4. Mesabi Trust (MSB - Get Report) is a grantor trust with iron ore properties in Minnesota. It derives income from the properties and distributes it to holders. It yields 4.2% with a three-year distribution growth rate of 18%.
12-Month Net Income Growth: 286%
Cash Flow Multiple: 25 (at peer parity)
Quarterly Operating Profit Margin: 98%
Analyst Opinions: Mesabi is an unusual investment product with seemingly outdated rules. It will continue to pay distributions until the resources at its properties are exhausted. Estimating when that will be is a daunting task. Lured by yield, investors poured into the trust in 2010. Its forward earnings multiple of 19 is on par with the metals and mining industry average. This is a unique investment and its yield is no longer high enough to justify the idiosyncratic risk.