My recent ( 3/2013) personal observations in Beijing are that many women can be seen casually smoking on the streets, usually they stand around at one spot and smoke before they continue walking.
This is a big change to the situation 3 years ago when I lived in Beijing, so many women either had their "coming out" or they have taken up smoking and don't care that someone is watching them.
However, you still don't see as many women smoking as in Western countries.
Philip Morris: Still A Buy At 1-Year High [View article]
that's right, I think 35% in US. (Whereas the companies who deal in Marijuana can't even deduct normal business expenses due to IRS regulations, I have read.)
Philip Morris: Still A Buy At 1-Year High [View article]
Look at it like this: they issue corp bonds in the range of 0.85 to 2.5% yield ( depending on the currency ) and buy back stock for which they would have to pay a yield of more than 3% or sometimes 4%, depending on the stock price. So it's a good deal. When interest rates rise PM is indebted at dirt cheap rates.
On a sidenote, I have read that many stocks' div. yield approaches the company's refinancing cost ( which in these days is done through corp bond issuance instead of bank credits ). So I see a rise for PM's stock price this year, by comparing refinancing costs in 2008 with 2013. check their fixed income info.
Philip Morris: Wait For The Pullback [View article]
Thanks, Bill. I vividly remember the last pullback opp. you published here turned out to be a $1.50 plunge aka as market fluctuation. Appreciate all your hard work!
Finally an article from someone who actually owns PMI. So I guess you have put more effort into researching it than the Bills & Maurers here.
I am sorry, I have not read through your whole article but I agree with you that PMI is a great investment.
As to your statement "While Philip Morris has risen 9% YTD, it has actually underperformed the broader market. In the past year, Philip Morris has only increased 7.63%, compared with 13.11% for the Dow and 13.56% for the S&P."
Well, that is exactly why long term investors into PMI get rich. They use the dividend proceeds to buy more stocks at a cheaper price as opposed to hyped up companies such as Apple.
What We Think Of Philip Morris' Valuation [View article]
Did you do the math? An approx 10% raise lifts dividend to $ 3.74 this autumn. that divided by $ 87 amounts to 4.3%. that is what PMI has to pay for every stock out at that price level. So they love selling corporate debt bonds for well under 3% and buy back stock with the proceeds. So it all makes sense as long as their bond financing is lower than what they pay in dividend to shareholders. AND raise EPS as shares will be retired.
What We Think Of Philip Morris' Valuation [View article]
Go to PMI investor Relation November 2012 presentation. In it you will find PMI's true capital cost. Then compare their capital cost history with the dividend rate development, you will discover that there is a correlation, dividend divided by avg capital cost, the year by year results and the stock price are very close. This year assuming a ten percent dividend raise and further falling capital cost (as they buy back stock that yields over 3% partly with money from debt issuance between 1 to 2 % ) I see PMI at $ 110 to 125 by the end of this year. If the market tanks it might fall with the market somewhere into the $ 70 range but I doubt it as it pays an almost tax free dividend to foreign investors. See my article. Disclosure: 90 % PMI, and Altria on top of that.
Philip Morris: Time To Load Up Some Shares [View article]
All that you need to know as investor is that PM and MO have an outstanding corp. gov. with focus on shareholder return. What needs to be done will be done
Philip Morris: Time To Load Up Some Shares [View article]
I am way more than that, and I have done my homework, see my instablog, that's why. Btw, from memory I think PM raised dividend more often than mentioned in this article, so the author probably did not put much effort into writing this. However, I see PM up, mainly due to its low financing cost. They issue low yield company bonds to buy back high yielding stocks, it makes sense and can be maintained as long as major currency interest ratea remain low.
Philip Morris Continues To Be A 'Best Of Breed' Dividend-Growth Stock [View article]
Do you know what cost is? PMI's capital cost is decreasing, you can find the info in one of their presentations, I think from November. And that is another reason why the stock is up. PMI places low yield debt bonds and buys back high yield stocks. I have observed there is a correlation between PMI's cost of debt,the dividend rate and the stock price.
Big Tobacco Cashing In On Oriental Women [View instapost]
More mainland girls smoke than officials claim, says researcher
available at :
http://bit.ly/11dL1GM
My recent ( 3/2013) personal observations in Beijing are that many women can be seen casually smoking on the streets, usually they stand around at one spot and smoke before they continue walking.
This is a big change to the situation 3 years ago when I lived in Beijing,
so many women either had their "coming out" or they have taken up smoking and don't care that someone is watching them.
However, you still don't see as many women smoking as in Western countries.
Philip Morris: Still A Buy At 1-Year High [View article]
(Whereas the companies who deal in Marijuana can't even deduct normal business expenses due to IRS regulations, I have read.)
And on top of that you have inflation.
Philip Morris: Still A Buy At 1-Year High [View article]
When interest rates rise PM is indebted at dirt cheap rates.
On a sidenote, I have read that many stocks' div. yield approaches the
company's refinancing cost ( which in these days is done through corp bond issuance instead of bank credits ).
So I see a rise for PM's stock price this year, by comparing refinancing costs in 2008 with 2013. check their fixed income info.
Philip Morris: Wait For The Pullback [View article]
I vividly remember the last pullback opp. you published here turned out to be a $1.50 plunge aka as market fluctuation. Appreciate all your hard work!
Philip Morris, Imperial Tobacco, British American Tobacco, Altria Group: Which Is A Better Buy For 2013? [View article]
Thus most of its dividend is tax free for international investors,
see my article.
It's the best deal for me.
Philip Morris Is Not Too Expensive [View article]
So I guess you have put more effort into researching it than
the Bills & Maurers here.
I am sorry, I have not read through your whole article
but I agree with you that PMI is a great investment.
As to your statement "While Philip Morris has risen 9% YTD, it has actually underperformed the broader market. In the past year, Philip Morris has only increased 7.63%, compared with 13.11% for the Dow and 13.56% for the S&P."
Well, that is exactly why long term investors into PMI get rich.
They use the dividend proceeds to buy more stocks at a cheaper price as opposed to hyped up companies such as Apple.
Philip Morris: Step To The Sidelines [View article]
I won't comment on this article as I did not read it.
What We Think Of Philip Morris' Valuation [View article]
An approx 10% raise lifts dividend to $ 3.74 this autumn.
that divided by $ 87 amounts to 4.3%.
that is what PMI has to pay for every stock out at that price level.
So they love selling corporate debt bonds for well under 3%
and buy back stock with the proceeds.
So it all makes sense as long as their bond financing is lower than what they pay in dividend to shareholders.
AND raise EPS as shares will be retired.
What We Think Of Philip Morris' Valuation [View article]
In it you will find PMI's true capital cost.
Then compare their capital cost history with the dividend rate development,
you will discover that there is a correlation, dividend divided by
avg capital cost, the year by year results and the stock price are very close.
This year assuming a ten percent dividend raise and further falling capital cost (as they buy back stock that yields over 3% partly with money from debt issuance between 1 to 2 % ) I see PMI at $ 110 to 125 by the end of this year. If the market tanks it might fall with the market somewhere into the $ 70 range but I doubt it as it pays an almost tax free dividend to foreign investors. See my article.
Disclosure: 90 % PMI, and Altria on top of that.
Philip Morris: Time To Load Up Some Shares [View article]
have an outstanding corp. gov. with focus on shareholder return.
What needs to be done will be done
Philip Morris: Time To Load Up Some Shares [View article]
Btw, from memory I think PM raised dividend more often than mentioned in this article, so the author probably did not put much effort into writing this.
However, I see PM up, mainly due to its low financing cost.
They issue low yield company bonds to buy back high yielding stocks, it makes sense and can be maintained as long as major currency interest ratea remain low.
Philip Morris Continues To Be A 'Best Of Breed' Dividend-Growth Stock [View article]
Philip Morris Continues To Be A 'Best Of Breed' Dividend-Growth Stock [View article]
PMI's capital cost is decreasing, you can find the info
in one of their presentations, I think from November.
And that is another reason why the stock is up.
PMI places low yield debt bonds and buys back high yield stocks.
I have observed there is a correlation between PMI's cost of debt,the dividend rate and the stock price.
As to China, check my instablog
A Rebuttal To 'Philip Morris International: 20% Overvalued' [View article]
Why We're Huge Fans Of Philip Morris's Dividend [View article]