2 Ultra-High-Yield Dividend Stocks That Are No-Brainer Buys in February

Investing in dividend stocks can be a great way to generate passive income and grow your wealth over time. However, not all dividend stocks are created equal, and some may be better suited for your portfolio than others. In this article, we will take a look at two ultra-high-yield dividend stocks that are no-brainer buys in February: Ford Motor Company (F) and PennantPark Floating Rate Capital (PFLT).

Ford Motor Company (F)

Ford Motor Company is a well-known automaker that has been paying dividends to its shareholders for many years. The company currently has a forward dividend yield of 6.06%, which is significantly higher than the average yield of the S&P 500. Ford's dividend has been growing steadily over the past few years, and the company has a strong track record of increasing its payout to shareholders.

One of the reasons why Ford is a no-brainer buy in February is its attractive valuation. The company's forward P/E ratio of 5.5 is a low-water mark for the decade, and it is valued at an 11% discount to its book value. This indicates that the stock is significantly undervalued compared to its historical averages and peers. Additionally, Ford has a strong balance sheet and a solid financial profile, which should allow it to continue paying and growing its dividend in the future.

Another reason to consider Ford is its strong truck sales. The company's F-Series has been the best-selling truck in America for 48 consecutive years and the top-selling vehicle, period, for 43 straight years. This strength in the truck segment contributes to Ford's overall profitability and growth potential.

PennantPark Floating Rate Capital (PFLT)

PennantPark Floating Rate Capital is a business development company (BDC) that invests in the equity (common and preferred stock) and/or debt of generally unproven small- and micro-cap companies. The company currently has a forward dividend yield of 11.25%, which is significantly higher than the average yield of the S&P 500. PennantPark's dividend has been growing steadily over the past few years, and the company has a strong track record of increasing its payout to shareholders.

One of the reasons why PennantPark is a no-brainer buy in February is its attractive dividend yield. The company's current yield of 11.25% is significantly higher than the average yield of the S&P 500, and it offers a substantial income stream for investors. Additionally, PennantPark pays its dividend on a monthly basis, which provides investors with a more frequent income stream compared to quarterly or annual payments.

Another reason to consider PennantPark is its debt-driven BDC structure. The company's portfolio is primarily invested in debt securities, which provides a stable and predictable income stream for the company and its shareholders. Additionally, PennantPark has a strong balance sheet and a low debt-to-equity ratio, which provides the company with the financial flexibility to continue investing in income-generating assets and paying its dividend.

Conclusion

In conclusion, Ford Motor Company (F) and PennantPark Floating Rate Capital (PFLT) are two ultra-high-yield dividend stocks that are no-brainer buys in February. Both companies have attractive valuations, strong dividend yields, and solid financial profiles that should allow them to continue paying and growing their dividends in the future. Additionally, both companies have strong track records of increasing their payouts to shareholders, which is a positive sign for long-term investors. By investing in these two dividend stocks, you can generate a substantial income stream and grow your wealth over time.