What Is More Valuable? Dividend Yield, Or Capital Appreciation? [View article]
As soon as I saw that calculation in the article, I thought to myself "Wrong. This is bad math". I'm glad I didn't have to point out that error to him.
SWOT Analysis Of Altria Group - Is This Dividend Stalwart Right For You? [View article]
You're right, the pie is getting smaller. But looking at the chart one would assume the pie was half the size it was in the 70's. But it's not, instead it is still 75% of the original pie. And as for the declining market, maybe the numbers are off, but the market for cigarettes, based on my last comment, hasn't really declined much at all in 20 years.
SWOT Analysis Of Altria Group - Is This Dividend Stalwart Right For You? [View article]
I just want to point something out about that last chart. I've noticed it in a couple different articles recently, both here and elsewhere, and its been bugging me but I haven't been able to figure out why until just now. Looking at http://bit.ly/11XigXZ to see the total US population at different times, and eyeballing the chart to get the percentages at the beginning of each decade, it seems the TOTAL number of smokers isn't declining as rapidly as the chart suggests.
Again, just eyeballing it, but I don't think the "declining market" that MO followers weep about isn't declining nearly as fast as some reports suggest.
Just ad up the semiannual dividends for each year to get the numbers I had above. I don't know where Morningstar gets their info, but I prefer it straight from the horses mouth.
It's a little late for this, but I just saw this article. DEO has not increased their dividends every year since 2000. In 2007 DEO paid $2.62 in dividends, 2008 paid $2.5, and 2009 paid $2.26. I love DEO, and am long DEO, but I wanted to point out that discrepancy.
Microsoft's Conquest Of The Tablets World Is Well Under Way [View article]
I don't know if it's my computer or what, but I have always had problems with Chrome. The worst thing: it crashes when I go to youtube! Mindboggling to me. I use Firefox for play and Internet Explorer 10 for the work I do on my computer.
Nokia: Did You Make The Same Mistake As Me? [View article]
Since the article didn't mention the mistake, I'll share mine. I bought some May 2013 calls at the 3.50 strike a week early for $.15 each. They ran up as high as $.34 each the day of earnings, and I almost sold but decided to wait until earnings were released. Of course, the stock tanked, and I ended up salvaging them for $.08 each. Lesson learned (hopefully!): Take the money and run.
When Dividend Reinvestment Is The Right Decision [View article]
Thanks for the reply, Ryan. I agree with your point about GIS, and I have a similar situation with DEO. I guess the difference is that I will still be reinvesting DEO's dividend into DEO because even though I feel it's overvalued, I still wouldn't mind having a little bit more of a great company.
From here, I feel there are three possibilities: 1) The share price drops, in which case I only look at the investment if I feel the situation has changed (earnings drop) or I want to pick up a new block of shares (P/E drops). Either way, reinvesting gives me more shares of a company I like. If the situation has changed, then that usually will occur quickly enough that my small amount of dividend reinvestment won't matter. 2) The stock remains about level (earnings grow but P/E drops commensurately) for the next few years, as the company becomes valued more like the rest of the market. I don't mind getting those incremental shares at incrementally lower prices each time, because I still think it's a great business. 3) The share price keeps going up as the P/E continues to expand, in which case the incremental shares the dividend purchases are worth even more. This in my opinion is the worst situation for a company I really like, as I have to think about if the overvaluation is so extreme that I need to take the money and run.
When Dividend Reinvestment Is The Right Decision [View article]
"If your average portfolio dividend yield is 3%, and you blindly reinvest this 3% regardless of valuation, you may be locking yourself into lower returns for this 3%. If instead you pool the 3% and deploy it all into the company that has the best opportunity to generate returns at that time, you make sure every dollar in portfolio is working to its highest potential."
I'm on the side of automatically reinvesting dividends for two reasons. The first is related to the statements above: If you think you can find the best investment for your money every time, then you must be perfect at picking stocks. This is not true of anyone in the world. If you think you can do it more often than not, then you're still well above average. Barring long strings of luck, which do happen, this is still really rare. You can put those dividend dollars in what you THINK might be the best investment, but the future is cloudy to everyone, even the best investors in the world.
The second reason is related to the first. If you are the type of investor looking for dividends to reinvest, then the only reason not to re-invest in the company that sent them to you is if you actively think that's a bad investment going forward, in which case you shouldn't be holding it anymore. Dollar cost averaging means you buy stock on the way up, the way down, at the top, at the bottom, and everywhere in between. Trying to time the market by changing your investment priorities is a fool's game.
FYI: It doesn't seem like it, but I like the article and hope to read more of them from you.
Intel: Earnings Conference Call Post Mortem [View article]
Thanks for the reply Russ. As a lifelong numbers guy, some of the emotions involved in investing are kinda new to me. But I appreciate you saying "At the end of the day, you have to be comfortable with your investments." I think that sums up what I'm dealing with more than anything; some nervousness that I've missed the boat, even though I plan on holding INTC for a relatively long time.
I don't have a lot of experience with options, but the little I do have is mainly in purchasing OTM calls in the hopes of moves up, usually longer dated calls to give me more time to be right. Do you have any recommendations for reading up on options strategies? I'll probably stick to just basic strategies for a while, but I do love reading.
Intel: Earnings Conference Call Post Mortem [View article]
Russ, great article. Like others, I appreciate the hard work you put in to them. You seem to always be more focused on the operations side than the trading side, which I find enjoyable. With the recent runup lately, from $20 to just under $23 as I write this, do you have a price point over which you wouldn't be willing to get into the shares? I am already long, but want to add some more and don't want to overpay here....
I think a lot of people are missing the point of Windows 8. The entire screen you see when you get started IS the start menu, and there is just a lot more ways to customize it.
Microsoft Proved 'Less Bad' Is Good Enough [View article]
I guess maybe you have different expectations for MSFT than I do. What do you expect from them? Were you hoping to see Bing jump to 40% search share? Did you want to see 100 million Windows 8 upgrades? Were you expecting MSFT to have $20Billion in income from their server and tools business?
Seems to me that they have been doing a relatively good job. IBM and ORCL had a crap quarter, yet MSFT's small decline in Server and Tools seems to be a problem to you.
Microsoft Proved 'Less Bad' Is Good Enough [View article]
I have to disagree with your final statements.
"But the company clearly isn't performing all that well. In fact, a case can be made that Microsoft has actually gotten worse since the second quarter."
I am befuddled how you get to that conclusion. Earlier you state, rightly, that "there were several moving parts in Microsoft's performance, which included a 19% increase in earnings, which beat Street expectations by a decent margin. While bears may continue to argue the company's direction, a profit of $6.06 billion is nothing to shake a stick at, especially given that revenue surged 18% to $20.49 billion."
A company with surging revenue that had a quarterly profit of 6 BILLION DOLLARS is clearly not performing well.
What Is More Valuable? Dividend Yield, Or Capital Appreciation? [View article]
SWOT Analysis Of Altria Group - Is This Dividend Stalwart Right For You? [View article]
SWOT Analysis Of Altria Group - Is This Dividend Stalwart Right For You? [View article]
1970 - 38%*200M = 76M smokers
1980 - 35%*226M = 79M smokers
1990 - 25%*248M = 62M smokers
2000 - 22%*281M = 62M smokers
2010 - 20%*307M = 61M smokers
Again, just eyeballing it, but I don't think the "declining market" that MO followers weep about isn't declining nearly as fast as some reports suggest.
The Perfect Portfolio, Evolved [View article]
http://bit.ly/1aunvUb
Just ad up the semiannual dividends for each year to get the numbers I had above. I don't know where Morningstar gets their info, but I prefer it straight from the horses mouth.
The Perfect Portfolio, Evolved [View article]
3 Undervalued U.S. Financials With A Greater Than 2% Dividend Yield [View article]
Microsoft's Conquest Of The Tablets World Is Well Under Way [View article]
Nokia: Did You Make The Same Mistake As Me? [View article]
When Dividend Reinvestment Is The Right Decision [View article]
From here, I feel there are three possibilities:
1) The share price drops, in which case I only look at the investment if I feel the situation has changed (earnings drop) or I want to pick up a new block of shares (P/E drops). Either way, reinvesting gives me more shares of a company I like. If the situation has changed, then that usually will occur quickly enough that my small amount of dividend reinvestment won't matter.
2) The stock remains about level (earnings grow but P/E drops commensurately) for the next few years, as the company becomes valued more like the rest of the market. I don't mind getting those incremental shares at incrementally lower prices each time, because I still think it's a great business.
3) The share price keeps going up as the P/E continues to expand, in which case the incremental shares the dividend purchases are worth even more. This in my opinion is the worst situation for a company I really like, as I have to think about if the overvaluation is so extreme that I need to take the money and run.
When Dividend Reinvestment Is The Right Decision [View article]
I'm on the side of automatically reinvesting dividends for two reasons. The first is related to the statements above: If you think you can find the best investment for your money every time, then you must be perfect at picking stocks. This is not true of anyone in the world. If you think you can do it more often than not, then you're still well above average. Barring long strings of luck, which do happen, this is still really rare. You can put those dividend dollars in what you THINK might be the best investment, but the future is cloudy to everyone, even the best investors in the world.
The second reason is related to the first. If you are the type of investor looking for dividends to reinvest, then the only reason not to re-invest in the company that sent them to you is if you actively think that's a bad investment going forward, in which case you shouldn't be holding it anymore. Dollar cost averaging means you buy stock on the way up, the way down, at the top, at the bottom, and everywhere in between. Trying to time the market by changing your investment priorities is a fool's game.
FYI: It doesn't seem like it, but I like the article and hope to read more of them from you.
Intel: Earnings Conference Call Post Mortem [View article]
I don't have a lot of experience with options, but the little I do have is mainly in purchasing OTM calls in the hopes of moves up, usually longer dated calls to give me more time to be right. Do you have any recommendations for reading up on options strategies? I'll probably stick to just basic strategies for a while, but I do love reading.
Intel: Earnings Conference Call Post Mortem [View article]
Microsoft: Back With A Bang [View article]
Microsoft Proved 'Less Bad' Is Good Enough [View article]
Seems to me that they have been doing a relatively good job. IBM and ORCL had a crap quarter, yet MSFT's small decline in Server and Tools seems to be a problem to you.
Microsoft Proved 'Less Bad' Is Good Enough [View article]
"But the company clearly isn't performing all that well. In fact, a case can be made that Microsoft has actually gotten worse since the second quarter."
I am befuddled how you get to that conclusion. Earlier you state, rightly, that "there were several moving parts in Microsoft's performance, which included a 19% increase in earnings, which beat Street expectations by a decent margin. While bears may continue to argue the company's direction, a profit of $6.06 billion is nothing to shake a stick at, especially given that revenue surged 18% to $20.49 billion."
A company with surging revenue that had a quarterly profit of 6 BILLION DOLLARS is clearly not performing well.