CCI - Crown Castle: This 6%-Yielding REIT Is No Sucker Yield

2024-05-19 21:06:36 ET

Summary

• Real estate sector has the highest dividend yield in the S&P 500 at 4.2%.
• Crown Castle has a current dividend yield of 6.1% but faces challenges with growth and high debt levels.
• Ongoing strategic review of CCI's fiber and small cell businesses aims to unlock shareholder value.

Introduction

As most of my readers may know, I am very careful when it comes to elevated dividend yields. Most of the high-yield stocks I discuss are in the energy space, which is an industry filled with companies that currently benefit from subdued CapEx growth and strong income tailwinds.

In other words, it makes sense for these stocks to have elevated yields.

In fact, it's the industry with the biggest difference between current CapEx (as a share of total S&P 500 CapEx) and 10-year average CapEx.

Another area with low CapEx requirements is real estate, which has - by far - the lowest CapEx requirements of the entire S&P 500....

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