Sell In May? Maybe A Little, But Rotate [View article]
I am not necessarily a "believer". I wanted to look at the historical data and see if there were any patterns that had a probability of repeating that were well north of 50%. And it seems there are a few.
Rotation is not painful, it is identical to the notion of rebalancing periodically - meaning adjusting your portfolio to get to a more ideal allocation. Note I am not advocating totally dumping one sector or piling into another, I am advocating considering minor changes in your market exposure and sector weights based on the season.
Regarding trading, we are talking twice a year, I would not classify that as anywhere near frequent.
Regarding your strategy, it is a sound strategy and given that, it sounds like sector adjustment is not for you. Different investors run different strategies, it is what makes markets.
Top Notch Long-Term Dividend Growers [View article]
I like the company, but they are obviously tied to the price of gold, which hasn't been healthy lately, so neither has the stock.
If you are a gold bull, you should like the stock. If you do not think the price of gold will do well in the future, then there is no reason to hold the stock.
Top Notch Long-Term Dividend Growers [View article]
Point #1 - who knows - no one can reliably predict the future.
Point #2 - You seem to want to extend screeners beyond their intent. Their intent is to provide a list of candidates for consideration. Period. If you don't like the list, because the criteria isn't criteria you care about, that's fine. Every investor has their own style. That's what makes a market.
Top Notch Long-Term Dividend Growers [View article]
I wasn't looking to do a back test. I was looking to find companies that have exhibited strong financial results and dividend history over the last 5 years.
A back test is designed to test a strategy by seeing what passed at the time and looking at performance forward. I was looking to find good companies that have executed well in the last 5 years under the assumption that it would be a good place to start the research process for companies that are likely to execute well in the next 5 years.
As stated in the last paragraph, the goal of the article is to find potentially interesting companies to research if the criteria I used to screen is something that resonates for an investor.
Top Notch Long-Term Dividend Growers [View article]
I am testing for stocks that have met the screening criteria as defined based on 5 year operational performance and dividend history. The pass the criteria now which means they have established the operational and dividend track record over the last five years to qualify. That was what I was looking for.
Top Notch Long-Term Dividend Growers [View article]
Yes the criteria applied was based on current metrics. There was no attempt to go back to the starting point and remove dividend and earnings survivor bias.
Stay Married To Your MLP - Divorce Is Expensive [View article]
Glad you enjoyed the article
I actually like EEP going forward. I have not been a fan until recently because of weak growth and poor distribution coverage, but that all seems to be improving. Their growth profile with new capital projects is much better than it has been. However they will probably go to the equity markets at some point in the future for capital. If/when that happens, it is usually a bad week for the stock.
My Favorite MLPs Based On The New Tax Rules [View article]
It is true that for buy and hold, the importance of liquidity is diminished. And the importance of liquidity to an investor will vary directly with the size of the commitment an investor is making towards an MLP.
For me, I like the feeling that if I want to get out (for any reason), I can get out without getting killed. I am sure many other investors will value that less than I do.
My Favorite MLPs Based On The New Tax Rules [View article]
HEP may be an excellent MLP, but they fail the liquidity test for me. Their trading volumes are well under the lowest of the top 20 MLP's by size. Specifically WES is #20 at around 200K shares per day, HEP is less than a fourth of that at around 45K per day
My Favorite MLPs Based On The New Tax Rules [View article]
I used to love EPB, right up until they were bought by Kinder Morgan. That destroyed a lot of capital for EPB investors, me included. Now they are one of two MLPs owned by Kinder Morgan (KMP being the other). So concern about unfavorable treatment by the GP relative to KMP. Or in other words, for me, they didn't get past the first criteria.
My Favorite MLPs Based On The New Tax Rules [View article]
My MLP's are held in taxable accounts only. I have not personally investigated whether holding them in a Roth IRA makes sense or not. There is an article in Seeking Alpha on it that may shed some light on the topic for you
My Favorite MLPs Based On The New Tax Rules [View article]
I left out GP's on purpose because of the high variability of the distribution stream relative to limited partners. GP's is a whole other topic. They also are more likely to fail the liquidity test.
My Favorite MLPs Based On The New Tax Rules [View article]
Regarding WES. The 11.1% is calculated based on the current distribution annualized vs. the preceding 4 quarters. So $.50 is the current distribution ($2.00) annualized. The preceding 4 quarters were ($.48, $.46, $.44 and $.42) or $1.80. Which works out to 11.1%. Now in the case of WES, they have been raising every quarter, which is unusual for a MLP. So $2.00 is probably low, presuming they raise beyond $.50 in the next three quarters.
Regarding EPD, the numbers I have are as follows (distribution and coverage estimates going forward). So if anything, 1.4x is conservative based on analyst estimates.
2012 E - $2.53 and 1.42x 2013 E - $2.70 and 1.40x 2014 E - $2.90 and 1.47x
Sell In May? Maybe A Little, But Rotate [View article]
Rotation is not painful, it is identical to the notion of rebalancing periodically - meaning adjusting your portfolio to get to a more ideal allocation. Note I am not advocating totally dumping one sector or piling into another, I am advocating considering minor changes in your market exposure and sector weights based on the season.
Regarding trading, we are talking twice a year, I would not classify that as anywhere near frequent.
Regarding your strategy, it is a sound strategy and given that, it sounds like sector adjustment is not for you. Different investors run different strategies, it is what makes markets.
Top Notch Long-Term Dividend Growers [View article]
Top Notch Long-Term Dividend Growers [View article]
If you are a gold bull, you should like the stock. If you do not think the price of gold will do well in the future, then there is no reason to hold the stock.
Top Notch Long-Term Dividend Growers [View article]
Point #2 - You seem to want to extend screeners beyond their intent. Their intent is to provide a list of candidates for consideration. Period. If you don't like the list, because the criteria isn't criteria you care about, that's fine. Every investor has their own style. That's what makes a market.
Top Notch Long-Term Dividend Growers [View article]
McDonald's didn't qualify because it has has a payout ratio of 53% and compounded sales growth over 5 years of 3.6%
Walgreens didn't qualify because its compounded EPS growth over 5 years is 1.2%
Apple didn't qualify because it doesn't have a 5 year track record with dividends
The point of screens is to search for stocks beyond your own personal favorites
Top Notch Long-Term Dividend Growers [View article]
A back test is designed to test a strategy by seeing what passed at the time and looking at performance forward. I was looking to find good companies that have executed well in the last 5 years under the assumption that it would be a good place to start the research process for companies that are likely to execute well in the next 5 years.
As stated in the last paragraph, the goal of the article is to find potentially interesting companies to research if the criteria I used to screen is something that resonates for an investor.
Top Notch Long-Term Dividend Growers [View article]
Top Notch Long-Term Dividend Growers [View article]
Stay Married To Your MLP - Divorce Is Expensive [View article]
I actually like EEP going forward. I have not been a fan until recently because of weak growth and poor distribution coverage, but that all seems to be improving. Their growth profile with new capital projects is much better than it has been. However they will probably go to the equity markets at some point in the future for capital. If/when that happens, it is usually a bad week for the stock.
My Favorite MLPs Based On The New Tax Rules [View article]
For me, I like the feeling that if I want to get out (for any reason), I can get out without getting killed. I am sure many other investors will value that less than I do.
My Favorite MLPs Based On The New Tax Rules [View article]
My Favorite MLPs Based On The New Tax Rules [View article]
My Favorite MLPs Based On The New Tax Rules [View article]
http://seekingalpha.co...
My Favorite MLPs Based On The New Tax Rules [View article]
My Favorite MLPs Based On The New Tax Rules [View article]
Regarding EPD, the numbers I have are as follows (distribution and coverage estimates going forward). So if anything, 1.4x is conservative based on analyst estimates.
2012 E - $2.53 and 1.42x
2013 E - $2.70 and 1.40x
2014 E - $2.90 and 1.47x