Full index of posts »
StockTalks

Office/Industrial REIT Stats For 092614 http://seekingalpha.com/p/1yvxl 5 days ago

Technology & Industrial Dividend Growth Companies 92614 http://seekingalpha.com/p/1yuw3 6 days ago

Health Care / Pharma Stats 92414 http://seekingalpha.com/p/1yq9f 7 days ago
Latest Comments
 Factoids on Technology & Industrial Dividend Growth Companies 92614 If you begin to see the "yield + CAGRs&quo...
 astarr66 on Technology & Industrial Dividend Growth Companies 92614 Thank you for this interesting article. I belie...
 Factoids on MLP Midstream Stats 92214 The link to a message providing more detail on ...
 pallasathena on MLP Midstream Stats 92214 most useful. thanks.
 Saintsinneridiot on MultiFamily REIT Stats 91914 As always a very helpful article. Great Job!
Most Commented
 What I Have Invested In (17 Comments)
 MLP Midstream Stats And Valuation Assessments (15 Comments)
 A Good Day To Buy ARCC (11 Comments)
 Business Development Company Stat Update 90914 (10 Comments)
 MLP General Partner Stat Update 21414 (8 Comments)
Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.
View Factoids' Instablogs on:
Office/Industrial REIT Stats For 092614
Yields in spreadsheets are the annualized Q314 dividend yields. On 43014 CLI cut its Q3 dividend in half.
Dividend dates are:
The FFO estimates came from Yahoo Finance except for OFC and PLD. OFC's projection came from its web site.
The influence of property cap rates on price/FFO numbers is strong  and explains why NYC property owning REITs like BXP, SLG and VNO have such high ratios.
NOTE: In the spreadsheet below, the FFO estimates and the high and low projections came from the analyst estimate page at Yahoo Finance.
Dividend History based on Q2 Dividends
Disclosure: The author is long OFC, VNO.
Technology & Industrial Dividend Growth Companies 92614
This update is provided to those who require more evidence that a priceimplied forward dividend CAGR can be extracted from P/E Ratios. This system is not perfect  but I believe the data shows the system is good enough. Due to lacking data on historical EPS projection accuracy, my RRRs (Required Rate of Return) assessments lack the quality of those done in sectors where my tracking has been done for longer periods. But the tracking in this sector has been done for a longer period than those for the Health Care / Pharma and Transportation sectors.
There are some weirdly high (or high ratios from low growth large companies) and weirdly low P/E ratios in this sector. Something is going on here. It does not surprise me that there are high variances in the quality of earnings.
Technology & Industrial Dividend Growth Companies 92614
The Q314 dividend is used for yield calculations. This is another sector where the fiscal and calendar years are not in sync. ACN and BBL pay dividends only twice per year  and that quirk is accounted for in the yield calculation and the dividend/EPS ratio. I did not gather beginning of the year EPS projections or targets for ADI, APH, ORCL, TEL and STX  which were added to this universe in August.
Dividend dates are:
Price/Earnings Ratios 0926
Companies that have fiscal years that match calendar years: BRCM, IBM, INTC, NATI, TXN, CAT, DD, GD, GE, HON, MMM & UTX
Companies that are already in fiscal 2015: ACN, ADP, CSCO, MCHP, ORCL, STX and BBL
To calculate the single price implied CAGR that I have historically displayed  I take the RRR and subtract the yield. What justifies that formula? When a stock is correctly valued AND the CAGR is not discounted, then the Yield + CAGR = RRR. Doing the kind of formula manipulation we learned in algebra, we can arrive at a formula for CAGR by subtracting 'Yield' from both sides of that equation. Doing that, we get to 'CAGR = RRR  Yield'. I would want the RRRs to be higher for the riskier stocks for such a formula to produce meaningful output.
When it comes to P/E ratios, a low price/earnings ratio would logically belong to a stock with a lower CAGR or higher risk  and a high price/earnings ratio would logically belong to a stock with a higher CAGR or lower risk. My formula is 'Ratio  adjustment = CAGR'. I would want the adjustment to be lower for the riskier stocks (because risk would already be a factor in producing lower P/Es) for such a formula to produce meaningful output. This adjustment number pivots on the RRR of 10.5  and is the mirror image (compared to the RRR  yield formula) of the difference from 10.5. A RRR of 11.5 (which is 1.0 higher than 10.5) produces an adjustment of 9.5 (which is 1.0 lower than 10.5). A RRR of 9.5 (which is 1.0 lower than 10.5) produces an adjustment of 11.5 (which is 1.0 higher than 10.5).
Why do I provide two different price implied CAGRs? Using the 'CAGR = RRR  Yield' formula, the CAGR can not be greater than the RRR. There are some stocks with 5 year CAGRs above the 10% to 14% range I use for RRRs. Due to EPS' failing to grow in equally stair stepped increments, there are times when the 'PE ratio' based formula fails to produce meaningful output.
Yield + CAGR Total Return Expectations
Disclosure: The author is long AAPL, CSCO, IBM, QCOM.
Health Care / Pharma Stats 92414
This update is provided to those who require more evidence that a priceimplied forward dividend CAGR can be extracted from P/E Ratios. This system is not perfect  but I believe the data shows the system is good enough. Due to my lacking data on historical EPS projection accuracy, my RRRs (Required Rate of Return) assessments lack the quality of those done in sectors where my tracking has been done for longer periods.
There are some weirdly high (or high ratios from low growth large companies) and weirdly low P/E ratios in this sector. Something is going on here. It does not surprise me that there are high variances in the quality of earnings. For example  I am not tracking the percentage of earnings coming from specific drugs that are going 'off patient protection' in the next three years. I would not be surprised if such a metric is needed to understand valuations.
Health Care / Pharma Stocks 092414
Yield in the spreadsheet below is based on the Q314 dividend. Spreadsheet header abbreviations: Div = dividend; EPS = earnings per share; LTM = last twelve months; YTD = year to date. The dividend to EPS ratio is a measure of dividend safety. At this point in time, companies that pay dividends once per year have had their payouts divided by four and encoded in this data is if they paid a quarterly dividend. RHHBY had a two for one stock split on 22714  and that change is not reflected in the data below. BCR has raised its Q314 dividend by a penny.
Dates used to credit dividends:
The Predictive Power of the Dividend/EPS Ratio on Valuations: Dividend to EPS ratios range from as low as the teens to the 80s  and may look all too random. But this ratio  during most time periods  helps explain the variety of yields and P/E ratios. There is some correlation to YTD price changes as well.
The following stocks had Q214 Dividend/EPS ratios of less than 25%: ABC , AGN , BCR , MCK , PRGO , TMO , ZMH , ZTS . Their YTD mean price gain = 16.77% and 2 of the 8 beat the sector mean yearly price gain [13.92%]. Their mean yield = 0.60% and they had an average price/earnings ratio = 21.89. Their mean LTM dividend growth = 8.03% and they had an average CAGR projection of 10.10.
The following had Q214 Dividend/EPS ratios of more than 25%  but less than 40%: ABT , AMGN , BAYRY , BDX , COV , MDT , STJ , SYK , TEVA . Their YTD mean price gain = 14.03% and 3 of the 9 beat the sector mean yearly price gain. Their mean yield = 1.81%  and they sold at an average price/earnings ratio = 17.28. Their mean LTM dividend growth = 21.47% and they had an average CAGR projection of 7.99.
The following had Q214 Dividend/EPS ratios of more than 40%  but less than 50%: BAX , JNJ , NVO , PFE . Their YTD mean price gain = 12.81% and 2 of the 4 beat the sector mean yearly price gain. Their mean yield = 2.66%  and they sold at an average price/earnings ratio = 18.19. Their mean LTM dividend growth = 12.71% and they had an average CAGR projection of 6.80.
The following companies had Q214 Dividend/EPS ratios of more than 50%: ABBV , AZN , BMY , GSK , LLY , MRK , NVS , RHHBY . Their YTD mean price gain = 11.51% and 4 of the 8 beat the sector mean yearly price gain. Their mean yield = 3.51%  and they sold at an average price/earnings ratio of 19.59. Their mean LTM dividend growth = 9.80% and they had an average CAGR projection of 3.95.
Earnings Growth & P/E Ratios 0924
Fiscal and calendar years are not in sync. MCK, MDT and PRGO are already in fiscal 2015.
To calculate the single price implied CAGR that I have historically displayed  I take the RRR and subtract the yield. What justifies that formula? When a stock is correctly valued AND the CAGR is not discounted, then the Yield + CAGR = RRR. Doing the kind of formula manipulation we learned in algebra, we can arrive at a formula for CAGR by subtracting 'Yield' from both sides of that equation. Doing that, we get to 'CAGR = RRR  Yield'. I would want the RRRs to be higher for the riskier stocks for such a formula to produce meaningful output.
When it comes to P/E ratios, a low price/DCF ratio would logically belong to a stock with a lower CAGR or higher risk  and a high price/DCF ratio would logically belong to a stock with a higher CAGR or lower risk. My formula is 'Ratio  adjustment = CAGR'. I would want the adjustment to be lower for the riskier stocks (because risk would already be a factor in producing lower P/Es) for such a formula to produce meaningful output. This adjustment number pivots on the RRR of 10  and is the mirror image (compared to the RRR  yield formula) of the difference from 10. For example, a RRR of 10 produces an adjustment of 10. A RRR of 11 (which is 1.0 higher than 10.0) produces an adjustment of 9.0 (which is 1.0 lower than 10.0). A RRR of 9 (which is 1.0 lower than 10.0) produces an adjustment of 11 (which is 1.0 higher than 10.0). Due to P/E ratios currently being high (something that logically happens when dividend growth is also high), the output of 'Ratio  adjustment' is multiplied by 0.9 to arrive at the priceimplied CAGR.
Why do I provide two different price implied CAGRs? Using the 'CAGR = RRR  Yield' formula, the CAGR can not be greater than the RRR. There are not that many stocks with 5 year CAGRs above the 10% to 14% range I use for RRRs  but there are some. Due to EPS' failing to grow in equally stair stepped increments, there are times when the 'PE ratio' based formula fails to produce meaningful output.
Yield + CAGR Total Return Expectations
Disclosure: The author is long ABC, ABT, AMGN, BAX, NVO, STJ, SYK.