Seeking Alpha

Michael Connellan

 
View as an RSS Feed
View Michael Connellan's Comments BY TICKER:
Latest comments  |  Highest rated
  • Alliance Resource: Strong Mid-Cap Income Holding In Core Industry [View article]
    I like to keep it simple, and the core of the business is ARLP so that's what I invested in. Good luck with it!
    Dec 22 08:00 PM | 1 Like Like |Link to Comment
  • Alliance Resource: Strong Mid-Cap Income Holding In Core Industry [View article]
    AHGP's distributions ran up a lot faster - 27% v 13% - for the last 5 years but the way I read AHGP's SEC form 10-K, they're now at the maximum 48% of ARLP's distributions on the incentive plan so from here on it looks like the distributions increase at the same pace. So, I'll just stay in ARLP; their future looks good.
    Dec 21 12:49 PM | 1 Like Like |Link to Comment
  • 6 Types Of Dividend Investment Strategies, Part I [View article]
    Good article! Regarding your opening question, though, and as you know, if you hold a stock indefinitely it doesn't matter whether the return comes from the current yield [CY] or the growth rate of the dividend [DGR]. The overall return is simply the sum of the two. This is a version of the Gordon Growth Model which states that

    Value [of the stock] = Dividend in $/
    (required % return - dividend % growth rate)

    A related version is the Dividend Discount Model.
    Dec 20 02:58 PM | 1 Like Like |Link to Comment
  • Handling Your Emotions: Using Asset Allocation And Beta [View article]
    I've seen 3 and 5 yr betas, and they differ. Seems longer would be better. I do my portfolio calculation based on a weighted overall average using market values.
    Dec 19 11:58 AM | 1 Like Like |Link to Comment
  • Handling Your Emotions: Using Asset Allocation And Beta [View article]
    I think that's a key point - peace of mind. If you're taking out 4 percent, every major decline would be simply depressing!
    Dec 19 11:56 AM | 1 Like Like |Link to Comment
  • Handling Your Emotions: Using Asset Allocation And Beta [View article]
    I think you have a really fine portfolio! Nice planning! I live in CA so munis have a special appeal, but otherwise your portfolio seems almost ideal.
    Dec 19 12:52 AM | 1 Like Like |Link to Comment
  • Handling Your Emotions: Using Asset Allocation And Beta [View article]
    I agree. I'm retired, but I withdraw only dividends and interest, never principal. I think even a standard 4 percent withdrawal is risky given that markets can remain down for a long time, and these days one could easily live to 90-100 years old.
    Dec 19 12:49 AM | 1 Like Like |Link to Comment
  • 'Show Me The Kwan, Jerry!' Cash Is King [View article]
    10 in a row! :)
    Dec 12 05:06 PM | 1 Like Like |Link to Comment
  • 'Show Me The Kwan, Jerry!' Cash Is King [View article]
    You're right - great business, and great management. Note that when PM was spun off, Louis Camilleri chose to go with PM rather than remain with the US company, Altria. I think that's pretty telling of his views of the future.
    Dec 9 11:34 AM | 1 Like Like |Link to Comment
  • Bank Of New York Mellon - Speculating A Triple Over Several Years [View article]
    Thanks for your insightful comments. I agree that BK was different before the 2007 merger with Mellon. That's most easily seen, I think, in the key banking metric Return on Average Total Assets - before 2007 it was often in the 1.2% to 1.5% range. Currently it's still a good 1.09% [State Street, which you mention, is at 0.97%] but I expect it to stabilize just below 1%.

    However, BK has never had EPS even approaching $3 a share whereas it looks like it will be well over that figure in a few years to the $3.25 area. Also, I know from experience that it takes several years, at least, for a major merger to be fully digested. In 2011 they will be about $2.18 which is the highest ever for BK [reached $2.03 in 2005, pre-merger]. So while different, in terms of EPS it looks like BK is now a more profitable bank than it ever has been before.

    The S&P right now is at just 12.0 times estimated $105 EPS, so even if BK just gets back to the market average, 12 x $3.25 = $39 a share - roughly a double from where it is now. Because it's a global bank the Euro zone is having a huge perception impact, but I think BK has very limited downside, but very substantial upside. Time will tell, right?
    Dec 7 12:13 PM | 1 Like Like |Link to Comment
  • SeaDrill: Q3 Results Continue To Impress, Still Likely To Beat Estimates [View article]
    A note of caution: In my opinion, one should be careful of an investment in a company controlled by John Frederiksen [Chairman & President]. Research his background and record carefully.
    Dec 3 03:50 PM | 1 Like Like |Link to Comment
  • 5 High-Yield Eurozone Stocks [View article]
    Daimler? They resumed their dividend 6/2011 and now yield about 6%, and @ $39 the stock has long term legitimate 3x price potential to $125 based on 2016 cash flow. While a bit speculative with the price impacted by the Eurozone crisis, Daimler {DDAIF} is the world's largest manufacturer of commercial vehicles.
    Nov 27 01:28 PM | 1 Like Like |Link to Comment
  • Why Sustainable Dividends Matter [View article]
    Looking at dividends as a % of Net Income is easy, but useless. The proper measure is to look at cash flow from operations, less maintenance capital expenditures. Dividends are a cash distribution so looking at a non-cash accrual number like Net Income can be very misleading.
    Oct 27 04:50 PM | 1 Like Like |Link to Comment
  • Most Of Our Problem, Still, Is That We Have A Dead Battery: Felix Salmon Is Wrong Edition [View article]
    The amount of taxes paid by the 'Top 5%' has risen dramatically since 1980, contrary to popular beliefs. The 'rich' are paying much more than their fair share. According to the Congressional Budget Office's June 2010 report titled "Average Federal Income Taxes Paid by Income Group", the data is as follows for the top 5% [$160,000 and over]:
    1980 28.7%
    1985 28.4%
    1990 30.6%
    1995 35.4%
    2000 41.4%
    2005 44.0%
    2010 47.1%e
    The answer is not to envy those who've been successful, but to figure out how to help those who haven't been as successful. Most new jobs are created by those who start small businesses, so if you want to reduce unemployment it doesn't make sense to penalize the people who create jobs. Why take the risk and put in the huge amount of work it takes to create a business, if you're not going to be rewarded for it? Or, as Ayn Rand put it, "Who is John Galt?"
    Oct 11 11:12 AM | 1 Like Like |Link to Comment
  • My Ray Dalio-Inspired Income Investing Strategy [View article]
    I like MVO, but please answer a question. For the past 3 years, MVO's cash dividend distributions have exceeded the total cash flow from operations by $3.3-$3.4 million per year. In 2010, for example, MVO generated only $28.4 million from operations yet distributed $31.7 million. However, MVO has no cash on it's balance sheet. So where is the extra cash coming from? If they paid out only what they produce in cash, the dividend would have to be reduced 16.4%.
    Sep 28 07:17 PM | 1 Like Like |Link to Comment
COMMENTS STATS
112 Comments
111 Likes