Two high-yield buys for income seekers

Article Excerpt

BELL ALIANT INC. $26.70 (Toronto symbol BA: Shares outstanding: 127.4 million; Market cap: $3.4 billion; TSINetwork Rating: Above Average; Yield: 10.9%; www.aliant.ca) is the new name of Bell Aliant Regional Income Fund after its conversion to a dividend-paying corporation on January 1, 2011. Bell Aliant has over 3.1 million telephone customers in Atlantic Canada and rural parts of Ontario and Quebec. BCE owns 44.1% of Bell Aliant. The conversion forces Bell Aliant to pay income taxes. In response, the company will change the rate and frequency of its payout. Starting in March 2011, it will switch to quarterly dividends of $0.475 a share. The new annual rate of $1.90 (down from $2.90) will yield 7.1%, based on today’s price. That’s still a high payout compared to similar telephone utilities. As well, investors who hold Bell Aliant outside an RRSP will benefit from the dividend tax credit. In the three months ended September 30, 2010, Bell Aliant’s earnings per share fell 23.0%, to $0.47 from…

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