By Kathleen Martin
Jim Cramer issued his recent buys for his Charitable Trust portfolio. His actions on the buy side of this portfolio are defensive, as he appears to purchase for dividend yield and safety as opposed to share price appreciation in most cases. His trades are for a maximum of 1,500 shares, which does not upset any market momentum either on the buy or sell side. This amount also allows for fills to be executed at pre-determined prices in their entirety.
Weyerhaeuser Co. (WY)
WY is a forestry, forest products and home building company. The stock price is around $17. The year high is $25.33, the year low $14.82 The company posted net income of $157 million in the third quarter, or $0.29 cents a share, compared with $1.12 billion, or $3.50 a share, a year ago. Sales rose 3.6 percent to $1.56 billion in the same period.
WY announced its intention to convert the common stock into a REIT in order to decrease its tax liabilities and increase its competitiveness in the forestry business. While WY has taken the steps to convert, is included in the REIT Index, as well as issuing dividend guidelines in 2011 as a REIT, there is no guarantee that the IRS will accept it. Even if commodity prices rise, high raw material costs such as wood chips and chemicals could diminish any upside. The Company itself is cautious about the U.S. housing market and the diminishing growth in China. While the dividend distribution is beneficial, it doesn’t outweigh the commodity/currency/economic risks. Reasons to buy this stock remain puzzling.
Unilever NV (UL)
Unilever provides fast-moving consumer goods in Asia, Africa, Europe, and Latin America. The Company’s reputation for strong growth even during economic slowdowns, good corporate governance and stewardship and a well reasoned and effective product acquisition program make this stock a good bet.
Dividend yield investors have a reason to buy this stock. The dividend yield is 3.54%. The stock has paid steady dividends since 2000 and the share price has a moderate trading range. The stock trades at around $34. The year high is $35.17, the year low $28.89.
International Business Machines Corp. (IBM)
IBM stock trades around $194. The year high is $194.90 the year low $144.15. Earnings per share for the last year were $12.64. Dividend yield is 1.57%.
Its ability to attract industry leading personnel and its intellectual property keep it number two next to Apple, Inc. (AAPL). IBM stands out in the industry with its long-term presence, ability adapt to technology changes. Warren Buffett purchased $10.7 billion worth of stock in November 2011, which may be a positive harbinger of things to come, keeping in mind Mr. Buffett is a long-term value investor.
Freeport McMoran (FCX)
FCX is world’s largest publicly traded copper company and has interests in other industrial and precious metals. FCX trades around $39.50. The year high is $61.35, the low $28.85.
The Company has diversified mining operations around the globe. The industrial metals provide good growth potential while the gold and silver provide an inflation hedge. The Company has announced a plan to buy back all of its 8.25% notes due in 2015 at a premium of $104.125. This removes significant debt from the balance sheet and saves interest costs of around $90 million per year. The only negative Company news was that the Company experienced a decrease in production from Indonesia’s (pdf) labour strike.
FCX’s debt reduction, global diversification and vast metals and minerals reserves make this a good buy in the resource sector.
AT&T, Inc. (T)
ATT price is approximately $29. The year high is $31.94, the year low $27.20. It has reported earnings of $1.97 per share in the third quarter of 2011 and has a healthy dividend yield of 5.10%.
According to Dividend Kings, AT&T is one of the "dividend kings of 2012." It is the largest telecommunications company in the United States and has the nation’s fastest network. It continues to benefit from its deals with Apple for the iPhone 4 to increase activations on its network. ATT’s recent attempt to merge with T-Mobile may be the only reason to have caution in assessing the stock’s performance.
Its size and strength in the wireless space and dividend yield make this stock an attractive buy at this price.
Broadcom Corporation (BRCM)
BRCM business is chips, semi-conductors and wireless communications. The stock price is around $30.29. The year is high $47.39, the low $29.02. The Company posted earnings of $1.66 per share and has an annual dividend yield of 1.20%.
BRCM’s chips are built into high volume consumer products, and it has an 80% market share in the Wi-Fi, smartphones and HD set-top boxes. BRCM has a strong foothold and continues to innovate to provide chips that allow efficient and seamless connectivity and high definition/rich content viewing.
Broadcom’s low stock price and market share make this an attractive buy for investors looking for near-term price appreciation.