Sunday, October 10, 2010

Spotlight on a 7.7% Yield Stock

If you think the economy is turning around, with manufacturing and construction picking up, you may think that iron ore is a way to play the recovery. One way of investing in iron ore is through a mining royalty trust such as Mesabi Trust (MSB). Mesabi owns an income stream from an iron mine located near Babbitt, Minnesota. Because the company is structured as a trust, all income is passed through to the investor, bypassing corporate income taxes.

Based on the latest quarterly payment of 80 cents per share, this New York Stock Exchange traded stock yields about 7.7%, and trades at 14 times forward earnings.

Investors seem to be catching on to this high yield investment as the stock is up around 50% over the last month. Maybe it is because earnings for the latest reported quarter were up 4,881% year over year on a revenue increase of 2,556%. The company is debt free with $11 million in cash in the bank.

If you like high dividend stocks such as this, check out the high yield stock lists at

Disclosure: Author does not own the above at the time the article was written.


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