Four weeks ago, I argued in this column that high-flyers Facebook (FB) and Amazon (AMZN) were my two favorite stocks despite their high price (P/E ratios) and that they don’t pay dividends. Fortunately, their prices have increased nicely since then. Today I’d like to recommend two beaten-down cheap stocks yielding hefty dividends that, of course, are tax free to anyone in the 15 percent tax bracket or below — couples with taxable income (after all deductions) less than $75,301 and singles under $36,651.
My favorite dividend stock is GM, the world’s largest car company, selling at only four times earnings (more than 75 percent below the market average of 18) and paying a terrific 4.9 percent dividend. Why would I recommend, as my second dividend-stock choice, an old-fashioned tech stock that, unlike fast-growing Amazon and Facebook, has seen its sales revenue decline for 17 quarters in a row? IBM reached its all-time high of $215 early in 2013 before plunging almost 50 percent to $117 February 11. (It has climbed back to the mid $150s and is now up 12 percent so far this year.)
Source: Winston-Salem Journal
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