This Stock Should Declare A Special Dividend Next Month...

Ultra-high yields and market-beating long-term performance?

Sounds too good to be true.

But, there’s one stock that’s delivering massive dividends and consistent share price growth. And it’s a company most investors have never heard of.

That business is Investors Title Company ($ITIC).

Consider the following…

If you’d bought Investors Title Company in January 2015, you would have:

• Paid $70 per share

• Received $90.91 per share in total dividends

• Gained +358.65% in capital appreciation — a 16.45% average annual return, excluding dividend reinvestment

With dividends reinvested, you would have achieved an 18.69% average annual total return, turning a $20,000 investment into more than $110,000.

So what does Investors Title Company do that makes it such a lucrative investment?

Well, the company sells title insurance. This is a boring business that operates in an essential niche. In the United States, virtually all mortgage lenders require a homebuyer to have title insurance when they purchase their property.

No title insurance, no house.

Investors Title Company provides that insurance.

This is the quintessential niche business. Easy to ignore, hard to get excited about, but consistently beating the market while also paying enormous special dividends.

Here’s how it works…

Investors Title Company pays a fixed quarterly dividend of $0.46/share.

This payout has remained unchanged since 2021. However, Investors Title Company also pays a special distribution every December. These dividends vary, but they often give the firm anywhere from a 3-12% starting yield.

For example, in 2023, housing sales slowed and Investors Title Company did less business than usual. As a result, the firm paid a fixed quarterly dividend of $0.46 per share and also issued a one-time special dividend of $4 per share. An investor who bought this stock at the start of 2023 would have paid somewhere around $160 per share. That investor would have ultimately received $5.84 in total dividends. Or, a starting yield of around 3.6%.

Since housing sales were slow, Investors Title Company was still trading around $160 per share at the start of 2024. An investor who bought in January of 2024 would have received four $0.46 dividend payments plus a $14 per share special distribution. This would have netted the new investor $15.84, or a 9% starting yield.

Investors Title Company typically declares their special payout in late November or early December. So if you are interested in this stock, it’s worth keeping an eye out for the upcoming announcement.

With a current price to earnings ratio of 14.45, Investors Title Company is cheaper than the general market. However, this is a stock that’s heavily dependent on home sales.

While I think Investors Title Company is a great business and could be a fantastic investment, it is worth noting that firm isn’t as straightforward as some insurance companies like Aflac or Old Republic International. Still, if you’re interested in niche businesses with potentially huge starting yields, Investors Title Company deserves a spot on your watchlist.

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Disclaimer: This article is for entertainment purposes only. It is not financial advice, always do your own research.