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TM Editor's Note: This article discusses one or more penny stocks and/or microcaps. Such stocks are easily manipulated; do your own careful due diligence.

Founded in 2012 and  headquartered in Houston, TX, Stellus Capital Investment Corporation has the ticker symbol SCM

It is a business development company specializing in investments in private middle-market companies.

It invests through first lien, second lien, unitranche, and mezzanine debt financing, often with a corresponding equity investment.

The fund prefers to invest in the US and Canada.

Three key data points gauge SCM or any dividend-paying entity, namely:

(1) Price

(2) Dividends

(3) Returns

Those keys also show if any company has made, is making, and will make money.

SCM Price

Stellus Capital’s share price increased about 2% in the past year from $13.87 to $14.21 as of Wednesday’s closing price.

SCM Dividends

Stellus Capital has paid regular monthly dividends since December 2012. The current forward-looking annual dividend of $1.60 yields 11.26% per Wednesday’s $14.21 closing price.

SCM Returns

Putting it all together, a $2.79 estimated gross gain per share shows up when adding Stellus Capital's annual $1.60 dividend to an estimated $1.19 annual price gain.  That five-year average annual price gain, plus the dividend, makes that $2.79 gross gain.

A little under $1000 invested at the recent $14.21 share price would buy 70 shares, which multiply the $2.79 gross gain estimate up to $196.31.

Furthermore, nearly 57.5% of that $196.00 gain comes from the $112.60 in annual dividends generated from your $1,000 investment, and the $112.60 annual dividend amounts to almost 8 times the recent $14.21 single-share price.

(A dividend dogcatcher rule is to only buy a stock that pays an annual dividend from $1000 invested that is greater than the cost of a single share.)

Therefore, you may choose to pounce on Stellus Capital Management and its 11.26% dividend yield along with its 13-year dividend record.

The exact track of SCM's future share prices and dividends will entirely be determined by market action and company finances.   

Remember, the best way to track stock performance and dividend payments is through direct ownership of company shares.

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