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Dividend Sleuth

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  • Becton, Dickinson And Company: A Sharp Investment [View article]
    Thanks for a good article, Doc. No position yet but BDX is at the top of my watch list.
    Nov 22, 2014. 08:15 AM | Likes Like |Link to Comment
  • Kinder Morgan: Stock Nosedives, Time To Sell Out Or Buy With Both Hands? [View article]
    KMI is the largest position in my retirement income portfolio, so I'm not buying more at present. It was trading below $35 recently.

    Perhaps it will return to that level and trade in a $34-$42 range for awhile.

    Perhaps it is making a new, higher price range ($37-$45).

    In any case, KMI should continue to increase the payout in future years beyond next year's projected $2.
    Nov 21, 2014. 06:54 AM | Likes Like |Link to Comment
  • Don't Dump Your Johnson & Johnson Shares For VHT Just Quite Yet [View article]
    You raise a very valid point, Varan. If one's objective is growth of principal, then VHT would have been a better choice than JNJ ten years ago. No doubt about that. According to, in the past ten years a $10,000 investment in JNJ would have generated $1,795.29 in dividend income and it would have brought an average annual return of 11.55%.

    Owning VHT for income during this time would have required discipline and some effort to sell shares to raise the income and there would have been some selling expenses along the way (depending on one's trading platform). I would not have wanted to sell shares of VHT during the recession years to raise income. I prefer stocks that pay dividends at least quarterly rather than annually as does VHT.

    My primary objective is growing income via dividends. Hence, my preference would be a stock like JNJ. The less work I have to do, the better. I enjoy monitoring stocks and I'm happy to trade around a core position, to take advantage of extreme valuations which, if done successfully, can augment one's total return. But, I would prefer to be a bit more passive rather than selling stocks quarterly to raise income. I prefer stocks that pay like clockwork, raise their dividends like clockwork, and contribute toward a growing, regular income stream. According to, a $10,000 investment in JNJ would have paid $3,187.12 in dividends over the past ten years and it would have brought an average total return of 8.96%.

    If I wanted growth, I might go for something like Celgene. The same review indicates that a $10,000 investment in CELG would have paid zero in dividends over the past ten years and it would have brought an average annual total return of 31.33%. In retrospect, one could have harvested some shares each quarter to raise income, but it seems to me that no-yield CELG and low-yield VHT are better suited for persons looking for growth rather than income.

    IMO, it's not whether one is right or wrong, but it's a matter of temperament, discipline and the amount of work one wants to put into it. My preference would be for simplicity and for a somewhat passive income stream that grows consistently year after year.

    The great thing about the market is that it offers something for everyone!
    Nov 18, 2014. 10:00 PM | 1 Like Like |Link to Comment
  • Don't Dump Your Johnson & Johnson Shares For VHT Just Quite Yet [View article]
    My focus is growing, safe dividends to supplement retirement income. Here's the VHT dividend history reported by (

    2014 (will be declared in mid-December)
    2013 $1.136
    2012 $1.198
    2011 $1.049
    2010 none
    2009 none
    2008 none
    2007 $.82
    2006 $.615
    2005 $.727
    2004 $.266.

    The current VHT price is $125.56. Seeking Alpha shows the dividend yield as 0.9%.

    Here's JNJ's dividend history for the comparable period:
    2014 $2.80
    2013 $2.59
    2012 $2.40
    2011 $2.25
    2010 $2.11
    2009 $1.93
    2008 $1.795
    2007 $1.62
    2006 $1.455
    2005 $1.275
    2004 $1.095

    (JNJ's string of annual dividend increases began in 1962. At the current price of $108.92, the yield is 2.6%.)
    Nov 18, 2014. 01:10 PM | 2 Likes Like |Link to Comment
  • Prospect Capital And BDC Expenses [View article]
    I'm an interested by-stander, of sorts, to this unfolding drama. My spouse holds shares of PSEC in her account, and I was present for her conversation in response to John Barry's letter asking for an affirmative vote regarding the below-NAV stock sales. The AST Fund Solutions representative dutifully reported the PSEC's pitch and AST's recommendation for a "yes" vote, but he was courteous and did not try to push it when she voted "no."

    As for BDC Buzz, I continue to find him--like Joe Friday--focusing on "just the facts, ma'am." His analysis is very helpful to me.
    Nov 18, 2014. 10:39 AM | 7 Likes Like |Link to Comment
  • The Crash Of Oil Prices Could Be The Opportunity Of The Decade [View article]
    Very helpful article, RS. Thanks for the data about COP. I'm warming up my calculator. I started looking at HP. It flirted with a 52-week low yesterday. The oil patch currently is a great example of "buy straw hats in the winter."
    Nov 18, 2014. 10:27 AM | 5 Likes Like |Link to Comment
  • Don't Dump Your Johnson & Johnson Shares For VHT Just Quite Yet [View article]
    No Buffet here. I'm a big fan of Vanguard. I've lost plenty with both stocks and funds, but so far not with JNJ.
    Nov 17, 2014. 03:27 PM | 1 Like Like |Link to Comment
  • Dividend Aristocrat Overview: HCP [View article]
    Thanks for a helpful article about this Dividend Champion, HD. Slow and steady wins the race. Long HCP.
    Nov 16, 2014. 10:48 PM | Likes Like |Link to Comment
  • Don't Dump Your Johnson & Johnson Shares For VHT Just Quite Yet [View article]
    Doc, I concur with your diagnosis. Long JNJ.
    Nov 16, 2014. 10:42 PM | Likes Like |Link to Comment
  • 3M Remains A Premium Stock Pick [View article]
    Thanks for a good intro to a great company. The price has appreciated significantly since the mid-October swoon, so a patient investor may want to nibble at this one. I'm long MMM and IMO it is a great core holding for any long-term investor. MMM has raised the dividend annually since 1958--when Ike was in the White House.
    Nov 16, 2014. 10:39 PM | 2 Likes Like |Link to Comment
  • PepsiCo: Promising Shareholders Higher Returns [View article]
    Putster--the only difference I see is that preferred stock costs less to feed.
    Nov 16, 2014. 07:41 PM | Likes Like |Link to Comment
  • Becton, Dickinson: Let's Do A Check-Up On Its Fiscal 2014 Earnings [View article]
    David, thanks for a helpful introduction. I've been snooping around for a Dividend Champion in the healthcare sector and I've added BDX to my watch list. I agree with your assessment. It is a great company with a long history of dividend increases, as your article notes.

    The high dividend yield for the last five years has been:
    2010 2.2%
    2011 2.3%
    2012 2.6%
    2013 2.7%
    2014 2.2%.

    The average PE for the last five years has been 16.2 and the current PE is 21.5.

    So, on these metrics, it appears BDX is rather richly priced at the moment--as is much of the broader market. The 52-week price range is $104.94-$131.15.

    I would be happy to take a 1/4 position at a 2.0% yield ($109 at the current dividend), another 1/4 position at a 2.25% yield ($96.89), and a 1/2 position at a 2.5% yield ($87.20).

    Unless we have a major market downturn, I don't think BDX will see $109 anytime soon. That would require a 15.6% correction--possible but not likely. The dividend raise for the last two years has been 10%. BDX should announce a dividend increase soon (see David Fish's Nov 16 article: Another 10% increase would put the new dividend at $2.40. Should that occur, a 2.0% yield would represent a price target of $120, a 2.25% yield would represent a price target of $106.67, and a 2.5% yield would represent a price target of $96.00.

    I would be tempted to make an initial purchase around $120. That doesn't seem likely for the short term, either, but it is within the realm of possibility. Its low was $120.29 on October 16. During the past quarter, the low price was $112.48 on September 24th. BDX held up very well during the mid-October market swoon.

    I have no position in BDX. Currently, it is the only stock on my watch list.
    Nov 16, 2014. 07:33 PM | Likes Like |Link to Comment
  • What Can Be Gleaned From Emerson Electric's Q4 Earnings Release? [View article]
    Thanks, David. Great intro to a great company. I'm long--EMR is a core holding. Anytime one can pick up shares at a 3.0% yield or greater, IMO it is a good long term investment.
    Nov 16, 2014. 06:59 PM | Likes Like |Link to Comment
  • IBM: Has The Stock Reached A Bottom? [View article]
    Sneha, thank you for your article. Is there a price at which you would be a buyer of IBM? (I have no position in IBM.)
    Nov 16, 2014. 05:24 PM | Likes Like |Link to Comment
  • Buffett's Brilliant Duracell Deal: A Reprise Of Past Deals, A Comment On The Present Market, A Whisper About The Future [View article]
    Thanks for your article, Jim. Warren is almost always brilliant. In this case, I see the deal as a win-win. PG is trading at a PE of 25. It's 5-year average PE is 18. It's yield is 2.9%, not bad for this low-rate environment but PG's annual high yield has ranged from 3.3% to 4.6% during 2010-2014. So, Berkshire is getting a bit of a premium for their PG shares. One would expect no less from Warren.

    I think it is also a win for PG. It fits into their plan to downsize and streamline, which I see as a strong positive for the stock. I'm not a big fan of share buybacks--I prefer dividends--but this is an opportunity to return a large block of stock to the company. I would have preferred to fetch them for $75 or $80, but when Warren is on the other side of the table, you won't steal anything.

    I'm sure when PG announced their divestiture plans, Warren became very interested to see what he might scoop up. Long PG.
    Nov 16, 2014. 11:04 AM | Likes Like |Link to Comment