Oil surged past $79/barrel on Monday. The Iran-US-Strait of Hormuz narrative seems to be holding water.

You’ve heard about the big oil and defense stocks. You’ve probably also seen some of the volatility that they’re facing.

Today, we’re looking at a different approach; one that could capture the upside of the oil industry but also provide consistent income through dividends.

More below, but first, a North American rare metals company building out a western defense supply chain:

This is not financial advice. Always do your own research. Past performance doesn’t guarantee future results.

In partnership with Think Ink

Last century, wars were fought over oil.

The 21st century will be won or lost on rare earth elements.

And in today's warfront, the dependency is existential.

The bottleneck isn't the minerals themselves. As President Trump put it, "There's no such thing as rare earths. There's rare processing."

Nearly all global refining equipment is built, coded, and controlled overseas - a dangerous chokepoint that could be cut at any time.

REalloys (NASDAQ: ALOY) is working to bring that leverage back to North America.

While giants like MP Materials focus on high-volume light elements, REalloys is targeting the heavy rare earth market critical to advanced defense and aerospace.

See how REalloys (NASDAQ: ALOY) is building an "uncuttable" sovereign supply chain.

Tomorrow Investor

We’ve seen and heard of all the big defense and oil stocks in the midst of the war between the US and Iran right now. But it seems like most of them are focused on growth in a volatile environment. Which is great… but sometimes, we’re more interested in defensive investments with an income angle (it’s in the newsletter’s name, after all!).

We mean dividends. And while Raytheon, Exxon, and Lockheed Martin all have dividends, their yields are below 3% and they have $150-650 billion market caps. Can we find anything with a smaller market cap, a bigger dividend, and room to grow?

Well, we think we found something interesting.

You might be tired of hearing about oil stocks and oil prices by now. Two things: 1) there will be a lot more news about oil in the near future with US-Iran developments, and 2) this one is different! “That’s what they all say,” you may be thinking. While that may be true, Petrobras (PBR) one’s different because we’re focusing on the dividend and because it sells Brent crude oil, which is likely to be in much higher demand because the Strait of Hormuz is shut down.

Petrobras’s dividend yield is determined by two (more) things: 1) its free cash flow and 2) its gross debt. If Brent crude oil stays above $80, PBR might be looking at a whole lot more cash coming in, which could mean a higher dividend yield.

A caveat would be that Petrobras is a national Brazilian company, so if Brent crude prices get higher and stay higher, the government might order the company to subsidize some of the cost of oil; this would eat PBR’s cash, which would in turn eat the company’s dividend payouts. Also, the company has a high-CapEx (capital expenditure) growth plan for the next five years ($109B through 2030), which might also leave less cash on the table for dividends.

See AltIndex’s Top 10 Dividend Stocks →

This is not investing advice. Always do your own research.

Oil surged past $79/barrel on Monday after US-Israel strikes on Iran over the weekend sent shockwaves through energy markets. Brent crude jumped 8%, WTI climbed 7%, and gas prices crossed the $3 per gallon mark nationally. Analysts warn prices could spike another $0.10 to $0.30 this week as the conflict disrupts shipping through the Strait of Hormuz, which handles 20% of global oil flows.

Paramount will merge HBO Max and Paramount+ into one streaming service after closing its $110 billion acquisition of Warner Bros. Discovery. The combined platform would boast 200 million subscribers and unite franchises like Game of Thrones, Mission Impossible, and the DC Universe. CEO David Ellison promised to keep HBO's brand intact. The merged entity will carry $79 billion in net debt.

JPMorgan's Jamie Dimon warned that higher inflation could be the "skunk at a party" for the US economy, cautioning investors not to get too comfortable with current conditions.

Eli Lilly is on track to launch its oral obesity drug orforglipron in Q2, pending FDA approval expected in April. The company has $1.5 billion in pre-launch inventory ready to ship within a week of the green light. It'll face competition from Novo Nordisk's Wegovy pill, which hit US shelves in January.

Bitcoin bounced back above $69,000 after a volatile weekend that saw the token dip to $63,255 following the Iran strikes. Analysts pointed to crypto's "resilience" and revived the "digital gold" narrative, though the token remains down 20% year-to-date from its October high of $126,000.

Nearly 70% of Gen Z shoppers would consider buying a Chinese car, according to a new Cox Automotive study. BYD, Geely, and Xiaomi remain largely unknown to US consumers, but younger buyers are drawn to their lower prices. When Chinese brands partner with US automakers, consideration jumps to 76%.

PayPay, the SoftBank-backed Japanese payments app, is aiming to raise roughly $1.1 billion in a US IPO.

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Cheers,
Brandon & Blake of Invested Inc