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John D. Thomason  

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  • Yield, Value, Safety - Available With (Some) Integrated Oils [View article]
    I added to my position in TOT yesterday at just under $50. My approach is to hold a core position, and add extra shares as market fluctuations cause price drops that I consider too good to pass up. The shares I bought yesterday were the first add-on to my core position since I sold shares at the end of October 2011 for $55.75, which I had only acquired in August 2011 at less than $45. So, I am a long-term investor primarily and a trader sometimes. I will buy more upon a drop below $45. Upon a rise above $55 or $60, I will sell my excess shares, but not my core position. I base my actions on prices available. I look at charts, but I would be stretching the facts if I said I used technical analysis for buy and sell decisions. For believers in technical analysis, I say more power to you, there certainly are a lot of tools available, but it is not a driver of decisions for me. But thanks anyway for the tip.

    John D. Thomason
    Apr 5, 2012. 11:42 PM | 3 Likes Like |Link to Comment
  • Yield, Value, Safety: Still Available With Selected Utilities [View article]
    No doubt new EPA regulations on coal present risks for coal-burning utilities, with compliance costs and other impacts. This is not the same as nuclear, however, where a serious nuclear accident could basically wipe out the stockholders in the utility involved, along with much more urgent concerns. I believe that the fear of a catastrophic occurrance is why the utes identified as primarily nuclear operators are price-depressed. I know it's a thin reed to grasp, but I am hopeful if the EPA gets too aggressive and threatens the economic viability of a region or sector, Congress will step in. Also, I would hope that regulators would grant some rate relief. There are a lot of moving parts here, and I'm not sure how to factor that into the evaluations without going a lot deeper into it than the high-level analysis presented. But thanks for pointing this out, awareness of possible risks is always a positive when evaluating investments.

    John D. Thomason
    Mar 16, 2012. 10:25 PM | 3 Likes Like |Link to Comment
  • Confessions Of A Retired 1st Year Dividend Growth Investor [View article]
    Hi, Bob,

    Thanks for the message alerting me to your article. Congratulations are certainly in order. Good job!

    As one of your commenters said, I don't worry too much about price fluctuations, especially if the stock is moving with the market or the sector. If the stock is plunging when peers are not, that needs to be investigated - often it is a buying opportunity. My approach is detailed on my website, but one suggestion for you would be to consider an incremental acquisition approach, always averaging down, to get to the # shares desired for a stock. Of course, this strategy assumes that nothing has changed, as far as the company is concerned, and that the price fluctuations are just random noise.

    I'll look forward to hearing more from you on Seeking Alpha.

    John D. Thomason
    Feb 20, 2012. 12:47 PM | 3 Likes Like |Link to Comment
  • Mortgage REITs And Double-Digit Yields: What's The Catch? [View article]
    Thanks much for the encouraging words. I think I am making progress as far as starting to understand the issues and questions to ask oneself before laying out $ on an investment. The work of preparing an article, combined with digesting the comments and responding to further questions raised, aids in that process. So many people in the general public (not true for most of the SA readership) just want a "tip", and have no idea how much needs to be considered, much of which is unique to an individual's situation, before making an investment. Learning what works and what is suitable for oneself is a lengthy process, which probably extends for as long as one is involved in investing.

    John D. Thomason
    Jan 16, 2012. 08:03 AM | 3 Likes Like |Link to Comment
  • Mortgage REITs And Double-Digit Yields: What's The Catch? [View article]
    I suppose what is significant depends upon the person. As stated in my prior article on BDCs, I have set a maximum allocation to what I term "ultra-high yielders" of not more than 15%, with half of that allocated to BDCs. As per the article, I have some trepidation when it comes to mortgage REITs, so I have set my levels to what I'm comfortable with, which is what every investor should do. I also believe the five-year history shows that recent years have been very favorable for MREITs, and I'm a believer in "reversion to the mean" , which could mean the next five years may not be so great for this asset class.
    Jan 15, 2012. 09:09 PM | 3 Likes Like |Link to Comment
  • Linn Effectively Admits To Misleading Investors And Announces Key Accounting Changes [View article]
    I bought in on LINE right at $24, after the big drop, and only a few shares, as my conviction was lacking. I approached it as purely a trade. After the recent one-day surge to $28, I sold, after reading the news. My reaction to the news, that the Berry merger "might" still happen, was "so what", that didn't remove the clouds surrounding LINE. At this point, I'm staying away, LINE still has issues, as your article has pointed out. It will be interesting to see what happens from here.

    John D. Thomason
    Sep 19, 2013. 12:22 PM | 2 Likes Like |Link to Comment
  • Ignore Mr. Market And Focus On Digital Realty's Fundamentals [View article]
    DLR is not the only REIT selling off hard today. Just look at HCN, HCP, O, VTR, to name a few. Other than interest rate concerns, I don't know what is behind it. I just added to my DLR position at less than $55. I'm a believer, but with DLR, I am very close to my maximum number of shares allowed for any one holding, a self-preservation safety rule that I follow no matter how much of a bargain Mr. Market is offering. If it continues down further, I will have to pass on buying more, even if the carnage is sector-wide, not unique to DLR.

    John D. Thomason
    Jul 31, 2013. 01:22 PM | 2 Likes Like |Link to Comment
  • Yield, Value, Safety With Utilities - Redux [View article]
    Hi, Travel4,

    Point well taken. My review was at a pretty high level. Instead of recommending my finalists, I should probably say "worthy of further study". There is always much more to the story than a quick review of numbers can reveal. Thanks for your insights and informative comment.

    John D. Thomason
    Mar 30, 2013. 11:21 AM | 2 Likes Like |Link to Comment
  • Diebold: Is This Value-Priced Dividend Payer A Buy? [View article]
    See my update comment, below. The article was prepared over the week-end, and only submitted yesterday. As of early this morning, when the Diebold news came out, it still had not been published. Anticipating the article would come out soon, I prepared the update below, to be posted as a comment. The big picture has not really changed all that much -- DBD is an under-performing firm in need of a shake-up, and now, it looks like the needed shake-up is indeed happening. For holders, I would say be patient -- the Board is responding, let's see who comes in as CEO and what the plan is before bailing. For investors considering a position, I would recommend caution, as per the article -- either wait to see what happens before buying in, or if getting in to take advantage of the "value", start small and monitor closely. DBD may have further to fall before it stabilizes. The entire episode may provide a good object lesson, in that anything can happen, and often does.

    Even after buying more today, DBD represents barely half of 1% of my portfolio, so I am disappointed, sure, but not in panic mode, now or ever, regardless of what happens.

    John D. Thomason
    Jan 24, 2013. 12:52 PM | 2 Likes Like |Link to Comment
  • Stocks, Options, Taxes: Part V - Options [View article]
    Thanks much, DGM,

    I thought I knew all I needed to know when I started work on the tax series, but as I learned more in doing my research, I found out that there was quite a lot I was not aware of, not having encountered certain situations personally. I believe the tax arena, which affects all investors, can cause some real headaches for the unaware. By bringing out some of the "gotchas", maybe I can help some investors to avoid problematical situations.

    Thanks again for your encouragement.

    John D. Thomason
    Jan 11, 2013. 12:47 PM | 2 Likes Like |Link to Comment
  • Stocks, Options, Taxes: Part II - Dividends [View article]

    The article was written before the New Year's Day compromise was reached. Under the deal, Dividends fared better than expected. The "qualified" distinction goes away, and dividend income will be taxed in 2013 (and beyond, unless further changes occur) the same as long-term capital gains, as follows:

    0% for filers in the 10% or 15% tax brackets.
    15% for filers in the 25%, 28%, 33%, or 35% tax brackets.
    20% for filers in the 39.6% tax bracket.


    John D. Thomason
    Jan 7, 2013. 10:37 AM | 2 Likes Like |Link to Comment
  • General Mills - A Solid Dividend Payer Available At A Reasonable Price [View article]
    Just a few observations from reviewing the prior quarter income statement (from MSN Money) and the latest results, per the 8K filing dated 9/19/2012, available from the GIS website:

    The prior quarter income statement indicated the diluted EPS was based on a share count of 668.3M, as per the MSN Money Website. I would assume this figure would be the shares outstanding at the end of the quarter, which may or may not be correct. The latest release states that the AVERAGE diluted shares outstanding during the quarter was 667M. This is not, I assume, the same as the shares outstanding at the end of the quarter, so these two numbers may not be reconcilable. The $272M spent to buy shares during the quarter would have resulted in a share count of purchased shares, by my math, of around 6.8M. But these shares are not eliminated from the fully diluted shares outstanding, I don't think, they then become Treasury stock. Then, when executives exercise their stock options, the shares they receive come from Treasury stock. Yet another share count can be derived from the 8K, which gives Net Earnings as $548.9M, diluted EPS as $.82, from which it can be deduced that the share count outstanding is 669.4M.

    Based on these observations, I don't believe we have enough information and/or enough understanding of what the information we do have represents, to reconcile the actual diluted share count at the beginning and end of the quarter, the effect of the share repurchases, and any effects from stock options exercised, if any. This would be a good topic for a shareholder inquiry to Investor Relations, to see if they will provide a reconciliation.

    John D. Thomason
    Sep 19, 2012. 12:43 PM | 2 Likes Like |Link to Comment
  • Eaton Corporation: One Of The Few Blue Chips Available At A Value Price Today [View article]
    My normal reaction to an acquisition of this magnitude is negative, but I read a couple of analyst reports and articles that pretty much agreed with the strategy and the potential, so even though I pointed out the concerns in the article, I guess since I bought in anyway, I'm giving ETN's management the benefit of any doubt. Actually, based on what I've read, I don't think integration risk is what one should worry about, it's the risk of a severe downturn in the next couple of years, catching ETN with a weakened balance sheet.
    Jul 30, 2012. 07:00 PM | 2 Likes Like |Link to Comment
  • Yield, Value, Safety And Complications With MLPs [View article]
    I recently (May 14,15,16) attended the Money Show in Las Vegas, and one of the presenters was the team of Elliot Gue and Roger Conrad, creators of several subscription newsletters, including the MLP Investor. They allowed attendees to have access to their current issues of their newsletters, and one article in MLP Investor specifically addressed NGLs. The way things work, per the article, is that if prices for NGLs, which tend to follow oil prices more than natural gas prices, are high vs. natural gas, then demand for processing is higher, as companies have an incentive to extract as much NGLs as possible. Conversely, if natural gas prices are high, companies would only want to process the minimum required to be within pipeline requirements. The article goes on to state that a combination of elevated oil prices and depressed natural gas prices, as we have today, is a boon for MLPs that have NGL processing capacity.

    In the discussions, these guys and others from the industry don't expect natural gas prices to improve much anytime soon, although an unusually cold winter next year would help. One reason is that even though dry gas production may be slowed or halted, there is still a lot of natural gas produced along with oil for wells that are primarily oil producers.

    Just a couple of relevant facts I have been enlightened with since my last comment, that hopefully will be of interest.

    John D. Thomason
    May 19, 2012. 04:44 PM | 2 Likes Like |Link to Comment
  • Yield, Value, Safety And Complications With MLPs [View article]
    Thanks much for all of your encouraging thoughts. As a neophyte author, positive feedback from an accomplished practioner is extremely encouraging.

    I'm wondering if SA has any technical limitations on comments - if they do, your ground-breaking article on MLPs in IRAs has surely tested those limits!

    Thanks again.

    John D. Thomason
    May 1, 2012. 10:47 AM | 2 Likes Like |Link to Comment