Quintessentials: The Search For Yield Continues

With cash, bonds and term deposits all offering a yield well below 3%, investors continue to turn to the share market to find income. Peter Quinton has a number of criteria that he looks for to add to the panel of high-yield stocks. In no particular order they are: 1) a market capitalisation above $1b; 2) a forecast dividend yield of at least 4.5% (fully or mostly franked); 3) earnings per share and/or dividends per share growth in 2016 and 2017; 4) a dividend cover of at least 1.2 times, or for infrastructure stocks, a distribution coverage of at least 100%; 5) a strong balance sheet; and 6) a neutral or buy rating from the analyst. These demanding criteria have been used successfully for probably over 30 years. In this video, he explains why 3 out of 4 of the big banks don't make the list and provides the 7 stocks that meet the criteria.