Dividend Dispatch — Header
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| Dividend Dispatch |
| Income is everywhere. I find it. |
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| MONDAY, JUNE 1, 2026·6 min read |
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Dividend Dispatch — Today's Theme
| Today's Theme |
| Four high yields cut in 2026 — but PHK pays its 12.5% today |
| I spent the weekend going through Q1 results for mortgage REITs, BDCs, and CLO equity funds — the corners of the income market that pay 10%+ yields. The divide is brutal. OBDC, FSK, and TSLX all cut in 2026. Arbor Realty cut 43% in May. Eagle Point Credit cut 57% in February. Meanwhile Friday's close put the S&P 500 at 7,580.06 — the 9th straight weekly gain, the longest streak since 2004. Dell jumped 30% Friday on Q1 earnings. April PCE printed 3.8% — the highest inflation reading since May 2023. The Fed's preferred gauge is going the wrong direction. Today's picks: PHK at 12.5%, paying its monthly today June 1 with 92% coverage; PennantPark at 14.9% with an honest look at the math; Colgate-Palmolive — a 63-year King with the kind of cash flow most of the cutters don't have; and Arbor Realty as a watchlist case after its own cut. |
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The SpaceX Story Everyone Missed |
Elon Musk just did something… and nobody noticed. |
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Everyone was looking the other way. |
And yet, I believe that anyone who understands what just went into orbit has a shot at turning $500 into a life-changing payout. |
Click here to see the SpaceX story that no one is talking about. |
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Dividend Dispatch — Main Post
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The High Yield
Today's best dividend income ideas — 8%+ yields only
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| PHKPIMCO High Income — pays today, 12.5% yield, covered at 92% |
Found this one re-screening high-yield CEFs on Saturday morning. PHK is a closed-end fund managed by PIMCO that holds a portfolio of U.S.-dollar denominated high-yield corporate bonds — also known as junk bonds, the kind issued by companies below investment-grade rating. The fund has been paying monthly distributions since 2003. Today is the next payment date — $0.0483 per share, the latest monthly check from a fund that pays you twelve times a year instead of four.
Annualized at $0.58 per share. Yield 12.5% on a $4.52 stock. $10,000 invested = $1,250 a year, paid in $104 monthly checks. AUM is $852 million. The fund trades at a 2.64% premium to its underlying net asset value (NAV) — closed-end funds can trade above or below the value of what they hold, and PHK's current premium is actually below its historical average. Distribution coverage is 92.3% of earnings — imperfect but functional, with the gap covered by reserves.
Risk to know: high-yield bonds are the riskiest end of the bond market. If credit spreads widen — meaning investors demand more compensation to hold risky debt — PHK's NAV falls and the share price typically follows. Friday's PCE inflation print at 3.8% — the highest since May 2023 — makes the Fed less likely to cut rates, which is mostly fine for PHK (it holds primarily fixed-rate bonds), but extends the timeline before refinancing pressures ease on issuers. |
| Yield: 12.5% |
$10K invested = $1,250/yr |
Paid: Monthly |
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| PFLTPennantPark Floating Rate — 14.9% monthly, but the coverage math needs honest framing |
This one needs the honest version. PennantPark Floating Rate Capital is a BDC — a business development company, which is a publicly-traded fund that lends money to mid-sized private companies. PFLT specifically holds floating-rate loans, meaning the interest income rises with short-term rates. The current monthly distribution is $0.1025, annualized $1.23. On a $8.24 stock that's a 14.9% yield. $10,000 = $1,490 a year, paid as monthly $124 checks.
PFLT has held that monthly distribution steady at $0.1025 for many years — including through cycles where most BDCs cut. Management calls it "your grandmother's BDC" — lower risk, lower expense, lower yield than peers, designed for stability. The company avoided the cuts that hit OBDC, FSK, and TSLX in 2025-2026.
The math you need to see: Q2 fiscal 2026 results showed PFLT will likely not fully cover the dividend from net investment income next quarter. The buffer that bridges the gap is undistributed/spillover income from prior years — about $0.22 per share of accumulated cushion. That's roughly two months of buffer at the current pace, not unlimited.
Risk to know: PFLT trades below book value, which historically has been a buy signal — but the discount reflects the market's concern about coverage. If credit conditions worsen further or short rates fall faster than expected, the spillover buffer doesn't last forever. I'm not buying more here. But the existing dividend is reasonably defended for the next few quarters. Eyes open. |
| Yield: 14.9% |
$10K invested = $1,490/yr |
Paid: Monthly |
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Safety & Watchlist
Reliable picks + red flags
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| Safe Pick |
| CLColgate-Palmolive — 63rd consecutive raise, paying continuously since 1895 |
The other end of the spectrum from this morning's High Yield picks. Colgate-Palmolive sells toothpaste, deodorant, dish soap, pet food (Hill's Science Diet), and the brand names you grew up with — Colgate, Palmolive, Speed Stick, Ajax. They sell in 200+ countries and territories. They have paid an uninterrupted dividend since 1895 — that's 131 years of continuous payments through every war, depression, and recession in modern American history.
On March 12, the board raised the quarterly dividend 1.9% to $0.53 per share from $0.52. That marks the 63rd consecutive annual increase. Effective with the Q2 payment that went out May 15 to holders of record April 20. Annual rate $2.12. Yield 2.37% on an $89 stock. $10,000 = $237 a year in income.
The 1.9% raise looks small — and last week I flagged Hormel's 1% raise as a distress signal. So why is Colgate's 1.9% different? The cash flow. Q1 2026 free cash flow was $609 million, up 27.94% year-over-year. The company paid $417 million in dividends in the same quarter. That's a cash payout ratio of 68% — well below distress territory. Sales grew 8.4% in Q1 2026. Adjusted EPS came in at $0.97, beating estimates for the fourth straight quarter. The modest raise reflects management's caution about tariff impacts (~$300 million expected hit from resins and petrochemicals) and a multi-year restructuring program — not a coverage problem.
Risk to know: the stock isn't cheap. Wall Street sees about 18% upside to the average analyst target, but no one is calling CL undervalued. Tariff-driven margin pressure is real this year. Emerging market currency volatility hits earnings translation. But the dividend looks among the safest you can buy. |
| Yield: 2.37% |
$10K invested = $237/yr |
Paid: Quarterly |
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| Watchlist |
| ABRArbor Realty cut 43% in May — and the new dividend still isn't covered |
Arbor Realty Trust is a commercial mortgage REIT that lends primarily to multifamily and commercial real estate operators. On their Q1 2026 earnings call this May, management reset the quarterly dividend from $0.30 to $0.17 per share — a 43% cut. Net income for Q1 came in at $0.6 million, or $0.00 per diluted share, down from $30.4 million a year earlier. Distributable earnings were $0.07 per share.
Here's the harder number, the one that puts ABR on watchlist instead of red flag. Management guided Q2 2026 distributable earnings to approximately $0.15 per share — still below the new $0.17 dividend even AFTER the 43% cut. The company has roughly $1 billion in non-performing assets, about 8% of the total portfolio. Management called Q2 and Q3 2026 "the low watermark" for earnings.
Yield at the cut level is around 12% on the $5.66 stock. Stock has dropped from $18 in 2021 to $5.66 today. Annual dividend $0.68. $10,000 = $1,200 a year in income today — if the dividend holds.
Why watchlist instead of red flag: management is actively cleaning up the balance sheet and the multifamily lending market is structurally large. If they hit guidance on $0.15 distributable in Q2 and get back to $0.20+ in Q3, the new dividend has a path. If Q2 comes in below $0.15, another cut is on the table. Read every quarterly report carefully and own nothing more than you can lose. |
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The Extra Yield
This week's calendars, screens & answers
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| Weekend headline I loved: Friday capped the S&P 500's 9th consecutive weekly gain — the longest streak since 2004. Dow up 363 points to a record 51,032.46. Dell up 30% on a single-day record. But here's the contrast that mattered to me: PCE inflation printed 3.8% for April, the highest since May 2023. Stocks at records. Inflation moving higher. The Fed in a difficult spot. The dividend ideas I'm interested in are the ones that don't depend on rate cuts to keep their math working. |
| Saturday screen results: 2026 dividend cuts among publicly-traded high yielders I track. FSK: cut 21% in late 2025. ECC (Eagle Point Credit): cut 57% in February. GBDC: cut in February. OBDC (Blue Owl): cut 16% in March. TSLX: cut from $0.46 to $0.42 in May (Watchlist May 25). ABR (Arbor Realty): cut 43% in May (today's Watchlist). That's six dividend cuts in five months across BDCs, mREITs, and CLO equity funds. The high-yield income space is going through a credit cycle. PHK survived because it's a different vehicle (junk bonds, not direct lending). PFLT survived through accumulated spillover income. Coverage. Every. Single. Time. |
| Someone asked me over the weekend: "If yields are this high in BDCs and mREITs, why don't I just buy a dozen of them and diversify away the cut risk?" Honest answer — that doesn't work the way you'd think. The cuts are correlated. When credit spreads widen and short rates move, they affect the whole space at once. Diversifying across 12 BDCs in 2026 means you participate in most of the cuts, not avoid them. The better defense is picking 2-3 names where the math actually works at the name level — coverage above 100%, modest borrowing relative to equity, manageable non-accruals. The dividend doesn't care how diversified your portfolio is. It either comes or it doesn't, name by name. |
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| The Dispatch |
| Four names this morning. PHK at 12.5% monthly with 92% coverage, paying today. PFLT at 14.9% monthly with the spillover-income honesty. Colgate-Palmolive on its 63rd raise, paying since 1895, with the cash flow to back it. Arbor Realty on the watchlist — cut once already this quarter, and the math suggests another quarter of watching before deciding. I spent the long weekend in spreadsheets so you don't have to. Tomorrow brings Aristocrats and Growth Stars — and one Aristocrat in particular has been on my list for weeks. See you in the morning. |
| — Charlie |
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Dividend Dispatch — Footer
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