The Geo Group, Inc. (GEO), F5 Networks, Inc. (FFIV), Delta Air Lines, Inc. (DAL): One Great Dividend You Can Buy Right Now

Show me the money, GEO Group

In addition to growing its top and bottom line, The Geo Group, Inc. (NYSE:GEO) followed in the footsteps of the larger CCA by completing its conversion to a real estate investment trust earlier this year. The advantage of a corporation in becoming a REIT is considerably lower taxation while shareholders benefit, because a REIT is required to pay out 90% or more of its income in the form of a dividend. The end result for shareholders has been a big bump in GEO’s payout:

Source: Nasdaq.com.

*Assumes mid-point of $0.53-$0.55 dividend guidance issued by GEO Group in the most recent quarterly report.

Although this is just six quarters of payment history, we’ve seen GEO’s dividend jump from just $0.20 to an expectation in the upcoming quarter that GEO will pay out 75% of its funds from operations, or $0.53-$0.55 per share, as a dividend. GEO is currently yielding 6.1% annually based on a payout of $0.50 per quarter and could see its projected yield jump to 6.8% if it paid out $0.54 (the midpoint of its fourth-quarter payout guidance) for the next four quarters.

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It’s understandable that GEO Group may not be a choice for socially responsible investors, but it nonetheless represents a basic necessity of life and, as such, will deliver relatively stable cash flow. With geographic advantages over CCA and its conversion to a REIT now complete, GEO Group looks poised to deliver a 5% or greater yield to investors for years to come.

The article 1 Great Dividend You Can Buy Right Now originally appeared on Fool.com and is written by Sean Williams.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.The Motley Fool owns shares of, and recommends, F5 Networks.

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