All I Want For Christmas Is My Dividend [View article]
ufaizan
No I wouldn't. I prefer to find good solid companies that pay a predictable and growing dividend and get into them when they're priced below their intrinsic value. I believe that puts the long term odds of success on my side.
All I Want For Christmas Is My Dividend [View article]
Bruce
"One easy way to find out is to look at a dividend stock with a PE of 15, and a non dividend stock with a PE of 14 (and assuming the fundamentals are the same) which would you buy? I have asked this question of DG investors and never received an answer yet!"
I know you directed the question to DG Ruralist but let me be the first to answer then. My first and leading response would be that "it depends" but then I would say in all likelihood that I would buy the dividend stock. Why is that? We both have different perspectives on dividends and the companies that pay them. You view the dividend as a negative, "something you have to accept to buy a good company." I view the dividend as a positive, something I get along with buying a good company. The it depends part of the response is that even though the fundamentals are the same, there are other factors to consider. The future prospects of each company aren't necessarily the same. Even though the non-dividend paying company might be cheaper on a PE basis, I think the dividend paying company will be a better investment because I believe it will earn more in the future, as the studies and links I included above show. I also believe that the dividend paying company will provide me other benefits along with the dividend and total return, such as disciplined management, more stability, and a better business model. Obviously one has to watch every company, and every investment has its strengths and weaknesses, but we both already know that.
So many of these discussions concerning which is best, dividend or non-dividend, to me are like disputing or discussing the question (using my theme above) of which type of music is best. Arguments can be made for pretty much any style, but it all boils back down to the listener at the end. And investing approaches or styles all boil back down to the individual at the end of the day. I like and prefer dividend growth investing and you like and prefer non-dividend investing (I'm guessing MPT but I could be wrong of course). But either way, we have to do what we perceive as being in our own best interests. Thanks,
All I Want For Christmas Is My Dividend [View article]
Bob
Thanks. You nail it when you talk about what the Dividend Growth Investing authors attempt to do with their articles. Although there have been articles that express disagreement with methods such as selling assets or positions to fund retirement, I think most all articles are written in a positive manner to help other like minded investors. Chuck Carnevale who is so good about reminding us to buy at fair or undervalued levels, David Van Knapp who writes so clearly about the dividend growth investing approach, Tim McAleenan who writes about the positives of dividend growth investing, and yourself when you write about what didn't work for you but what has and how you go about doing it. There are many others that could be mentioned, all with the goal of being helpful. I think the dividend and income community here at SA is a great group and provides a great resource for the individual investor to understand and get better at this approach to investing.
Bob, thanks for reading and commenting and I hope you and your family all have a wonderful Christmas. Take care,
All I Want For Christmas Is My Dividend [View article]
Norman
Thanks, we have pretty much the same philosophy. One of the first things I look for when looking at a company is, does it pay a dividend? Hard for me to make that dog hunt if it doesn't. Thanks for reading and commenting. Hope you're doing well.
All I Want For Christmas Is My Dividend [View article]
Bruce
Thanks for reading and providing a thoughtful response. Hard to say about the studies and data analysis. My thought is we can always find some way to dissect pretty much any study to find things we don't like about it but that doesn't necessarily refute its overall findings. I view it like analyzing a company we're considering investing in, there will always be something in the analysis we question. But we usually come out of it with an overall finding.
I didn't do a very good job of expressing myself with the what I like portion of the paragraph you mention. Basically what I was saying was that it gives me options on how I want to use the dividends. The way I look at removing capital from risk is that if I have $10,000 in a company and I receive $500 in dividends, then I now have $9,500 at risk. I still have the same # of shares and quite possibly, even hopefully, the total unrealized gain will go well above $10,000 and one could argue then I still have $10K+ at risk, but I'm looking at what my initial investment risk amount was. Of course, I could take the $500 dividend and let it accumulate and invest in other companies and it would again be at risk, but I see it as profits being put to use. The point being that I have options on how to use the dividends.
In regard to taxes, I have both a non-taxable account and a taxable account. Taxes aren't an immediate concern in the IRA and in the taxable account I consider taxes a cost of doing business. No different than taxes from a job or other types of income. Tax rates may vary and we want to take what actions we can to avoid and/or reduce them but ultimately, we all pay in some form or other.
Your response to my article certainly doesn't denigrate dividend investors. I view dividend investing as an approach to investing, just like MPT, or total return, or any other label that people apply to investing. They're all different approaches with positives and negatives, and there is no perfect way. We can all find things about each of them we don't like. I don't like the thought under the MPT approach of having to sell my holdings off a little at a time to fund my retirement. Quite frankly, for the most part I don't want to sell any of my dividend investments. I'm more focused on increasing the income from each of them. I may be forced to if a particular investment doesn't do what it's supposed to but that holds true for any investment, regardless of the particular approach. I do hold a small portion of my account for cyclical or growth stocks, which most of will usually pay dividends as well, and I will move in and out of those. As far as baggage of dividend stocks, since I used a music theme for my article, I'll reply with a song, "He ain't heavy, he's my brother."
Again, thank you for reading and providing a reasonable and well articulated response. Take care,
All I Want For Christmas Is My Dividend [View article]
S_P
Thanks. We are in agreement. Actually the sentence following the one you mention where it uses the phrase "return profits" is referring to dividends, at least that was my intention. And most of my portfolio is in those slow and steady dividend paying companies. I keep a little bit of it set aside for cyclicals or growth but very little.
I have the Eartha Kitt version of "Santa Baby." It's a good one.
Thanks for reading and commenting. Hope you have a wonderful Christmas season.
All I Want For Christmas Is My Dividend [View article]
BT
LOL. Thanks for reading. Fortunately I never invested in either of those. Enron was, well, we know what it was. I remember when Kodak was a good company. It just lost its way. The first camera I remember was one of those Brownies, I think it was, that you held in front of you and looked down at the top to see the image before taking the picture. That was a loonnngg time ago.
When To Pay Fair Value For An Excellent Dividend Stock [View article]
Obie, Dave & Miz
Yep, probability just like there's a probability when we get behind the steering wheel of a car that we'll be able to get to our destination and back home safely. We use seat belts (hopefully) which increases the probability that we'll get home safely. The probability that a company with increasing earnings will eventually be followed by an increasing stock price. The more we can do to put the probabilities in our favor, i.e. increase the probability of success by not overpaying but buying at or below fair value, the better off we are. Just my 2 cents.
Putting A Potential Jump In Dividend Taxes Into Perspective [View article]
David
Rudyard Kipling in his poem IF said "if you can keep your head while those all around you are losing theirs, then you'll deal with the tax increases in a rational manner..." Okay, that last part may be a little bit off but I'm paraphrasing and according to today's mainstream media accuracy isn't all that important anyway.
Your imminently sensible article illustrates that it behooves all of us to just sit down and run the numbers and determine exactly what the ultimate cost is to us. Then we can have a logical basis from which we can then decide to lose our heads, ha!
Good article that presents a thoughtful and pragmatic way of analyzing this.
When To Pay Fair Value For An Excellent Dividend Stock [View article]
Tim
"There's no getting around it: time is the necessary ingredient."
Absolutely. I would add patience as a necessary ingredient, which of course goes hand in hand with time. Unfortunately, in today's microwave mentality gotta have it now world, too many people who may think they are investors aren't investors but rather traders. You have to give the dough time to rise and then to bake. It doesn't happen in a quarter or even a year. Anyway, another excellent article.
All I Want For Christmas Is My Dividend [View article]
No I wouldn't. I prefer to find good solid companies that pay a predictable and growing dividend and get into them when they're priced below their intrinsic value. I believe that puts the long term odds of success on my side.
Thanks for reading the article. Best of luck,
Eddie
Dividend Yield Or Dividend Growth? How About Both, With A Dash Of Value For Good Measure [View article]
Nice article. Your last paragraph nails it. Do the work and reap the rewards, don't do it and reap the consequences.
Eddie
All I Want For Christmas Is My Dividend [View article]
"One easy way to find out is to look at a dividend stock with a PE of 15, and a non dividend stock with a PE of 14 (and assuming the fundamentals are the same) which would you buy? I have asked this question of DG investors and never received an answer yet!"
I know you directed the question to DG Ruralist but let me be the first to answer then. My first and leading response would be that "it depends" but then I would say in all likelihood that I would buy the dividend stock. Why is that? We both have different perspectives on dividends and the companies that pay them. You view the dividend as a negative, "something you have to accept to buy a good company." I view the dividend as a positive, something I get along with buying a good company. The it depends part of the response is that even though the fundamentals are the same, there are other factors to consider. The future prospects of each company aren't necessarily the same. Even though the non-dividend paying company might be cheaper on a PE basis, I think the dividend paying company will be a better investment because I believe it will earn more in the future, as the studies and links I included above show. I also believe that the dividend paying company will provide me other benefits along with the dividend and total return, such as disciplined management, more stability, and a better business model. Obviously one has to watch every company, and every investment has its strengths and weaknesses, but we both already know that.
So many of these discussions concerning which is best, dividend or non-dividend, to me are like disputing or discussing the question (using my theme above) of which type of music is best. Arguments can be made for pretty much any style, but it all boils back down to the listener at the end. And investing approaches or styles all boil back down to the individual at the end of the day. I like and prefer dividend growth investing and you like and prefer non-dividend investing (I'm guessing MPT but I could be wrong of course). But either way, we have to do what we perceive as being in our own best interests. Thanks,
Eddie
All I Want For Christmas Is My Dividend [View article]
Thanks. You nail it when you talk about what the Dividend Growth Investing authors attempt to do with their articles. Although there have been articles that express disagreement with methods such as selling assets or positions to fund retirement, I think most all articles are written in a positive manner to help other like minded investors. Chuck Carnevale who is so good about reminding us to buy at fair or undervalued levels, David Van Knapp who writes so clearly about the dividend growth investing approach, Tim McAleenan who writes about the positives of dividend growth investing, and yourself when you write about what didn't work for you but what has and how you go about doing it. There are many others that could be mentioned, all with the goal of being helpful. I think the dividend and income community here at SA is a great group and provides a great resource for the individual investor to understand and get better at this approach to investing.
Bob, thanks for reading and commenting and I hope you and your family all have a wonderful Christmas. Take care,
Eddie
All I Want For Christmas Is My Dividend [View article]
Thanks for reading and replying. We both share the same philosophy.
Eddie
All I Want For Christmas Is My Dividend [View article]
Thanks, we have pretty much the same philosophy. One of the first things I look for when looking at a company is, does it pay a dividend? Hard for me to make that dog hunt if it doesn't. Thanks for reading and commenting. Hope you're doing well.
Eddie
All I Want For Christmas Is My Dividend [View article]
Hope you're still around to collect it. Not sure I will be. Thanks for reading.
Eddie
All I Want For Christmas Is My Dividend [View article]
Thanks for reading and providing a thoughtful response. Hard to say about the studies and data analysis. My thought is we can always find some way to dissect pretty much any study to find things we don't like about it but that doesn't necessarily refute its overall findings. I view it like analyzing a company we're considering investing in, there will always be something in the analysis we question. But we usually come out of it with an overall finding.
I didn't do a very good job of expressing myself with the what I like portion of the paragraph you mention. Basically what I was saying was that it gives me options on how I want to use the dividends. The way I look at removing capital from risk is that if I have $10,000 in a company and I receive $500 in dividends, then I now have $9,500 at risk. I still have the same # of shares and quite possibly, even hopefully, the total unrealized gain will go well above $10,000 and one could argue then I still have $10K+ at risk, but I'm looking at what my initial investment risk amount was. Of course, I could take the $500 dividend and let it accumulate and invest in other companies and it would again be at risk, but I see it as profits being put to use. The point being that I have options on how to use the dividends.
In regard to taxes, I have both a non-taxable account and a taxable account. Taxes aren't an immediate concern in the IRA and in the taxable account I consider taxes a cost of doing business. No different than taxes from a job or other types of income. Tax rates may vary and we want to take what actions we can to avoid and/or reduce them but ultimately, we all pay in some form or other.
Your response to my article certainly doesn't denigrate dividend investors. I view dividend investing as an approach to investing, just like MPT, or total return, or any other label that people apply to investing. They're all different approaches with positives and negatives, and there is no perfect way. We can all find things about each of them we don't like. I don't like the thought under the MPT approach of having to sell my holdings off a little at a time to fund my retirement. Quite frankly, for the most part I don't want to sell any of my dividend investments. I'm more focused on increasing the income from each of them. I may be forced to if a particular investment doesn't do what it's supposed to but that holds true for any investment, regardless of the particular approach. I do hold a small portion of my account for cyclical or growth stocks, which most of will usually pay dividends as well, and I will move in and out of those. As far as baggage of dividend stocks, since I used a music theme for my article, I'll reply with a song, "He ain't heavy, he's my brother."
Again, thank you for reading and providing a reasonable and well articulated response. Take care,
Eddie
All I Want For Christmas Is My Dividend [View article]
Thanks. We are in agreement. Actually the sentence following the one you mention where it uses the phrase "return profits" is referring to dividends, at least that was my intention. And most of my portfolio is in those slow and steady dividend paying companies. I keep a little bit of it set aside for cyclicals or growth but very little.
I have the Eartha Kitt version of "Santa Baby." It's a good one.
Thanks for reading and commenting. Hope you have a wonderful Christmas season.
Eddie
All I Want For Christmas Is My Dividend [View article]
LOL. Thanks for reading. Fortunately I never invested in either of those. Enron was, well, we know what it was. I remember when Kodak was a good company. It just lost its way. The first camera I remember was one of those Brownies, I think it was, that you held in front of you and looked down at the top to see the image before taking the picture. That was a loonnngg time ago.
Thanks for reading.
Eddie
Putting A Potential Jump In Dividend Taxes Into Perspective [View article]
Mediocre is being generous...
Eddie
When To Pay Fair Value For An Excellent Dividend Stock [View article]
Yep, probability just like there's a probability when we get behind the steering wheel of a car that we'll be able to get to our destination and back home safely. We use seat belts (hopefully) which increases the probability that we'll get home safely. The probability that a company with increasing earnings will eventually be followed by an increasing stock price. The more we can do to put the probabilities in our favor, i.e. increase the probability of success by not overpaying but buying at or below fair value, the better off we are. Just my 2 cents.
Eddie
Putting A Potential Jump In Dividend Taxes Into Perspective [View article]
Putting A Potential Jump In Dividend Taxes Into Perspective [View article]
Rudyard Kipling in his poem IF said "if you can keep your head while those all around you are losing theirs, then you'll deal with the tax increases in a rational manner..." Okay, that last part may be a little bit off but I'm paraphrasing and according to today's mainstream media accuracy isn't all that important anyway.
Your imminently sensible article illustrates that it behooves all of us to just sit down and run the numbers and determine exactly what the ultimate cost is to us. Then we can have a logical basis from which we can then decide to lose our heads, ha!
Good article that presents a thoughtful and pragmatic way of analyzing this.
Eddie
When To Pay Fair Value For An Excellent Dividend Stock [View article]
"There's no getting around it: time is the necessary ingredient."
Absolutely. I would add patience as a necessary ingredient, which of course goes hand in hand with time. Unfortunately, in today's microwave mentality gotta have it now world, too many people who may think they are investors aren't investors but rather traders. You have to give the dough time to rise and then to bake. It doesn't happen in a quarter or even a year. Anyway, another excellent article.
Eddie