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Jay M. Taylor

 
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  • ITGOW Part 3: SABESP, Water Utility In Brazil's Growing Market [View article]
    I've thought a lot about this actually. Water is unlike any other resource in that it is 100% tied to human survival (food is also, but consumers have much more flexibility to choose alternative food sources). With that in mind, a government claiming eminent domain to secure "strategic resources" is certainly more likely to happen with a resource like water than it is a resource like oil. That said, I think there are 3 good reasons why that won't be the case here...at least for the foreseeable future.
    First, SABESP (SBS) is already 50.3% owned by the State of Sao Paolo and is controlled almost entirely by the government through government-installed executives and board members. And of the remaining shares of the company traded on the open market, roughly half of them are traded through Brazil's stock exchange. Most of the companies that have encountered trouble with the Brazilian government are, as in the case of Chevron and Transocean, not Brazilian companies.
    Second, it seems to me that many of the companies that are facing trouble thanks to the government can be pointed to as polluters, destroyers of natural resources or in the business of taking Brazil's resources outside of the country for economic gain. In the case of SABESP, which is in the business of capturing, treating and distributing water, maintaining water infrastructure, developing water infrastructure in areas in which it has not existed and in providing "sanitation services," I don't see it having the same risk of governmental intervention. I think there's a big difference between some of the publicly traded companies out there (VE included) that buy out private water rights to use for corporate profit and a company like SABESP. I think it's pretty clear that the State is making out quite well with SABESP, and I don't see much reason for it to change that relationship.
    Third, the PRICE of water is still so low compared to the VALUE of water and what it does...so the government impetus to nationalize private companies (if you think the government is being greedy) is more likely to occur with higher price resources. Nationalizing gold, oil, mineral companies seems much more profitable -- oops, I mean "strategic" -- for these governments.
    With all of that said, if I start seeing some of the companies that are part-owned by Brazil (or Brazilian states/municipalities) facing seemingly-superfluous legal, regulatory or financial issues imposed by the government then I would be very inclined to change my mind on this one.
    Thanks for the links you shared, those are great resources.
    Jul 10 07:14 PM | 2 Likes Like |Link to Comment
  • Apple: Eeny, Meeny, Miny Or Mo? [View article]
    I enjoyed your article. Interesting to look back at these how these companies have performed through the years. Like you, I am long Apple both through shares and options. I think what makes Apple so different than a couple of the others you mention above is the way it has become so important to its consumers in the realm of content and software distribution. It just does not fit into the "hardware company" silo that many like to put it in.
    Jul 5 01:07 PM | Likes Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    And I like to have everything in as few places as possible, so I don't want to have direct-purchase plans all over the place. Fees with Sharebuilder are very reasonable in my opinion.
    Jun 5 02:45 PM | 1 Like Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    A couple of years ago my grandmother showed me a statement from her brokerage firm. It had shares of companies like Johnson & Johnson (JNJ) and Kimberly Clark (KMB). I remember her cost basis on JNJ was under $1/share and she had let dividends reinvest until retirement and then turned off the re-investment to start receiving the income.
    I figure, I don't have to do it for my whole portfolio but maybe just for a couple of positions it wouldn't be a bad idea to pick them, get in at a reasonable price, and let them start compounding. Maybe I could let the dividends accumulate and then put them to work at a more opportune time as has been suggested above but I think Ben Graham would agree that letting the DRiP dollar-cost average my dividends into new shares, at least in this part of my portfolio that I plan to manage much more passively than other parts, isn't a bad idea. Time is on my side and for this part of my portfolio I want to pick companies with consistently growing dividends that I expect to still be around when I am ready to retire. This DRiP I'm using is a Roth IRA, which is good because in an IRA or similar tax-advantaged account I don't need to keep track of changing cost-basis due to re-invested dividends.
    Jun 5 02:42 PM | 1 Like Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    Really hadn't heard much about it until I started doing background for this article but it seems at first blush like a more focused investment on McDonald's in emerging markets of South & Latin America. I would really need to spend more time on it to offer more of a comment but it is definitely intriguing.
    Jun 5 01:31 PM | Likes Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    I like YUM and their brands seem strong, especially in China. I'll probably include that in future ITGOW articles. Thanks for reading!
    Jun 5 01:28 PM | Likes Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    That is a great point. I think that is why they went to such lengths to explain their global currency hedging in the 10-Q
    Jun 5 11:57 AM | Likes Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    I think you are right about the issue with the graph. At first I thought it could be related to a split but there hasn't been one since 1999. Then I saw that the dividend went to quarterly in 2008 and knew that had to be it.
    This was my first time trying to use the YCharts tool that SA Editors introduced to us and now I will have a really tough time trusting their graphs because, as you say, annualizing the data would fix that and I would think their database would be smart enough. I submitted a correction to SA that simply removes the chart and changes the language in the paragraph below. It hasn't posted yet but hopefully when it does this will be a non-issue. Thanks for reading!
    Jun 5 11:28 AM | Likes Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    TradeKing sounds like a pretty good tool, I'll have to take a look at it. My Sharebuilder account is $4 for planned (automatic) trades or $9.95 for real-time trades and no fee on dividend re-investments. I've been pretty happy with it so far, especially since I plan to leave it alone and let those fee-free re-investments compound. That said, I don't want my description of what I've done to be construed as a recommendation. Thanks for reading and for turning me on to TradeKing, which I will definitely be checking out.
    Jun 5 11:16 AM | 2 Likes Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    I went there for breakfast this morning and had Oatmeal with Blueberries and Walnut pieces to try their healthy breakfast options. I saw a lot of folks around your age in there doing basically the same thing. Thanks for reading!
    Jun 5 11:05 AM | Likes Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    You're too kind. I blame myself for using that chart as my reference when I was looking for dividend history, rather than getting it from McDonald's website or any number of other places that wouldn't have it so blatantly incorrect. Thanks for reading!
    Jun 5 09:22 AM | Likes Like |Link to Comment
  • ITGOW Part 2: Why I Added McDonald's To My DRiP [View article]
    You guys are both right about the dividend and Ignis you're right as well...why that YCharts graph shows a dividend cut is definitely suspect. I will submit a correction right now and apologize for taking the chart at face value! Thanks for catching it.
    Jun 5 09:14 AM | Likes Like |Link to Comment
  • AAPL Shares Beginning To React To Recent News [View article]
    Thanks, I certainly think so too and plan to hold until we start seeing those catalysts.
    Jun 4 12:24 PM | Likes Like |Link to Comment
  • AAPL Shares Beginning To React To Recent News [View article]
    Thanks for reading!
    Jun 4 12:22 PM | Likes Like |Link to Comment
  • AAPL Shares Beginning To React To Recent News [View article]
    I don't think I have even attempted to call a bottom but consider this pattern: Apple runs up on rumors and various little news stories, blows out earnings, spikes higher then sort of falls out of favor for a period of time. It seems like we have seen this for the past few quarters and with product refresh around the corner, rumors of new products and other little tidbits of news beginning to escalate, I felt more than comfortable both adding to my equity position and adding Calls on Friday's weakness.
    Jun 3 02:04 PM | 2 Likes Like |Link to Comment
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