8 Small-Cap Dividend Stocks With Growth Prospect On High Profitability

  on Jun 22,2012 Posted in Dividend Ideas ,Investment Ideas ,Premium ,Small Cap Ideas
 
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Businesses of all sizes are facing new challenges because of the tight economy. Profit margins are on everyone’s mind, and small businesses are especially at risk to hiccups in revenue. If you are investing in a company that belongs to an industry that is known for high profit margins then these companies may add value to your investment portfolio.

High dividend yield stocks are alluring for buy & hold longer term positions because the cash payout offers a good margin of safety for the investment. These small cap financial stocks can be eye-catching for active long term investors as they offer good dividend payouts (at least 10%), high growth in operating margin (above 25%) and net margin (above 20%).

Main Street Capital Corporation (NYSE:MAIN) is a principal investment firm primarily focused on providing customized debt and equity financing to lower middle market (LMM) companies, which it generally defines as companies with annual revenues between $10 million and $100 million that operate in diverse industries. This company pays out a handsome dividend of about 7.40% and its current market worth is $636.80 million.

Right now, its price is 26.76% higher than its 52-week low, and the overall market sentiment looks positive for this stock. MAIN has an operating margin of 60.92% over the last twelve months, also a good sign for its financial condition.

Washington Federal Inc (NASDAQ:WAFD) is a $1.74 billion company. WAFD is a non-diversified unitary savings and loan holding company that conducts its operations through a federally insured savings and loan association subsidiary, Washington Federal Savings (the Bank).

The company pays out an attractive dividend of 1.96%. The overall market sentiment appears positive as the company’s stock price is 18.42% higher than its 52-week low. It has an operating margin of 45.80% and net margin stands at 29.31%, a clear sign for the company’s financial strength. Recently, the stock’s trading volume was higher than average.

Banco Santander, S.A. (ADR) (NYSE:SAN) is a Spain-based financial institution primarily engaged in retail banking. Banco Santander,  offers various deposit products, such as demand and time deposits, and savings and current accounts; repurchase agreements; mortgages and personal loans; consumer finance; and telephone banking services, and online and mobile telephone banking services. SAN valued at $57.46 million and pays a nice dividend of 13.37%. At $6.09 a share, the price was 11.89% above its 52-week low, usually a positive technical indicator on the company.

On Friday, the stock was traded actively and it should be good enough for your watch list, but particularly attractive based on its overall financial records.

ARMOUR Residential REIT, Inc (NYSE:ARR) is worth $1.24 billion and is an externally-managed Maryland company managed by ARMOUR Residential REIT, Inc. (ARRM). Recently, shares traded at $6.96 which is 5.40% above the 52 week low, a positive technical indicator. The stock maintains a good dividend payout ratio of 263.56%.

The company is financially strong and has an operating margin of 60.67% and the net margin stands at 60.65% while keeping liquidity ratios high enough to meet short term obligations. ARMOUR invests primarily in hybrid adjustable rate, adjustable rate and fixed rate residential mortgage backed securities issued or guaranteed by a United States Government-sponsored entity (GSE), such as the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), or guaranteed by the Government National Mortgage Administration, a United States Government corporation (Ginnie Mae) (collectively, Agency Securities).

Newcastle Investment Corp (NYSE:NCT) is a real estate investment and finance company. This company pays out a handsome dividend of about 13.01% and its current market worth is $763.69 million.

Right now, its price is 7.31% above its 52-week low, the overall market sentiment looks positive for this stock. NCT has an operating margin of 60.42% over the last twelve months, a good sign for its financial condition.

CYS Investments Inc (NYSE:CYS) a $1.57 billion company and CYS Investments, Inc. is a specialty finance company created with the objective of achieving consistent risk-adjusted investment income..

The company pays out an attractive dividend of 169.95%. The overall market sentiment appears positive as the company’s stock price is 14.28% above its 52-week low. It has an operating margin of 81.96% and net margin stands at 120.08%, a clear sign for the company’s financial strength. Recently, the stock’s trading volume was higher than average. CYS is a non-diversified unitary savings and loan holding company that conducts its operations through a federally insured savings and loan association subsidiary, Washington Federal Savings (the Bank).

Starwood Property Trust, Inc (NYSE:STWD) is a holding company and conducts its business through its subsidiaries. STWD valued at $1.94 billion and pays a nice dividend of 8.47%. At $20.79 a share, the price was 21.79% above its 52-week low, usually a positive technical indicator on the company.

Anworth Mortgage Asset Corporation (NYSE:ANH) is worth $953.48 million and ANH is a real estate investment trust (REIT). Recently, shares traded at $6.95 a share which was 5.63% above the 52 week low, a positive technical indicator. The stock maintains a good dividend payout ratio of 104.32%.

The company is financially strong and has an operating margin of 54.81% and net margin stands at 54.81% while keeping liquidity ratios high enough to meet short term obligations. The Company is engaged in the business of investing primarily in United States, or the United States agency mortgage-backed securities (agency MBS).

Disclosure: The views and opinions expressed in this article are exclusively those of the authors who have no stake in any stocks mentioned, and hold no plan to acquire any stake within the next 5 days.

 



 

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