Collect Rock-Solid Dividends from This High-Yield Stock
Finding a balance between yield and safety seems to be a
perpetual theme in income investing. It’s easy to find stocks with ultra-high
yields; all you need is to use one of the dozens of stock screeners available
on the Internet. What’s more difficult is finding high-yield stocks that are
actually worth owning, because as income investors, the last thing you want is
to buy a high-yield stock before its dividend is cut.
And that’s why Omega Healthcare Investors Inc (NYSE:OHI) is
special. The company pays generous dividends with a 7.9% yield, and its payout
is more than safe.
As the name suggests, Omega is in the healthcare business.
But the company does not actually manufacture drugs or run hospitals. Instead,
Omega invests in healthcare real estate. In particular, the company provides
financing and capital to operators of skilled nursing facilities and assisted
living facilities.
Right now, OHI stock’s portfolio consists of investments in
986 facilities located in 42 states and in the U.K. The company’s business is
done through triple-net leases. This means healthcare operators, rather than
Omega, are responsible for paying the property taxes, insurance, and maintenance
on these buildings.
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