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Craig Lehman  

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  • Consider Canadian Banks For Your Dividend Growth Portfolio, Like Bank Of Nova Scotia [View article]

    Please indicate where I was saying that S&P's views should be "blindly accepted" or "taken on faith"!!! Also, please note that S&P did *not* "downgrade" the Canadian bank stocks; it placed them on negative watch, which is not the same thing.

    I'll grant you the opinion you've developed of S&P over the long run, but still, what I would like to hear is a *specific reason* why you, or anyone, disagrees with their negative assessment of the "bail in" provisions. Just calling it a "knee jerk reaction" doesn't explain what is wrong with it. They took several pages to explain their view (admittedly with less than total clarity), but I think the particulars of their view deserve consideration. Then, if found wanting, their argument can be rejected. But I will not reject their view "on faith," any more than I take it "on faith."

    I think we are actually in agreement that S&P's view is "food for thought." But I am going to chew my food a bit before I decide whether to spit it out. Each dish has to be evaluated on its own merits.
    Dec 4, 2014. 02:33 PM | Likes Like |Link to Comment
  • Consider Canadian Banks For Your Dividend Growth Portfolio, Like Bank Of Nova Scotia [View article]
    TR, thank you. From what I have read, Canadian banks are the strongest in the world, and I was looking at BNS only because I was very satisfied with the performance I have gotten from RY and TD.

    It just struck me as very strange that the mention of S & P would draw the accusation of taking something "on faith." Even if they are not the de facto standard in risk assessment, I think their current negative watch is *evidence*, a sign of something that anything a stockholder doing due diligence ought to look into. I'm not saying that S&P is right or wrong, just that what they say *bears looking into*, somewhat like divergent testimony at a jury trial. You wouldn't disagree with that, would you? The Great Recession involved many stories of bank stocks that skeptics were sounding the alarm on before they went wobbly. I'm not going to dismiss a report from a respectable source out of hand.

    That said, the research report I cited in my original comment is not a model of clarity, and I am still rereading it and looking for further commentary before reaching a conclusion.
    Dec 4, 2014. 02:15 PM | Likes Like |Link to Comment
  • Seadrill And The Ghost Of Frontline [View article]
    Mayhawk, I agree about rigid rules. I have a couple SA articles to that effect. It's just that the stocks I've gotten burned on the worst also happen to be the ones that violated the BBB+ or better rule. I have little doubt that there is a BBB or worse stock out there that is a great investment. ("Many", I'm not so sure.) Realistically, though, with an appx 50-stock portfolio, I'm not going to do the extra due diligence which I think such stocks (like SDRL) require until I have about 45 slots in my portfolio filled with investment-grade companies. And for widows and orphans who need to be able to count on every dividend dollar, it's not a course I'd recommend.
    Dec 4, 2014. 01:55 PM | Likes Like |Link to Comment
  • Consider Canadian Banks For Your Dividend Growth Portfolio, Like Bank Of Nova Scotia [View article]
    Oh, I try not to put blind faith into anyone, including S&P. And I *am* doing further research. But S&P has a reasoned opinion (in that link above.) Seems to me that that is an important piece of evidence that needs to be evaluated. I'm long two Canadian banks too, so I naturally want to understand the potential risk. If you have a concrete reason for ignoring what S&P has to say, I'd be curious to hear it. Is there someplace where you have done "a bit more research" that developed your opinion? If so, I'd sincerely like to know about it.

    "Protect yourself at all times," as they say in Million Dollar Baby. If I see a red flag, I think I need to look into it.
    Dec 4, 2014. 01:37 AM | 1 Like Like |Link to Comment
  • Consider Canadian Banks For Your Dividend Growth Portfolio, Like Bank Of Nova Scotia [View article]
    I was recently considering a purchase of BNS and found it on negative credit watch on A further search revealed that RY, TD, BMO, and CM, i.e. the entire big five, are ALL on negative watch. Does the author (or anyone else) have any further information on this situation and how serious it is? Further information here:, but I am still trying to digest this and determine its importance.
    Dec 4, 2014. 12:03 AM | 1 Like Like |Link to Comment
  • Seadrill And The Ghost Of Frontline [View article]
    "When you can not trust management, it is time to sell IMHO..."

    Ryan, I basically agree. Jeffrey Immelt promised no dividend cut at GE, too. In that case, with a significant position, I sold, and have found other places to get comparable or better dividends and growth without "liar risk." And I sleep better.

    In the case of SDRL, I own a princely 100 shares that I bought as a pure speculation. The story seemed good, but I didn't know the history of Fredricksen and Frontline at the time. So at this point, what's to lose by hanging on and hoping Mr. Hoerth's thesis is basically correct? I've never placed a $1000 bet in Vegas, but now I'm going to see what it feels like. Just as long as we are clear that this has nothing to do with *investing.*

    The inimitable Chowder advises never investing in a company whose credit is not rated BBB+ or above. A pretty simple rule to follow. Lesson learned.
    Dec 3, 2014. 11:11 PM | Likes Like |Link to Comment
  • Lockheed Martin's Impressive Dividend Growth [View article]
    No doubt that there have been and are some defense programs that were boondoggles, but to read the commentary here you would think that LMT, GD etc have never developed any aircraft, weapons technology, etc that were of any value, and that the boondoggles represent the great majority of the defense industry's business, rather than a small minority. Very difficult to calculate the deterrence value of good military hardware, or the psychological value of living in a country that is very unlikely to be directly attacked, but given that the percentage of the federal budget devoted to defense has been shrinking for the last half century, I'm satisfied with the bang we have gotten for the buck.
    Dec 3, 2014. 01:24 PM | Likes Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Chevron Corporation [View article]
    Here is a good piece on how mechanical reliance on the current ratio can be misleading:
    Nov 30, 2014. 12:41 PM | 1 Like Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Chevron Corporation [View article]
    "CVX is suitable for the Enterprising Investor but not the more conservative Defensive Investor following the ModernGraham approach."
    Nov 30, 2014. 12:34 PM | Likes Like |Link to Comment
  • Why I'm Considering Selling My Core Position In Coca-Cola [View article]

    Let me come at this from a slightly different angle.

    You say you have a portfolio of approximately 50 stocks. Now, when you look at a list of all your stocks, is KO really *the weakest link*, the one you think there is the BEST case for selling?

    To my way of thinking, in a 50-stock portfolio, you want to be diversified not only in terms of market sectors, but in terms of growth and income characteristics. That is, some slow growers with high yields (think T), some strong growers with lower yields (think UNP or VFC), and many in between (e.g. JNJ, LMT.) I try to stick mostly with companies that are investment-grade credit risks, mostly stocks with betas <= 1, and mostly stocks from the CCC list. Given that perspective, I think that if I owned KO (which I don't), it's extremely unlikely that I would view it as the *most dispensable* stock in my portfolio. For a middle-of-the-spectrum stock, it has almost all the characteristics I am looking for. I don't require every "core" stock in my portfolio to have strong growth, and I know that the narrative surrounding a stock goes through better and worse periods over the long run.

    Now, if I was looking to buy a stock right here, would it be KO? Probably not, for several of the reasons you mention. But the decision whether to buy (or add to a position), and whether to hold a stock which has done what I wanted it to over the long haul, are two different things. I won't go quite as far as B&H2012, but I would need a lot more evidence than we currently have to kick one of all-time Aristocrats out of my portfolio.
    Nov 29, 2014. 12:45 PM | 4 Likes Like |Link to Comment
  • Income Investor Tips For Tax-Loss Harvesting [View article]
    This is a finance site for readers with a sense of humor and irony.
    Nov 28, 2014. 11:09 AM | 6 Likes Like |Link to Comment
  • The CEO May Be McDonald's Secret Sauce [View article]
    Without an analysis of Don Thompson's major decisions, one by one, this article tells me nothing I didn't already know.
    Nov 15, 2014. 03:43 PM | Likes Like |Link to Comment
  • BCE Inc - A Cash Flow Machine That Belongs In Your Portfolio [View article]
    RAS, You take my metaphors WAY too seriously and literally. I would say that companies (including ADRs) are *rewarded* by earning a place on the CCC list. Pari passu, my point in using the word "punishment" is just that while companies truly *earn* their place on the list by increasing dividends, they can get kicked off because of something (currency fluctuation) that is completely beyond their control. I do think it's a little ironic. It was not a slap at David Fish, whose labors I greatly appreciate. It's a free country and he can set up the criteria for his list any way he wants. But for those who are focused on dividend growth as an indicator of company strength rather than the rather more narrow issue of what ends up in their pocket, the dropping of stocks due to currency fluctuations is an unfortunate consequence of a reasonable decision.

    R2R, thanks for the link to the UK champions list. I was aware of the Canadian version but not the new UK list. I know the fellow says it's a work in progress, and again I am not intending to be critical of volunteer work, but I sure wish he had a column for Yield %!

    I think all three of us are in agreement about the importance of dividend growth, and looking beyond one's own borders.
    Nov 14, 2014. 11:56 AM | Likes Like |Link to Comment
  • BCE Inc - A Cash Flow Machine That Belongs In Your Portfolio [View article]

    Thank you for clarifying this. It illustrates a core issue in dividend growth investing. Is what we are interested in a sound, growing business which demonstrates the fundamental ability to generate an increasing dividend in its native currency, or the *short-term* result as the US and Canadian dollars fluctuate up and down a few pennies against each other, as they have since the beginning of time? I always thought DGI was about taking the long view. If one is going to invest outside the US (and particularly in stable economies such as Canada's), then it seems clear to me what the answer is.

    Unfortunate, in my opinion, that the CCC list has chosen to punish Canadian companies on the basis of a fluctuation they can't control. The worm will turn, of course.
    Nov 14, 2014. 12:12 AM | Likes Like |Link to Comment
  • Utilities Shouldn't Return 18% [View article]
    "I'll gladly take a growing income stream and wild price volatility rather than a wild income stream and steady price movement."

    Excellent last sentence, and a great takeaway from the article.

    In contrast to all those screaming that utilities are overvalued, I note that SO is still offering an almost 4.5% dividend, which is pretty good. FASTGraphs shows it only mildly overvalued (less so than a couple years ago, and much less than, say, NEE.) If the stock goes down a few points, which is certainly possible but not what I'd call "wild" volatility, you can buy more at a higher yield. As Dr. Kemalyan observes, they're not going out of business.
    Nov 12, 2014. 05:51 PM | 1 Like Like |Link to Comment