Rocky’s Weekly Stock Picks

This week we’ll be looking a little more closely at some of our monthly distributors. Long-term views with a buy-and-hold mindset is great, but we still need regular income!

If our picks seem boring and predictable this week, that’s because they are. If it ain’t broke, don’t fix it.

1. ARR - $5.09/share, ex-div 5/12. One of our favorite REITs, this is residential real estate with a monthly distribution of $0.08/share. Fixed amounts are a double-edged sword, and in this case we’re on the friendly edge.
   
   For comparison, two years ago we were paying $10+/share, with a $0.10 distribution. While still generous, it was far less competitive at that time. Looking forward, we fully anticipate 2024’s distributions to be reduced further (while expecting the share price to begin ebbing upward).

2. CLM - $7.85/share, ex-div 5/12, $0.1228 monthly distribution. The price over the last six months has come down significantly, in the ballpark of -50%. Meanwhile, the distribution has been reduced by only about -33%.
   
   While we do expect to see further correction that works against our position, we’re certainly satisfied for the time being. Once again having a fixed rate of distribution keeps us somewhere in the middle as far as returns go.

3. CRF - $7.45/share, ex-div 5/12, $0.1173 monthly distribution. Another Cornerstone fund, this follows basically the same pattern as CLM.
   
   You might argue that there’s no point in having both CRF and CLM in your portfolio. In this situation, our decision to buy into both is completely arbitrary.
   
   What it does allow you to do, however, is have basically two of the same investments and put half on a DRIP, while realizing the gain on the other half. Not a bad way to pay your margin interest.
   
   

4. EDF - $4.19/share, ex-div 5/10, $0.06 monthly distribution. This fund has seen better days, but we’ll just take the depressed price as a discount opportunity.
   
   The fund holds treasury securities in both the US, and friendly-ish 3rd world countries. We like Latin America and Indonesia. Especially Indonesia.
   
   
   

5. ECC - $11.50/share, ex-div 5/10, $0.14 monthly distribution. Eagle Point Credit has done consistently well in both generating current income as well as maintaining a share price.
   
   Solid.