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Craig Lehman

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  • If I Were Starting All Over Again [View article]
    "So I drove that puppy down to a local Carmax and sold it for a fair price."

    If so, I think you would be the first. We sold our Avalon on Craigslist for more than double what Carmax offered us.

    But other than that, I certainly admire your savings story (although there are cheaper places to live than Florida.) I could quibble with some of your stock choices, but you do seem to be fishing in the right lake. I would recommend looking at David Van Knapp's book, and the portfolios of Bob Wells and Part-Time Investor. I have done well by including a couple lower-yield but higher-growth stocks such as VFC and CVS in my portfolio, but I am not committed to getting my entire return from dividends.
    May 20 11:47 PM | 1 Like Like |Link to Comment
  • Wal-Mart And Target Both Win Right Now [View article]
    Multiple sources say earnings out the morning of Wed. 21, and no indication that they were released today, the 20th.

    I am very worried about earnings based on the data breach, poor Canadian execution, management shakeup, 1st quarter weather, and poor recent results from WMT. Long TGT, but short against the box going into tomorrow. I could be wrong, but I see much more downside potential than up short term.
    May 20 11:24 PM | Likes Like |Link to Comment
  • Managing Low Conviction Positions - Feedback And Strategy [View article]

    If you will look at what I said, I didn't SAY that PE was a good way to look at a bank. And if "any simple channel check" will establish your very large assertions, it would be nice if you would supply a link or two to corroborate your extensive knowledge. If my understanding of commercial banking in Canada is incorrect, a link or two to establish that would be nice as well. How you know what "the Canadian government knows" is beyond me. Do you really expect readers to just accept what you say without any substantiation?

    For the record, the dividends of the Canadian banks did not "just evaporate" in 2008-9. This was discussed AND DOCUMENTED in the thread of Mr. Wells' followup article.
    May 19 09:39 PM | 2 Likes Like |Link to Comment
  • Dollar Cost Averaging Versus Lump Sum Investing [View article]
    Sure! If you imagine putting the money in at the beginning of the year, and the market goes up most years, then OF COURSE lump-sum investing will work better than DCA most years. This is not exactly an astonishing discovery.

    A more realistic test would be to use some kind of simple timing system (e.g. based on moving average crosses) for the lump sum investing -- although even then, investors would probably want to break their lump sum up into several chunks. The key point would be that the money would NOT be mechanically invested on the first of each month.
    May 16 12:26 PM | Likes Like |Link to Comment
  • The 5 Most Overvalued Dow Stocks [View article]
    I'm not much of a technician, but the idea that high relative strength is a negative indicator strikes me as strange. A basic idea of technical analysis is that trends generally tend to continue until some countervailing factor appears. Other things being equal, wouldn't you want to buy a stock with *high* rather than *low* relative strength??? Again, wouldn't one naturally assume that a stock has high relative strength for a reason???

    And it's not as if stocks with a RS of around 70 have really gone to an extreme.
    May 16 12:27 AM | Likes Like |Link to Comment
  • Lowe's Vs Walgreen: Which Retailer Is Best For Shareholders? [View article]
    The question is whether a comparison of retailers is two (very) different industries is very meaningful.

    I also miss the point of a comment about dividend growth rate under the heading of #4, Long-Term [Earnings] Growth Rate. They are two different metrics.
    May 15 12:24 PM | Likes Like |Link to Comment
  • Lowe's Vs Walgreen: Which Retailer Is Best For Shareholders? [View article]
    I miss the point of comparing a drugstore to a home improvement warehouse. E.g. drug purchases are a regular expense, and being driven by Obamacare; home improvement purchases are discretionary and much more subject to economic fluctuations. Wouldn't it make more sense to compare WAG to CVS, or even RAD? Apples to apples?
    May 15 12:03 PM | Likes Like |Link to Comment
  • Managing Low Conviction Positions - Feedback And Strategy [View article]
    "Since then the dividend has grown like a weed and it (YUM) still yields about 2%. Thus it does not rate very high as a pure dgi stock because of that yield and yet I would not think of getting rid of it."


    I've said this before on these boards and it's not a popular view, but... What does DG *mean*? Why, dividend growth, which at a sustained rate of around 15%, YUM has plenty of (doubling its dividend about every five years.) It is not a *high yield* stock, but nowhere in the words "dividend growth" do I find the words "high yield." YUM's strong DG has pulled the share price along with it... just because it currently pays 2% does not mean that YOU are getting 2% on your investment. This effect is duly noted in Lowell Miller's DG classic, The Single Best Investment.

    So no apologies for BDX or CAT! They are about as "pure" as DG stocks can be. (Now, BAC is a different matter.) I completely agree with your symphony analogy, and DG stocks with high or medium yield certainly belong in the orchestra. But lower-yield DG stocks play the same tunes. You can always trade in your piccolo for a bassoon when you want more bass notes.
    May 13 07:40 PM | 2 Likes Like |Link to Comment
  • Managing Low Conviction Positions - Feedback And Strategy [View article]

    I like Kyle Bass and so took the time to listen to the link you provided. Just so other readers are clear, yes, he says that the Canadian consumer is overleveraged and that Canadian homes are overvalued, but he *does NOT* say anything about the Canadian banks and their underwriting standards. As I understand it, the minimum down payment on a home in Canada is 20%, UNLESS CMHC insures the loan against default. In which case, the banks should be insulated against mortgage defaults either because there was a substantial down payment to begin with, or the default insurance kicks in.

    Again in my understanding, Canadian banks engage strictly in commercial banking, and are not allowed to get involved in things like trading mortgage-backed securities for their own account, which was the undoing of the US banks in 2008.
    May 13 01:48 PM | 3 Likes Like |Link to Comment
  • 8 Dividend Stocks With A 15% Yield In 15 Years [View article]
    I figured that the classic example of WM would be thrown back at me. Of course, it's extremely atypical. Intelligent investors will look beyond single data series. If I saw that "Wow, WM has a dividend CAGR of 73%!!!", the next thing I'd look at would be the reason why -- just as I did with the assertion that there are only eight stocks that have managed to grow their dividend at a rate of 20% over four years. Intuitively, the number seemed just as out-of-whack as the WM CAGR.

    In comments, as opposed to academic discussions, I try to avoid unnecessary technical qualifications, unusual methodologies, etc. I relied on CAGR because, following the custom of the CCC list, it's by far the most common way of summarizing multi-year dividend growth rates. Readers who find it useful to employ a stricter methodology than David Fish uses would be well advised to look at RAS's tables.
    May 9 12:43 PM | Likes Like |Link to Comment
  • 8 Dividend Stocks With A 15% Yield In 15 Years [View article]
    6228371: Yep, I meant yield on cost. But, in an era of low inflation, a YOC of over 4% will still be close, four years later, to a real yield of 4% on my original investment.

    You correctly point out one of the great plusses of these rapid growers: the market will almost certainly NOT let their yields mushroom in this way while their price holds steady. Other things being equal, the price will be driven up. And so you wind up with both a decent yield *and* price appreciation, i.e. higher total return. Whether the total return "catches up" with the total return of the higher yielder with slower dividend growth depends on the higher yielder's DGR and price appreciation. As I argued here, in many cases it does.

    RAS: I was referring, of course, to compound average growth rate. If you filter the all-CCC page of David Fish's list for a five-year dividend CAGR of over 20%, you'll find not 8, but 75 instances of such growers -- a healthy 14+% of all the serial dividend growers. If you want to nitpick and throw out the companies that e.g. had a 19% growth rate one year, and well over 20% the other four years, of course you can make it seem like such stocks are very rare birds. Since my objective is to FIND strong dividend growers rather than knock out as many candidates as possible by setting statistical tripwires, I focus on CAGR.
    May 8 07:28 PM | Likes Like |Link to Comment
  • How Do You Manage Your 'Low Conviction' Positions? [View article]

    I looked at, which shows BNS paying a total of 1.70 for 2007, 1.43 for 2008 (one dividend apparently omitted) and 1.67 for 2009. For BMO, they have 2.53 for 2007, 2.63 for 2008, and 2.44 for 2009. Schwartz is generally pretty accurate but David Fish lists BNS as a near-challenger and does not list BMO, perhaps also because their dividend decreased from 2.87 in 2011 to 2.83 in 2012 (according to Dividata.) Actually I couldn't find dividend figures on either BMO or BNS's websites, but I may have overlooked them.

    So depending on the source and the definition of "the recession" being employed, there may or may not have been a dividend cut or freeze, but in any case the larger point is that BNS and BMO did not cut their dividends *very much* anytime during the last few years, and there's a clear enough overall uptrend that I would feel comfortable with the long-term direction and reliability, as I do with RY and TD. My 20% number above was a result of trying to eyeball the numbers too quickly, plus the fact that these banks do not follow the American custom of paying exactly the same amount each quarter.
    May 7 09:34 PM | 2 Likes Like |Link to Comment
  • 8 Dividend Stocks With A 15% Yield In 15 Years [View article]
    Sure. There is no guarantee that you won't live another 25 years, either, given the rather astounding advances in medicine we are seeing. If that's the case, you want some growth in a retirement portfolio, too. The only point on which I disagree with DC is that if you're at retirement age and have not participated in dividend growth, you're screwed. Just filter the CCC list down to the double-digit dividend growers and dig in.
    May 7 01:56 PM | 1 Like Like |Link to Comment
  • 8 Dividend Stocks With A 15% Yield In 15 Years [View article]
    Do the math. A 2% yielder need only grow the dividend 20% a year for FOUR years to get up to a yield over 4%. That is NOT beyond my time horizon, and there are many stocks that have managed to sustain that kind of dividend growth for four (or more) years. Meanwhile, with that kind of dividend growth, you will almost certainly see significant price appreciation.

    I'm all for some 3.5% yielders growing the dividend 9.7% a year. And some higher yielders growing the dividend less. AND some lower yielders growing the dividend more. Dividend growth rate is another good way of diversifying one's portfolio.
    May 7 01:47 PM | 3 Likes Like |Link to Comment
  • How Do You Manage Your 'Low Conviction' Positions? [View article]
    Just to briefly add to my comment above, I'd note that while BMO and BNS cut their dividends in 2008, it was only by about 20%, and they restored them within two years, much faster than the US banks. (I am inclined to give prudent/temporary/cons... dividend reductions the benefit of the doubt.) And while they suffered greater-than-market losses, they also recovered from them much more quickly than US banks. People realized that Canadian banks operate under a very different set of rules.

    2008 was really a once-in-a-lifetime event (or so I hope!) So I'm very skeptical of putting too much weight on metrics that highlight 2008 conditions. No doubt we'll have another bear market, probably sooner rather than later, but I doubt it will result from the same set of conditions.
    May 7 12:12 PM | 3 Likes Like |Link to Comment