NEW YORK ( TheStreet) -- The Russian ruble has lost over 30% to the U.S. dollar over the last six months. Falling oil prices and continued economic sanctions from the U.S. and Europe have weakened Russia's currency. With uncertainty and panic selling comes great opportunity.
Winston Churchill famously said, "Never let a good crisis go to waste". It is time you take a look at these two Russian stocks with dividend yields over 10%. Both stocks are publicly traded in the U.S. and pay dividends in U.S. dollars. One has an eye-popping yield of 14.5%, while the other has a yield of over 11%. The two stocks below are not the low-risk, high quality businesses that are normally covered. Instead, they offer high potential returns and exceptional dividend yields, but come with serious risks.
CTC Media (CTCM)
CTC Media is one of Russia's leading television networks. The company's stock is currently yielding about 14.5%. You don't have to go hunting through the pink sheets to find information on CTC Media; the company's stock is publicly traded on Nasdaq. It is down nearly 65% for the year to date.
CTC Media operates three Russian television stations and one Kazakh station. The company generates virtually all of its revenue and profit from advertising. In total, CTC Media controls approximately 17% of total Russian television advertising market share. The company was founded in 1989 and has paid increasing dividends from 2012 to now.
CTC Media is trading at an absurdly low price-to-earnings ratio of 5.6. Other independent television broadcasters trade for a substantially higher price-to-earnings ratio than CTC media:
- Gray Television (GTN) -- price-to-earnings ratio of 28.8
- Scripps Networks (SNI) -- price-to-earnings ratio of 21.6
- AMC Networks (AMCX) -- price-to-earnings ratio of 20.5
CTC Media is trading at a price-to-earnings ratio of about one quarter of its U.S. counterparts. CTC Media has upside of up to 400% if fears about the Russian economy subside. CTCM has a price-to-earnings ratio hovering around 20 as late as mid 2013; there is historical precedence for CTC Media to trade at a price-to-earnings ratio around 20. Investors who load up on this stock now could see gains of 300% to 400% percent. CTC Media has grown operating income before depreciation at about 16% a year over the last decade.