66 Years Old With $1.3 Million. Here Are 3 Hidden Gems to Buy
The post 66 Years Old With $1.3 Million. Here Are 3 Hidden Gems to Buy appeared first on 24/7 Wall St..
- Nexstar (NXST) yields 4.54% with $743M in FY2025 free cash flow covering its $169M dividend 4.4x, masking dividend safety behind a high earnings payout ratio inflated by.
- Amdocs (DOX) trades at 10x P/E with 4.4% yield and $645.1M in free cash flow covering its dividend 2.87x despite a 42.69% one-year drawdown driven by telecom-software stigma. Banc.
- Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Amdocs didn't make the cut. Grab the names FREE today.
A 66-year-old with $1.3 million can’t afford a dividend cut. The hunt for yield often pushes retirees into mega-caps, but I think the real income value sits in mid-caps whose GAAP earnings are masked by non-cash charges or sector stigma. Here’s my dividend safety read on three overlooked names.
Nexstar: Cash Flow Hides Behind a Scary Payout Ratio
Nexstar Media Group (NASDAQ:NXST) yields 4.54% on a $7.44 annual payout. The trailing earnings payout looks ugly because EPS of $4.73 trails the dividend, but that’s a D&A illusion.
| Metric | Value | Read |
|---|---|---|
| FY2025 FCF | $743M | Strong |
| FY2025 Dividends Paid | $169M | Well covered |
| OCF Coverage | 5.3x | Strong |
| Dividend Streak | 13+ years | Reliable |
The catch: post-TEGNA debt nearly doubled to $12.2B. CEO Perry Sook called the deal “a critical step in solidifying our future.” With 2026 EBITDA guided to $1.95B-$2.05B, I rate the dividend Safe.
Amdocs: A 10x P/E Masks Fortress Cash Flow
Amdocs (NASDAQ:DOX) trades at a 10x P/E with a 4.4% yield after a brutal 42.69% one-year drawdown. The telecom-software stigma is weighing on sentiment while cash generation remains intact.
| Metric | Value | Read |
|---|---|---|
| FY2025 FCF | $645.1M | Strong |
| FCF Payout Ratio | 34.8% | Healthy |
| Earnings Payout | ~42% | Healthy |
| Recent Raise | $0.527 to $0.569 | 14th straight |
New CEO Shimie Hortig said the company is “on track to achieve our fiscal 2026 financial guidance.” With FCF covering the dividend 2.87x, I rate it Very Safe.
Banc of California: A 20% Raise Signals Confidence
Banc of California (NYSE:BANC) yields 2.08%, modest on the surface, but the dividend just jumped from $0.10 to $0.12 quarterly, a 20% raise.
| Metric | Value | Read |
|---|---|---|
| 2025 OCF | $255.6M | Recovered |
| OCF Coverage | 2.46x | Adequate |
| Earnings Payout | ~32% | Conservative |
| Price/Book | 1.03x | Cheap |
CEO Jared Wolff said the bank is “well positioned to continue building on this momentum.” I rate this dividend Safe, with the caveat that regional bank cycles bear watching.
My Verdict for a Retiree
I’d be comfortable owning all three for income if the goal is sustainable cash yield from misunderstood cash machines. I’d be cautious if leverage at Nexstar rises further or if credit conditions sour for Banc of California. Amdocs is the cleanest of the three.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Amdocs didn’t make the cut. Grab the names FREE today.
The post 66 Years Old With $1.3 Million. Here Are 3 Hidden Gems to Buy appeared first on 24/7 Wall St..
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