The past few years, I’ve urged readers to study a little-followed group of businesses I consider “cash cows.” Large investors generally ignore this area of the market, but for dividend investors, it’s an extraordinary place to shop for high-yield stocks. These companies represent mature businesses. Because they have less in the way of growth potential, management has no reason to invest in new factories, plants, or equipment. For this reason, executives pay out most of their cash flows to shareholders. And as a result, it’s not uncommon to see these stocks pay yields as high as 21%.
It appears this opportunity won’t last forever, though. Recently, research analysts at Bank of America initiated coverage on one of my favorite such cash cows: Iron Mountain Inc (NYSE:IRM). I’ve also noticed the company getting more attention in the financial press. Iron Mountain Inc specializes in storing documents and other valuables for corporate clients. The company operates more than 1,400 facilities worldwide totaling some 85 million square feet. To put that number into perspective, that’s enough space to hold 600 Costco Wholesale Corporation (NASDAQ:COST) stores laid end-to-end.
Source: Income Investors
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