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PriusBob

 
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  • Dividend Growth Investing And Foreign Companies [View article]
    David
    It seems as if the best, most up-to-date source of withholding rates on dividends paid to US citizens by foreign companies would be Publication 901 on http://www.irs.gov. This is not easy to read. The relevant tables have about 50 footnotes, and the requisite interpretive expertise is not generally extant in the individual investor. In any case, before one goes to all of the trouble to gather up-to-date data about this, one should be sure that the information will make a difference to what you put into your SDG portfolio.
    Sep 21 11:30 PM | Likes Like |Link to Comment
  • Dividend Growth Investing And Foreign Companies [View article]
    IgnisFatuus
    Could you provide the source for this list, and perhaps some information about the "rate" given. What investors would find interesting perhaps would be the rate at which dividend income is withheld from the dividends paid to foreign holders, and whether this varies by account type for the foreigner, etc.
    Sep 21 06:37 PM | Likes Like |Link to Comment
  • Dividend Growth Investing And Foreign Companies [View article]
    This is fraught with difficulties. I researched and had a list once, but it went out of date the following year by about 20% of its entries, since these rates vary each year for each country, as stated in the article. I don't know of a source that is kept up to date, but will keep on the look-out. The IRS (in the US) might have an internal process to keep track of not only these rates, but terms of treaties also.
    Sep 21 03:59 PM | Likes Like |Link to Comment
  • Terrific Growth In Hasbro's Dividend Is Coming [View article]
    If Hasbro continues its dividend growth anywhere near the 25% growth over the last 11 years, the cash required would be doubled in about three years, or slightly more time since some fewer shares could be involved. If net income and free cash flow are growing at some significantly lower rate (say, about 5%), and debt service is increasing, due to buybacks, then something has to give. There is just not enough money to maintain this path. So I do not see how you can be confident about dividend growth under this scenario. I don't have the details about your models, so I can't speak directly to them.
    Sep 13 12:39 PM | Likes Like |Link to Comment
  • Confessions Of A 'DGI Lite' Investor - Part 2: Creating The DGI Lite Portfolio [View article]
    You emphasize that your goal is the growth of the dividend income stream. If so, your rules, etc., seem to result in (a) the prevention of a reduction in growth, and (b) enhanced yields. It is important, I believe, that these two results (if achieved) will not result in much growth in income due to increased dividends. This may be ok for you.
    Sep 12 10:56 AM | 1 Like Like |Link to Comment
  • Terrific Growth In Hasbro's Dividend Is Coming [View article]
    Hasbro's investment policies include borrowing money to fund stock buybacks, since free cash flow does not cover both dividend payments and buybacks. This trend is increasing over the last few years. My judgment is that the increasing debt and the adherence to buybacks on the part of management does not bode well for dividend growth in the future, in spite of the growth in dividend payouts since 2005. If my sleep is affected, I tend to look elsewhere.
    Sep 11 12:13 PM | Likes Like |Link to Comment
  • Retirement Strategy: 'Team Alpha' Portfolio Continues To Trounce The Averages [View article]
    Your portfolio is quite a mixture of stocks. However, it is clear that the label "dividend growth" would not apply to some of the stocks in the set. For example, BAC has not had any growth in its dividend for four years, and mreits are reliable high yield assets, but their dividends do not represent growth in the same way that coca cola does.
    My opinion is that to use the phrase "dividend growth" in the context of your portfolio is quite misleading to your readers. Semantically, if you use the words, then the stocks have to have certain income characteristics, or else just be Ok with being misleading.
    Sep 2 03:06 PM | 2 Likes Like |Link to Comment
  • Measuring Dividend Growth, Part 1: Exponential [View article]
    An interest in DGR measurement is not really an effort at precision. Rather, any measurement of DGR should reflect accuracy, but accuracy measuring what? Two "Whats" would be (1) the degree of consistency in the dividend growth over the years, and (2) the amount of dividend growth over the years." My judgment is that current measures do not give me a good assessment of these two things. Most likely, there will be multiple measures of both aspects of dividend growth (yet to be developed), and preferably, such multiple measures should be easy for the ordinary person to compute. I'm working on some measures that involve statistics computed on rolling 5-year CAGRs of dividend growth, rather than statistics computed on the dividend figures themselves, and this looks promising over very long time frames of 29 years or so.
    Jul 26 12:29 PM | Likes Like |Link to Comment
  • Retirement Income: With Low Rates, Where Can You Find Income? [View article]
    Here is what I have always worried about. Even if I can get a balanced, diversified high yielding income portfolio, with the expectation of cashing the dividend checks, after a dozen or so years of retirement, those checks will have lost (perhaps) 50% of their purchasing power, and my expenses have gone up faster than inflation (health care and property taxes). So the real problem for me was to get dividend growth, not a high dividend yield. And this growth needed to be about 2 1/2 times the reported CPI figures. I think that this can be done by selecting just those companies that will raise their dividends by this amount every year into my retirement. The trick is how to find and evaluate just those companies that will meet this test. This is what I am trying to do.
    Jul 11 10:05 AM | Likes Like |Link to Comment
  • Dividend Income Versus Dividend Growth [View article]
    I looked at the dividend growth and the dividend yield of the funds that were mentioned, and (1) the payout growth of the funds was very low or none at all over their lifetimes; and (2) the yields initially were also low compared to yields on many individual dividend stocks that one could pick from. So I am not sure what to make of the article.
    Jul 5 10:58 AM | Likes Like |Link to Comment
  • 5 Dividend Stocks To Double Payouts In Less Than 5 Years [View article]
    The last five years of dividend growth looks great, and it would have been great to have bought them 5 years ago. It seems to me that the odds of this growth continuing are close to zero, primarily because the growth of financial metrics that would support the cash flow to do so have not been sufficient over the last five years, and can not be expected to be sufficient over the next five years.
    May 23 02:02 PM | Likes Like |Link to Comment
  • Variability In Dividend Growth Rates [View article]
    A good way to measure this intra-company variability in its dividend growth rate is to (1) take a "rolling" CAGR, which can be a 5-yr rolling CAGR, defined as the CAGR for (say) 2000 to 2004, then a CAGR of 2001 to 2005, and continuing up to the present, then (2) take the standard deviation of these CAGRs, and you have a measure of the vaiability of the dividend growth for this company. The five-year period for the CAGRs seem to be best and would reflect all of the variability in the stocks mentioned. For EMR, this standard deviation for 5-yr rolling CAGRS (since 1994) is 3.15%, whereas for MCD, it is 11.69%. But the champion of consistency is PG where the same measure is .99%. Consistency of growth is, for me, an important measure of how well I sleep at night.
    May 10 02:38 PM | 1 Like Like |Link to Comment
  • In Search Of Dividend Growth: Dividend To Free Cash Flow [View article]
    You can research this on your own, and it would be instructive. I've done this for other company events, and so far it does not predict things all that well. If you take annual reports for 2009 and 2006, you would have six data points for (a) cash flow from operations, (b) capital expenditures (subtracting one from the other to get free cash flow), and (c) dividends paid. So you just divide (c) by the result of subtracting (b) from (c) and you have six values for the years 2004 thru 2009. My opinion from my research is that dividend cuts are predicted by some change in the relationship between net income and free cash flow, but I can't figure out exactly what changes are relevant. Most people aren't keeping track of these variables for enough companies, and I keep track of all of these variables for about 50 companies and still can't figure it out.

    Priusbob
    Mar 16 10:10 AM | 1 Like Like |Link to Comment
  • In Search Of Dividend Growth: Dividend To Free Cash Flow [View article]
    My opinion is that the term "payout ratio" can be used to refer to the free cash flow in the numerator, so long as you say that is the definition that you are using. No one has made a rule that the term "payout ratio" must mean usage with earnings. What is important is that one define one's terms, and then everyone's understanding follows. There is no need to make up another term. On the other hand, the rules also do not say that you can't make up another term if you want.
    I talk about and think about "payouts" as coming from free cash flow, when a company pays me. So naturally, I talk about and think about payout ratios as also coming from free cash flow. But everyone is different in their use of words, so long as we are clear.
    Mar 15 10:44 AM | 2 Likes Like |Link to Comment
  • A High-Dividend-Growth, Low-Payout-Ratio Portfolio [View article]
    Jeff

    Could you tell us which tool you use to create virtual portfolios. Does it track dividend reinvestment, commissions, all other types of transactions, etc. Thank you

    Priusbob
    Feb 18 02:07 PM | Likes Like |Link to Comment
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