|Ocean Shipping and
Shipping Securities were BIG yield plays prior to 2010 because of their corporate structure. (Although as of 2010 most
dividends have been eliminated)
WE MUST understand the tax laws under which these companies operate. This is critical because to pay out the very
high dividends (yields) the company must be exempted from Federal Income taxes
Here is the basis of the tax advantage most of these companies have--
Section 883 of the Internal Revenue Code of 1986 states -- qualified income derived from International
Operations of ships is excluded from gross income and exempt from U.S. Federal Income Taxes if a company
engaged in the International operation of ships meets certain requirements.
A key item is that the company must be incorporated in a country that grants like exemption to U.S.
This requirement is KEY. Without the tax exemption the high dividends (high yields) WILL NOT be able to be paid.
BELOW we note the tax status of the corporation next to the country of incorporation
It is the intention of most of the companies listed below to pay out all--or most of their operating income in
the form of dividends.
Before investing in any of the corporations listed below be aware of the other key research items you need to check up
1--Ship 'day rates' for the type of ships owned by a company. Is the trend up or down? What is the forecasted demand
2--Economic conditions---i.e. fuel prices--i.e. the need for feed grains around the world
3--The amount of time any given ship will be in dry dock for maintenance---does a company have a large share of their
fleet needing repairs that have previously been delayed?
4--the length of time the companies ships are chartered for and at what rates?
AS of 8/10/2010 the Shipping securities are not any longer great income securities---they likely will be at some point in
time in the future--but only once the economy recovers
Price Quotes and Yields are current and live. Dividends shown are for the last quarter--annualized. These dividends
change almost monthly so make sure to check the company website for the latest dividend.
Clicking on the ticker symbol will take you to the companies website.
|Copyrights SGM Publishing
|The Yield Hunter
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