Dividend stocks have been gaining popularity, especially after major technology companies started offering dividends for the first time this year. With inflation concerns and expectations of a prolonged period of higher prices, Americans are turning to dividend-paying stocks. In this environment, affordable stocks that offer high dividends are drawing attention.
One such company that has caught the eye of hedge funds is Chimera Investment Corporation (NYSE:CIM), a prominent player in the REIT industry. With 18 hedge fund investors, Chimera Investment Corporation currently boasts a dividend yield of around 10% as of May 14. The company made headlines recently when its board of directors announced a reverse stock split at a ratio of 1-for-3, effective May 21.
During its latest earnings call, Chimera discussed its dividend and financial situation. The company reported an economic return on GAAP book value of 7% for the first quarter, with net income of $31 million or $0.12 per share. Chimera also provided details on its interest income, cost of funds, leverage, financing, and hedging strategies.
Wall Street analysts have set a 12-month price estimate of $5.25 for Chimera, while the stock was trading at around $4.48 on May 14. This suggests an upside potential of 17%. However, unlike larger companies like Johnson & Johnson, Procter & Gamble, and Exxon Mobil, Chimera Investment Corporation is a smaller company with lower hedge fund sentiment.
While Chimera Investment Corporation may seem like a strong high-dividend penny stock, Insider Monkey’s research indicates that there are 10 other high-dividend penny stocks that may be better investments. It’s important to conduct thorough research and consider all options before making investment decisions.