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24/7 Wall St. Insights
While most of Wall Street focuses on large and mega-cap stocks, as they provide a degree of safety and liquidity, many investors are limited in the number of shares they can buy. Many of the most significant public companies, especially the technology giants, trade at prices up to $1,000 per share, while many are in the low to mid-hundreds. It is hard to get decent share count leverage at those steep prices.
Many investors, especially more aggressive traders, look at lower-priced stocks to make good money and get a higher share count. That can help the decision-making process, especially when you are on to a winner, as you can always sell and keep half.
For low-price stock skeptics, many of the biggest companies in the world, including Apple, Amazon, Netflix, and Nvidia, all traded in the single digits at one time.
We screened our 24/7 Wall St. research database, looking for stock trading under $5 that come with double-digit ultra-high-yield dividends that could offer patient investors enormous returns for the rest of 2024 and beyond. Five companies that hit our screens, making the total return potential even more intriguing. Dividend investors should also snap up this new report .
Why are we covering these stocks?
For investors with a smaller capital base, low-price stocks that pay large dividends are an incredible way to generate passive income and produce big total returns . At 247 Wall St., we consistently emphasize the potential of total return to our readers, as it is one of the most effective ways to enhance the prospects of overall investing success. Once again, total return is the collective increase in a stock's value plus dividends.
Cato Corporation
Cato Corporation is an American retailer of women's fashion and accessories.
Paying shareholders a gigantic 14.02% dividend, this company, founded in 1946, could attract value buyers at current trading levels. Cato Corp. ( NYSE: CATO ) and its subsidiaries operate as a specialty fashion apparel and accessories retailer in the southeastern United States.
It operates through two segments:
The company's stores and e-commerce websites offer a range of apparel and accessories, including:
- Dressy, career, and casual sportswear
- Dresses
- Coats
- Shoes
- Lingerie
- Costume jewelry
- Handbags
- Men's wear
- Lines for kids and infants
It operates its stores and e-commerce websites under these names:
- Cato
- Cato Fashions
- Cato Plus
- It's Fashion
- Fashion Metro
- Versona names
It also provides credit card services and layaway plans for its customers.
Orion Office REIT
Orion Office REIT specializes in the ownership, acquisition, and management of a diversified portfolio of mission-critical and corporate headquarters.
Trading under $4 with a massive 10.55% dividend, this company could double in price from its current trading levels. Orion Office REIT Inc. (NYSE: ONL) specializes in owning, acquiring, and managing a diversified portfolio of mission-critical and corporate headquarters office buildings in high-quality suburban markets across the United States.
The portfolio is leased primarily to creditworthy tenants on a single-tenant net lease basis. The company's team of experienced industry leaders employs a proven, cycle-tested investment evaluation framework, which serves as the lens through which capital allocation decisions are made for the current portfolio and future acquisitions.
The company was founded on July 1, 2021, spun off from Realty Income Corp. ( NYSE: O ) on November 12, 2021, and began trading on the New York Stock Exchange on November 15, 2021. The company is headquartered in Phoenix, Arizona, and has an office in New York.
Oxford Square Capital
Oxford Square Capital Corp. is a publicly-traded closed-end, management investment company.
With a huge 13.86 yield , trading under $3 this could be a huge winner. Oxford Square Capital Corp ( NASDAQ: OXSQ ) is a business development company that operates as a closed-end, non-diversified management investment company. It is a private equity and mezzanine firm that invests in both public and private companies.
It invests in secured and unsecured senior debt, subordinated debt, junior subordinated debt, preferred stock, common stock and syndicated bank loans.
The firm primarily invests in debt and/or equity securities of these companies:
- Technology-related companies that operate in the computer software, Internet, information technology infrastructure and services, media, telecommunications and telecommunications equipment
- Semiconductors, hardware, technology-enabled services
- Semiconductor capital equipment
- Medical device technology
- Diversified technology, and networking systems
It concentrates its investments in companies with annual revenues of less than $200 million and market capitalization or enterprise value of less than $300 million. The firm invests between $5 million and $30 million per transaction, with a clear strategy to exit its investments within 7 years.
Prospect Capital
Prospect Capital is a leading flexible private debt and equity capital provider.
Hedge funds love this top business development company, and the gigantic 14.68% dividend paid monthly makes it a potential total return home run. Prospect Capital Corp. ( NASDAQ: PSEC ) specializes in:
- Middle market, mature, mezzanine finance
- Later stage, emerging growth
- Leveraged buyouts
- Refinancing
- Acquisitions
- Recapitalizations
- Turnaround
- Growth capital development
- Capital expenditures
- Subordinated debt tranches of collateralized loan obligations,
- Cash flow term loans
- Market place lending
- Bridge transactions
It also invests in the multi-family residential real estate asset class. The fund makes secured debt, senior debt, senior and secured term loans, unitranche debt, first-lien and second-lien, private debt, private equity, mezzanine debt, and equity investments in private and microcap public businesses.
Prospect Capital focuses on both primary origination and secondary loans/portfolios and invests in situations such as debt financing for private equity sponsors, acquisitions, dividend recapitalizations, growth financings, bridge loans, cash flow term loans, and real estate financings/investments.
The company invests in the following sectors and business silos:
- Aerospace and defense
- Chemicals
- Conglomerate and consumer services
- Ecological
- Electronics
- Financial services
- Machinery and manufacturing
- Media
- Pharmaceuticals
- Retail
- Software
- Specialty minerals
- Textiles and leather
- Transportation
- Oil gas and coal production
In addition to favoring materials, industrials, consumer discretionary, information technology, utilities, pipeline, storage, power generation and distribution, renewable and clean energy, oilfield services, healthcare, food and beverage, education, business services, and other select sectors
Uniti Group
Uniti is an internally managed real estate investment trust that acquires and constructs mission-critical communications.
Way off the radar, this specialty company delivers a massive 10.68% dividend. Uniti Group Inc. ( NASDAQ: UNIT ) is an internally managed real estate investment trust engaged in acquiring and constructing mission-critical communications infrastructure and is a leading provider of fiber and other wireless solutions for the communications industry.
As of December 31 , 2023, Uniti owns approximately 140,000 fiber route miles, 8.5 million fiber strand miles, and other communications real estate throughout the United States.
Uniti is not resting on its laurels. The company recently announced a significant network expansion in Huntsville, Alabama, one of its existing 30 enterprise markets. This expansion, spanning approximately 70 route miles, is not just a move to increase its footprint. It's a strategic decision to support one of its hyperscale customers, demonstrating Uniti's forward-thinking approach and potential for future success.
Uniti provides multiple conduits and high-strand count fiber to its hyper-scale customer to connect key data center locations within the Huntsville metropolitan area and tie in diverse, long-haul routes connecting Huntsville to other regional and national data center markets.
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