A Monthly Dividend Stock That Yields 58%!
- Posted by
Ben Moreno in Monthly Dividend Stocks - 6 Comment
Right Now Harvest Energy Trust (HTE) is yielding a 58% monthly dividend! How is this possible? Here is how:
One thing you need to understand about dividend paying stocks is that their dividend percentage % increases as their share price goes down. As you would imagine, many dividend stocks have high yield percentages because many of their share prices are very low due to the current global economic issues.
I was doing some research (as always) on monthly dividend stocks using Yahoo Finance when I noticed HTE was yielding a 58% dividend. This is extremely high and should save the share price from dropping any further. This high of a dividend percentage can cause a shark frenzy type of buying. However, smart investors know to look at extremely high dividend percentages as a company in trouble but at the same time it is a very awesome buying opportunity.
The trick is to know if the company is really in trouble or if the price has declined temporarily. This is a catch 22 of course. It all depends on how much risk you are willing to stomach. If you are like me then risk is just an increase in adrenalin. 
Ok, maybe it’s not that bad but I must say that I am one of those people who like to take risks because I like to focus on the rewards. Not to mention when you do take risks despite what people say and you succeed, it is always fun to go back to them and say, "I told you so!".
The best way to look at this situation is by researching the company. Look at it’s history. Look at what the company produces. Harvest Energy is one of Canada’s largest energy trusts offering exposure to upstream oil and natural gas production and downstream refining and marketing operations. They have been around for a long time so I don’t see this company going anywhere anytime soon as well as our need for gas.
That being said, if you do own shares of this company and you reinvest the monthly dividends then you will be buying much more shares than you would have at the stable share price. So the longer you keep reinvesting dividends while the stock price is low and yeilding the same dividend, you are dramatically increasing your stake/long term value/compounding power! That is awesome!
Want an awesome dividend newsletter? Click Here!
Have you subscribed yet? Use the form below. If you prefer to use a reader, click here.
If you don’t know what this means click here.
6 Comments on this post
Trackbacks
-
Teeth Whitener (Who am I?) said:
Your post title really caught my attention! 58% dividend didn’t seem possible until you explained it. Thanks for the info.
3.1 March 11th, 2009 at 5:06 am -
Meeting rooms said:
Can one benefit from the HET even without having any shares in the company ? Obviously 58% dividend will interest anyone but how to go about it is where the problem is. It’s as simple when said.. But great info!
March 16th, 2009 at 4:21 am -
Ben Moreno (Who am I?) said:
Meeting rooms,
HTE is a company that refines petroleum products, so unless you work in that industry I guess they won’t benefit you that much. Yes, owning shares in this company has a great benefit of monthly dividends.
3.2 March 16th, 2009 at 8:54 am -
Patrick said:
Monthly dividend is 0.05 CAD ie yield is now 11,5 %.
Still high but not close to the mentionned 58%….April 8th, 2009 at 2:19 pm -
Ben Moreno (Who am I?) said:
Thanks for clarifying that. When I looked at it that day Yahoo was showing it at 58%. Maybe it was a mistake.
3.2 April 9th, 2009 at 11:07 pm -
Greg said:
All evidence shows that in your “researching the company, looking at it’s history and looking at what the company produces” you fail to read signs that the company would first reduce its dividend (total distribution for 2009 at Jan 1 price = 9.1%) and then discontinue it all together! Tell me what you buy next and I will short it!
December 21st, 2009 at 12:17 am