This briefing is going to get me in trouble…

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Don't Let these Dividend Traps Destroy Your Nest Egg

Photo: Louis Navellier

Dear Investor,

In the first special report I sent you on Wednesday, 27 Dividend-Paying Stocks to Sell Now, I warned you about risky dividend-paying stocks that failed my test

Then yesterday I exposed the dangers of Private REITS, a risky investment scheme luring in investors with false promises of safety and a double-digit yield.

Today I want to warn you about another risky investment that promises income but can instead hand you big losses: dividend traps.

As we’ve discussed, this low-rate environment is driving hungry income seekers into the arms of risky high-yield investments.

Companies know investors are desperate for income, and that’s why we are seeing a growing number of dangerous “dividend traps.”

These dividend traps are companies with weak fundamentals that offer above average yields to entice investors, and artificially prop up their share price. These stocks lure investors in with big, juicy dividend of 6%, 8%, even 20%.

But a big yield can’t make up for huge losses in capital. And that’s exactly what’s happening to people who fall for that big yield and ignore the fundamentals.

Take a look at some of the high yielding stocks that have tanked over the course of this year…

Teva Pharmaceutical’s 4% dividend didn’t come close to making up for the stock’s 46% plunge.

Abercrombie & Fitch’s 7.9% yield didn’t come close to making up for a 55% stock loss.

Ericsson was paying 7.8%—but the stock plunged 36%.

Please do NOT get caught chasing yield and ignoring fundamentals! Fundamentals still matter, and will actually be more important than ever in the months ahead.

As I’ve been poring through the results of my latest stock analysis, I’ve been on the hunt to ferret out dangerous dividend traps.

Here are 24 companies I’ve identified that are paying very attractive high yields, but simply don’t have the fundamentals to back them up. If you own any of them, sell now, or risk getting hit with big losses in the weeks and months ahead.

Stock Name Ticker
% Yield Dividend
Grader Rating
Abercrombie & Fitch ANF 5.92% F
Air Castle Limited AYR 4.87% C
AMC Entertainment Holdings AMC 5.99% F
American Eagle Outfitters AEO 4.09% D
AT&T T 5.48% C
Barnes & Noble BKS 8.63% C
Cedar Fair FUN 5.35% D
CenturyLink Inc. CTL 11.65% F
Crown Crafts CRWS 4.89% C
DSW DSW 4.21% C
Frontier Communications Corp FTR 40.43% F
Gannett Co GCI 7.65% F
Guess? Inc GES 5.70% F
Liberty Tax TAX 4.64% C
Libbey Inc. LBY 5.91% D
Mattel, Inc MAT 8.44% F
Meridian Bioscience VIVO 4.14% F
New York Community Bancorp NYCB 5.74% F
PennyMac Mortgage PMT 11.33% D
Qualcomm QCOM 4.43% C
Regal Entertainment Group RGC 5.97% D
Staples, Inc SPLS 4.69% F
Tailored Brands TLRD 5.91% D
Tupperware Brands Corp TUP 4.69% D

In these first 3 special briefings, I have tried to help you avoid the biggest risks income investors face today, warned you about private REITs, and given you the names of more than 50 specific stocks to sell and avoid.

There is simply no reason to sacrifice safety, give up growth and put your initial investment at risk in the search for income.

Now that you know how to protect yourself from these risky investments, it’s time to talk about the best places for your money today.

I’m confident we haven’t yet seen the end of the bull market and I firmly believe there is a ton of money to be made in the coming months.

In my final briefing, which I’ll send to you on Monday, I’m going to show you exactly what to do in the next 11 days to make sure your money is positioned for the biggest profits in the fourth quarter and beyond.

I’ll show you where to invest for safe, reliable income… how you can triple your income overnight… what every investor need to know about the Fed’s big plans… and how to profit from President Trump’s coming $2.5 trillion windfall!

This next briefing is the most critical of them all. So enjoy your weekend and watch for an email from me Monday morning at 8 a.m. with all the details.


Louis Navellier
Navellier Growth

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