Denbury Is a Play for Contrarians

The oil and gas producer Denbury Resources (DNR) has seen its shares sink since mid-month after its board of directors decided against converting to a master limited partnership (MLP) structure. A conversion would have cut down on corporate taxes while guaranteeing a relatively high distribution rate. Management did not see the resulting legal expenses and other considerations as justifying the change.

Management did indicate that it will start paying cash dividends of $0.25 a share annually in 2014. It also voiced its intention to bring that rate to $0.50-$0.60 per share by 2015. That should make the shares more attractive to mutual funds and individuals who invest only in dividend-paying stocks....308 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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