Moving Day

In light of our mention yesterday of high and low-tax states, a reader says:

“I moved from a mixed-tax state (OK) to tax-friendly state (AL). I had a small business. Never a tax problem in OK, but Alabama’s revenue grab is aggressive and every town demands a local tax permit. I had to give up the business.”

That’s a shame. When “aggressive” taxes become regressive, right?

“Two comments on tax friendly states: perhaps Kiplinger’s hypothetical case of a couple with $150,000 income and $10,000 in dividend income justifies their conclusions; however, as a retired couple on a fixed income living in the “People’s Republic of California,” I see no way that CA is not in the top 10 LEAST friendly states. 

“Perhaps KIplinger should break down their conclusions by a variety of income categories. How typical is their sample case? Never in our lives did my wife and I earn over $100,000.”

We, too, were shocked California didn’t break the top-ten. And you might have a point about Kiplinger’s sample.

Your Rundown for Wednesday, October 23, 2019:

Dividend Aristocrats

Dividend Aristocrats are a bundle of S&P 500 securities that have increased their dividends for at least 25 years in a row.

What’s more, these stocks have mostly beaten the broader markets in total returns for the past five years.

Here’s the catch: Of the 57 Dividend Aristocrats, 40% offer dividend yields below 2%. (Doesn’t exactly blow your socks off.)

But there are three companies topping the list that have serious passive income-generating potential:

  1. Pharmaceutical company AbbVie (ABBV)
  2. Telecom AT&T (T)
  3. Gas and oil giant ExxonMobil (XOM)

All three companies have an annual dividend yield greater than 5% — with AbbVie leading the pack at 5.6%, AT&T at 5.3% and ExxonMobil at 5.2%.

While we can make the argument that all three of these Dividend Aristocrats are profitable and worth the investment, AbbVie’s a standout.

The pharmaceutical company manufactures a diverse lineup of medications — that’ll only benefit from the company’s recent merger with Allergan — and offers the richest payout with a winning valuation; its dividend should be safe for the long-term.

Market Rundown for Wed. October 23, 2019

S&P 500 futures are down 3 points to 2,991.

Oil is down 75 cents to $53.73 for a barrel of West Texas crude.

Gold’s up $9.10 to $1,496.65 per ounce.

Bitcoin’s down 5.6% to $7,639.71.

Have a great day; we’ll talk tomorrow.

For the Rundown,

Aaron Gentzler

Aaron Gentzler

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Aaron Gentzler

Aaron Gentzler is the publisher of Seven Figure Publishing. He is also the editor of The Rundown and has been with Agora Financial / Seven Figure Publishing since 2005. He's been covering technology and markets for over a decade.

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