Recent Buy – CVA, OHI

I’m looking for companies that are fairly valued, have a decent dividend yield(3% to 6%) and have a fairly long history of paying dividends consistently for 10 years or more. However, there could be some cases for exceptionally good company or a strategic buy for a very long term.

1) Covanta Holding Corp. (CVA)

Covanta is involved in the conversion of  waste material to energy and renewable energy production businesses, more like utilities style. CVA is currently fairly valued, almost 20% lower than 52 weeks high of $17.16 and juicy dividend of almost 7%.

I added 25 positions in CVA at $14.10 on 5/05 to my existing 50 positions. It’ll add $25.00 of passive income on an annual basis, if there are no dividend cuts 🙂

2) Omega Heathcare Investors, Inc. (OHI)

Real Estate Investment Trusts (REITs) have been fluctuating due to concerns about rate hikes in the near term, likely two more this year, thereby driving their borrowing costs and margins. I consider it a risky buy but fairly valued. I added 25 positions in OHI on 5/19 at $32.92. It’ll add $63.00 in passive income on an annual basis that I do not need to work for.

Full Disclosure: Long on above mentioned securities.

Thanks for reading.

6 thoughts on “Recent Buy – CVA, OHI

  1. Hi PM,

    i agree with your opinion on OHI. I think about adding shares to my position during the summer. There is definitely risk (rate hikes and healthcare reforms), but with a yield of 6,25%, reliable div history and a solid div growth rate OHI offers a good risk/reward ratio.

    Kind regards,

  2. Hi, I’m long OHI and aside from the risk that you shared, I think OHI is a great REIT to own. Looking at F.A.S.T.Graphs, OHI actually seems to be trading a little below fair value based on the Price/AFFO (Adjusted Funds From Operations) multiple. Mmm… maybe I should buy more shares myself!

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