The majority of income investors missed the opportunity.
They had until the close of trading on June 27 to claim their $977 “Liberty Check.” June 27 came and went with little fanfare for the majority of income investors.
That’s too bad. A minority claimed a “liberty check” worth up to $977 on June 27. They received their “liberty check” on July 10.
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This particular “liberty check” was paid by a Bermuda-based holding company. The company’s headquarters is in Singapore. Bermuda and Singapore are tax-friendly to corporations.
The tax regime matters. It’s easy to understand why it matter: Less money paid to government, more money paid to investors as “liberty checks.”
This company’s international footprint extends beyond Bermuda and Singapore. Its shares are listed on the New York Stock Exchange. Twenty-six percent of its shares are owned by U.S.-based institutional investors.
The international footprint extends further still. Though the company has a presence in Bermuda, Singapore, and the United States, the actual business originates in China.
This company is one of the largest engine manufacturers in the People’s Republic. It manufactures, assembles, and sells a variety of light-, medium-, and heavy-duty engines. Engine sizes range from 1.2 liters to 105.6 liters. These engines are used to power trucks, buses, passenger vehicles, and construction equipment.
Through its regional sales offices and authorized customer service centers, this company distributes the engines to original equipment manufacturers and retailers. It also provides maintenance and retrofitting services throughout China.
Business is good, which is why this company was able to pay such munificent “liberty checks” to its shareholders.
Annual revenue, at $2.46 billion, was up 23% last year. Earnings per share (EPS) growth was more impressive. EPS posted at $3.55, a 91% year-over-year increase.
Growth has persisted into 2018. First-quarter revenue was up 4.1% year over year.
EPS was up 8.4%.
The business continually generates a lot of free cash flow – $278 million last year. The cash account is continually replenished.
The cash account held $767 million in cash and cash equivalents at the end of the first quarter. The “liberty checks” paid to shareholders consumed only $91 million of cash. The cash account will remain sufficiently stocked.
The “liberty checks” paid to shareholder made good use of company resources. They reduced the cash account, which held too much cash. Removing excess cash ensures higher returns on invested capital.
Then, of course, there is the obvious: The “liberty checks” rewarded shareholders with immediate income.
The “liberty checks” were also a positive signal to shareholders. The “liberty checks” foreshadowed better days ahead. Growth will persist into 2019.
China’s economy continues to grow at a rate double that of the United States. The International Monetary Fund (IMF) forecasts China’s economy to grow by 6.6% this year. It grew at a 6.8% annualized rate in the first quarter.
This company will find additional growth avenues developing new hybrid engines. Demand is certain to rise for hybrids to meet China’s increasingly stringent emissions standards.
The “liberty checks” have come and gone, but this company’s shares are still worth owning. When it’s not paying “liberty checks” to shareholders, it’s paying high-yield dividends to them.
Besides, I see more than a one-and-done proposition. I expect this company to supplement its current high-yield dividend with additional “liberty checks” in the future.
More “liberty checks” are on offer. I can show you how to collect “liberty checks” similar to the one paid by this particular Bermuda-Singapore-U.S.-China engine manufacturer.
I can even show you how to do better – much better.
I can show you how to collect “liberty checks” that are 10X the average dividend check. I can also show you how to trade the shares of “liberty check” issuers for triple-digit annualized return.
I am co-hosting a free, live “liberty check” webinar this Tuesday (July 24) at 12 p.m. EDT (noon). You’re invited.
But don’t delay. Space is limited and it fills quickly. Click here to reserve your spot for this free, live event.
You have nothing to lose except the opportunity to collect 10X more income by collecting “liberty checks.”