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Legal Counsel Dear Mr. Berko: After three years, we had to dismiss our legal counsel, though we parted on excellent terms. I know you are familiar with our case because that firm unsuccessfully offered you a retainer and ongoing fee to advise it. We have narrowed …Read more. Annuity vs. Stock Dear Mr. Berko: I have a large certificate of deposit coming due next month, which I could renew at less than 1 percent. When I told the banker that I'd like a higher rate of return, I was introduced to a specialist who aggressively tried to sell an …Read more. Merck and Zogenix Dear Mr. Berko: My broker wants me to sell my 600 shares of Merck because he believes that the company will be sued by people who have consumed beef cattle that were fed with Merck's Zilmax. The literature says this drug produces bad side effects on …Read more. Taxes and the Internet Dear Mr. Berko: I have a carefully selected growth portfolio, about 16 percent of which is invested in Internet-related and broadband issues. Please tell me what effect this new tax on Internet and broadband usage will have on their values. I'm …Read more.
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High-Dividend-Paying Stocks

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Dear Mr. Berko: I want to take a modest gamble with about $21,000 and would like to buy some high-dividend-paying stocks that you think have a chance of maintaining or increasing their dividends as well as the value of the stock price. A broker who was recommended to me said that my idea of buying high-dividend stocks was suicide. He said that the dividends are high because the company is on its last legs and could easily collapse in price or even go out of business. He suggested that I invest in penny stocks that sell for under a dollar a share. He said I could buy 25,000 shares like CCTC at 12 cents a share for $3,000, and if the stock moves up 10 cents in a week or two weeks, I would clear $2,500 and almost double my money. He showed me many stocks that he bought for clients that have increased tenfold in value. Please advise me. — D.R., Mount Clemens, Mich.

Dear D.R.: Of course you know that the reason penny stocks sell for pennies is because pennies are what they are worth. I think that broker ought to petition the court to have himself legally declared as a cockroach. This cur is dangerous to your wealth. Penny stocks are for penny brains whose total sum of knowledge and expertise is worth a cooper.

Many folks claim they've made big scores in the penny stock market, and many have. However, those penny brains never tell you of the numerous huge losses they absorbed in order to earn bragging rights for just one score. And it's been my experience that penny-stock buyers enormously inflate the profits they brag about.

Meanwhile, the following three high-yielding stocks have a better-than-even chance of maintaining their high dividends, growing their businesses and improving their stock values.

Cellcom Israel (CEL — $33.05) is one of three cell phone companies in Israel, but seems to have technical superiority over the other two.

CEL's system does everything BlackBerry, blueberry and the iPhone and iPod do, including push to talk, Internet connectivity, SMS and MMS services, animation messages and interactive protocols. CEL had $1.7 billion 2009 revenues, and with net profit margins of 17.6 percent, the company earned $3.12 per share. The $2.72 dividend yields 8.0 percent.

Winstream Communications (WIN — $10.41) is a specialty phone company that provides landline, Internet, long distance, network access and video service to 3.2 million customers in the very rural areas across 16 American states. This $3.1 billion revenue company has a 13 percent net profit margin, and its $1.00 dividend yields 9.6 percent.

Finally, Century Telephone (CTL-$34.76), with $7.1 billion in revenues, trades at just a buck above its $32 book value. CTL, which acquired Pacific Telecom (an AT&T spinoff) in 1997, is the fourth-largest phone company in the U.S. It boasts a blue chip balance sheet and sound finances. CTL has 10 years of consecutive earnings growth, and its 15 percent net profit margins allow it to pay a $2.90 dividend that yields 8.65 percent.

Put these three in your Meerschaum and enjoy an 8.5 percent or better average annual dividend return on your investment. Then sit back, smoke your pipe and wait for CEL, WIN and CTL to eventually rise in value.

Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, FL 33775 or e-mail him at mjberko@yahoo.com. To find out more about Malcolm Berko and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

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