This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Invest with the Legends in GE, KKR and Icahn Enterprises

NEW YORK (TheStreet) -- My father, who worked in finance for over five decades, used to say, "There are always good buys in the stock market." This year will be no different, even though the Standard & Poor's 500 Index is down more than 3% for 2014.

If that trend continues, investors could have the opportunity to accumulate shares of high-beta, high-dividend blue-chip stocks such as General Electric (GE - Get Report), Icahn Enterprises (IEP - Get Report) and Kohlberg Kravis Roberts (KKR - Get Report) that should result in attractive long-term returns.

Each of these companies has a dividend yield above the average of 1.9% for a member of the Standard & Poor's 500 Index, and a beta that is greater than 1.

With a beta above 1, the share prices move up and down more than the stock market as a whole. For a patient investor, that allows for buying on the dips. When the price of the stock is lower, the dividend yield is that much higher.

For long-term investors, the stock price should return and rise higher for these entities.

General Electric, a member of the Dow Jones Industrial Average, is a global conglomerate. Its divisions, ranging from finance to water treatment to energy management, operate in more than 160 countries around the world. Earnings-per-share growth is steady and on a bullish trajectory at 6.50% for this year, 6.87% predicted for next year, and 8.48% projected for the half decade ahead. The dividend payout ratio is just 37.40%, so the company will have no problem funding its 3.48% dividend. With a beta of 1.78, patient investors should be able to buy the stock when it declines.

Another conglomerate, Icahn Enterprises has interests in the investment, automotive, railcar and home fashion business, among others. Icahn Enterprises operates differently than General Electric in that it owns separate companies, much like Berkshire Hathaway (BRK.A), the holding company for Warren Buffett, rather than operating different divisions. On a quarterly basis, both sales and earnings-per-share growths are strong. So is the dividend yield at 3.60%.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
GE $26.90 -0.46%
IEP $90.93 0.18%
KKR $23.12 -0.34%
AAPL $127.16 -0.34%
FB $84.14 1.30%

Markets

DOW 18,037.54 +2.61 0.01%
S&P 500 2,105.22 +4.82 0.23%
NASDAQ 5,019.3360 +24.7340 0.50%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs