Wall Street only toasted our Navy SEALs daringly brilliant operation that took
out Osama Bin Laden for about one hour Monday morning. Then it was back to the
usual humdrum concerns inflation , interest rates, corporate earnings. By
Tuesdays close, stocks (as measured by the S&P 500 index) had slipped for a
second session, with the most significant losses concentrated among the red-hot
energy and raw materials issues that had led the markets surge in recent weeks.
But wait a minute. What did I just say? If, in fact, its the hard assets that
are now dragging the indexes lower, the market really is celebrating Bin Ladens
demise. One of the prime factors driving speculators into oil, precious metals
and even grains lately has been fear of an uncontrollable blow-up in the Middle
East. Rubbing out Al Qaedas kingpin certainly wont, by itself, bring peace and
order to that troubled area of the world. However, Americas success in
Abbottabad has made an impression on our adversaries. Their noise level has
dropped a notch. And thats what the market seems to be taking note of. Theres a
corollary to this observation. So far, most stocks (outside of energy and raw
materials) are weathering the two-day pullback in fine fettle. Implication: Were
still in a rotational market, in which various stock groups come into and go
out of favor without disturbing the overall uptrend. Accordingly, your strategy
should be to continue accumulating stocks that promise the holy grail of low
risk and above-average projected returns. Whenever the market indexes dip, were
likely to spot a few more of these gems. One such stock is Israeli wireless
carrier Partner Communications (NASDAQ: PTNR ). The company is a neck-and-neck
with rival Cellcom Israel (NYSE: CEL ). Like CEL, which Ive recommended before ,
PTNR maintains an unusual policy of paying out the vast majority (currently more
than 80%) of its profits in the form of dividends. I still like CEL as much as
ever; however, PTNR now appears to offer a slight edge. In February, Israel
promulgated new regulations that cut the maximum fees wireless carriers can
charge when a subscriber switches providers. The new rules have set off a
competitive free-for-all, which should benefit PTNR more than CEL because
Partner has more room to cut operating costs. Yet PTNR shares have lagged a bit
behind CEL over the past three months an anomaly. Result: PTNR now boasts a
higher yield on my latest estimate of 2011 dividends (as well as a lower forward
P/E). Im looking for $2.10 of both earnings and dividends for the year. At
todays closing price of $18.87, youre pulling down a projected yield of 11.1%!
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