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Top Five Stocks for Under $10 with Hefty Yields

A solid dividend yield is often territory for the big-time institutional investor. Smaller retail investors can't be expected to afford the massive share prices for the best yields on the market,

A solid dividend yield is often territory for the big-time institutional investor. Smaller retail investors can’t be expected to afford the massive share prices for the best yields on the market, right? Well, dividend fans rejoice! Here are five stocks that have dividend yields of more than 10 percent while still maintaining a share price under $10.

1. Alaska Communications Systems Group (ALSK)

Telecom has long been a sector known for its solid dividends, and no company offers a better yield than Alaska Communications. Alaska Communications has a share price of under $5 ($4.91 as of market close Friday) and still offers a dividend yield of 17.52 percent. The Anchorage, AK-based company provides telecom services for Alaska, offering the first state-wide third generation wireless network and it’s the only company in the state with fully incorporated wireless communications, Internet networking, and local and long distance phone service platforms. ALSK had a rough year, losing over 55 percent of its share price since January, and a November sell-off followed comments from the company implying that it would be reconsidering its dividend.

2. Niska Gas Storage Partners LLC (NKA)

Niska Gas Storage is an independent owner and operator of natural gas storage assets in North America. With 204.5 billion cubic feet of total gas storage capacity, this Houston, TX-based company is the largest independent owner and operator of gas storage facilities in North America. Niska owns properties in Alberta, California, and Oklahoma. Niska is also in the midst of a rough year, losing over 50 percent of its share value in 2011. However, with a share price of $9.49 at market close Friday and a dividend yield of 14.75 percent, Niska could be a cheaper option to get access to a solid yield.

3. Frontier Communications Corp (FTR)

Returning to the telecom sector, Frontier Communications provides services predominantly to rural areas and small and medium-sized towns and cities. Frontier emerged when Citizen Communications purchased the former Frontier Corporation from Bermuda-based Global Crossing in 2001. Despite costing only $5.16 per share as of market close Friday, shareholders for Frontier collect a dividend of 14.53 percent. It has offered the dividend since September of 2008 and the fact that the stock has lost almost 50 percent since the start of the year means that it could be a good time to get in.

4. Life Partners Holdings, Inc. (LPHI)

With a market cap of only $125 million, Life Partners is the smallest company on this list. A financial services company specializing in the secondary market for life insurance known as life settlements, it facilitates the sale of life insurance policies before the policy matures for investment purposes. Life Partners has had an up and down year. Shares plunged over 80 percent from a 52-week high in January, bottomed out in early summer, but have doubled in value in the last six months. Now, selling at $6.73 at market close Friday, Life Partners offers a 11.89 percent dividend.

 5. Ship Finance International Limited (SFL)

It’s hard to imagine anything positive in the business world coming out of Greece these days, and Ship Finance International Limited has had a year that might support that belief. Down close to 60 percent, the Greek owner and operator of ships and other offshore assets has had a 2011 to forget. However, Ship Finance has some data that could still indicate that it’s a stock to consider. The share price is low, it has a PEG of only 0.13, it’s projected to have EPS growth of close to 50 percent over the next five years, and the company offers a dividend of 12.32 percent, making it possible that the depressed share price could be a buying opportunity for someone interested in a long term investment.

Editor’s Note: An earlier version of this article incorrectly listed The McClatchy Company (MNI) among this group.

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