Fly Carefully With Babcock & Brown Air

Stocks with high dividend yields can be tempting for cautious investors seeking steady payouts. But they also often come with caveats.

Take the newly public Babcock & Brown Air(FLY Quote).

The Ireland-based aircraft-leasing firm went public last week at $23 per share, and has said it plans to pay a quarterly dividend of 50 cents starting in 2008. That amounts to an 8.7% dividend yield based on share price, which has stayed around $23 since the initial public offering. ...