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Is there such a thing as a “perfect” stock? Probably not. Every company on the planet has some hair on it, whether it’s budding weakness in the balance sheet, increasing competition nipping at its heels, exposure to wild fluctuations in the foreign currency markets, or any of a long list of current or future threats.
But in today’s market environment, I think I’ve found the closest thing to a perfect stock there is.
First, it’s breaking out like crazy. You can see in the chart below that it’s taking out its high from back in early March. Moreover, those two blue lines represent a zone of resistance that goes all the way back to the mid-1990s and early 2000s! The fact it has cleared multiple levels of technical resistance means we could easily see this stock head from its current mid-$20s level to $30 — and beyond — before long.
Second, this stock is spinning off incredibly generous yields in an era of low interest rates the world over. Forget 2.5 percent for a 10-year U.S. Treasury, or the 3.6 percent you’re getting right now from the average utility stock or real estate investment trust (REIT). This name sports an indicated yield of almost 8 percent. High yields are a common thread among master limited partnerships, or MLPs, like this one.
Third, it’s not some high-risk company in a high-risk industry like biotechnology. Nor is it doing business in some far-flung country vulnerable to surging inflation, geopolitical chaos, massive currency fluctuations or any number of other threats.
It’s a company whose products you probably use, and whose employees and vehicles you probably cross paths with every week. Heck, our new neighbors own a catering business and they’ve just become customers of this firm.
Fourth, it’s not going to keep you up at night the way many super-volatile stocks can. If you compare this stock to the average company in the S&P 500 over the past three years, you get an adjusted beta of only 0.68. That’s a fancy way of saying for every 1 percent move in the S&P 500, this stock typically moves a little less than 0.7 percent. Stable, “steady Eddie” returns are the name of the game!
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| The perfect stock would be one that doesn’t keep you awake at night. |
Fifth, it’s levered to one of the strongest sectors in today’s market. I’m talking about energy, and more specifically, domestic energy. And finally, it’s rated “B” – or “Buy” by the Weiss Ratings system.
I first recommended this stock to my Safe Money Report readers back in March. They’re already sitting on open gains of 11.15 percent, including dividends — 13.7 times the rise in the S&P 500 during that same period of time. But as you’ve probably gathered, I believe this move is just getting started!
Naturally, I can’t share all the details here. It wouldn’t be fair to my paying subscribers. But you can find out more about “perfect” stocks — including this one — just by giving Safe Money a try! Click here or call us at 1-800-291-8545 and you can get on board for just $49 for a full year — 75 percent off the standard rate!
Not quite ready to take that step? Then I encourage you to at least explore master limited partnerships, or MLPs, in general. They’re a great cure for the disease of too-low yields and too-little income!
Until next time,
Mike
Mike Larson graduated from Boston University with a B.S. degree in Journalism and a B.A. degree in English in 1998, and went to work for Bankrate.com. There, he learned the mortgage and interest rates markets inside and out. Mike then joined Weiss Research in 2001. He is the editor of Safe Money Report. He is often quoted by the Washington Post, Reuters, Dow Jones Newswires, Orlando Sentinel, Palm Beach Post and Sun-Sentinel, and he has appeared on CNN, Bloomberg Television and CNBC.
