tony Dwyer acknowledges the volatile market conditions. “Although major stock indexes remain near record highs, there has been incredible volatility below due to confusion around the trajectory of inflation and the Federal Reserve’s insistence that it is transient. We expect rotational volatility to continue over the coming weeks as investors debate the inflation outlook ahead of the latest economic data in early June as the Fed enters its quiet period ahead of the FOMC June 15-16, “Dwyer noted. All of this adds up to a market environment that lends itself to defensive actions, as a hedge against uncertainty. And that, of course, brings us to dividend-paying stocks. . These are the classic defensive games, giving investors a double path to returns, both from stock appreciation and dividend payouts. Wall Street analysts have been part of the work for us, identifying dividend paying stocks that have maintained high returns, at least 7% to be exact. Opening the TipRanks database, we take a look at the details of two of these stocks to find out what makes them attractive buys. Black Stone Minerals (BSM) We will start with a hydrocarbon exploration and development company, Black Stone Minerals. This company owns rights to more than 20 million acres, spread over 60 production basins in 40 states. The lion’s share of operations are spread from Texas to Alabama, but Black Stone also holds hydrocarbon rights and production in Montana and North Dakota, West Virginia and Pennsylvania, as well as the United States. of the Rockies. Black Stone released its financial results for 1Q21 in early May. The results showed the company still hasn’t fully recovered from the COVID pandemic – revenues and profits are still declining year over year. On a positive note, revenues posted three consecutive quarters of sequential increases. Revenue was $ 87.1 million and net profit was reported at $ 16 million. The company reaffirmed its borrowing capacity through its revolving credit facility during the quarter at $ 400 million. During the quarter, Black Stone entered into several new development deals on properties in Texas and acquired mineral rights and royalties, for $ 20.7 million in cash and stock, in the northern part of the Midland Basin. . Also during the quarter, Black Stone declared a dividend of 17.5 cents per common share. At the current rate, the common stock dividend pays 7.07% and has an annualized payout of 70 cents per common share. Raymond James analyst John Freeman is impressed with Black Stone’s first quarter development deals and writes of the company: “BSM had an incredibly strong first quarter where it… announced another round of development agreements in the Austin Chalk & Shelby Trough as well as its first acquisition since the pandemic. We have already seen phenomenal results early in the development of the Austin Chalk and we expect more significant near-term well catalysts, this time from the Shelby Trough… ”The analyst summed up:“ Due to the strong progress, we are increasing our production estimate for 2021 to the top of the BSM guide (up 3%) and now model a return to growth in 2022 (up around 4% compared to the previous declining model approximately 1%). offers an attractive payout yield and a rock solid balance sheet. ”Unsurprisingly, Freeman rates the stock as a strong buy and sets a price target of $ 15 suggesting a rise of around 50% for the coming year (To check out Freeman’s track record, click here) Overall, Black Stone has attracted the attention of 5 Wall Street analysts, whose reviews break down 2-3 buys versus holdbacks and give the stock a Moderate buy consensus rating. The stocks are selling for $ 9.90; they have an average price target of $ 11.40, indicating a 15% upside margin over the next 12 months. (See l (BSM Stock Analysis on TipRanks) Blackstone Mortgage Trust (BXMT) If we look at dividend-paying stocks, we will naturally be drawn to real estate investment trusts (REITs). These companies, straddling property managers and financial services, are known for their high dividend yields and the reliability of their long-term dividends. Both stem from a regulatory requirement that REITs return a certain percentage of profits directly to shareholders. Dividends are a convenient mode for compliance. Blackstone Mortgage focuses on secured senior mortgages in the North American, European and Australian markets. The company has a real estate portfolio of more than $ 368 billion in global value and a total of $ 649 billion in assets under management. Total assets under management include $ 196 billion in real estate assets. While BXMT’s revenue recently posted sequential declines, first-quarter revenue was still $ 185.75 million, and EPS, at 54 cents per share, was up dramatically from the loss of 39 cents recorded in the quarter of the previous year. During the first quarter, Blackstone closed $ 1.7 billion in new home loans, exceeding its total loan issuance for 2020. The company also declared $ 1.1 billion in free cash. The good results supported the dividend payment of 62 cents per common share. The dividend has been paid at this rate since 2H15 and the company has maintained reliable payments for the past 8 years. At the current rate, the dividend is annualized to $ 2.48 per share and gives an impressive yield of 7.74%. BTIG analyst Tim Hayes takes a bullish stance on Blackstone, noting: “The pipeline is strong and management expects earnings to benefit from continued portfolio growth and higher commission income as they grow. that the assemblies / reimbursements are normalized. ROEs on new creations are expected to be in line with pre-pandemic levels as lower funding costs offsets the pressure on asset returns. Credit performance remains solid and continues to move in the right direction…. BXMT recognized 100% interest recovery in 1Q21, 98% of loans in progress [sic]… ”The analyst concluded:“ We believe that stocks are attractively valued, are currently trading at a discount to historical multiples, and offer a dividend yield of 7.7% – a variation of ~ 600bp from historical multiples. the yield on 10-year US Treasury bills compared to the 2-year. average prepandemic spread of ~ 475 bp. Based on the above, Hayes values BXMT shares a buy with a price target of $ 35. Based on the current dividend yield and expected price appreciation, the stock has a total return profile. potential of around 16%. (To check out Hayes’ track record, click here) Like BSM above, BXMT has 5 analyst reviews, with 2 to buy and 3 to keep, for an analyst consensus rating Moderate buy. (See BXMT stock analysis on TipRanks) To get great ideas for dividend-paying stocks traded at attractive valuations, visit TipRanks’ Best Stocks To Buy, a recently launched tool that pulls all the information together on the shares of TipRanks Disclaimer: Opinions expressed in this article are solely those of the analysts presented. The content is intended to be used for informational purposes only. It is very important to do your own analysis before of f area any investment.