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Buyandhold 2012

Buyandhold 2012
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  • Retirement Strategy: Sometimes It's Easy To Put Cash To Work [View article]
    RS,

    Not buying anything at the moment because I am an optimist and think that the stock market will go quite a bit lower at some point in the future, but if I had to buy stocks today, there are many companies that appear to be a bargain.

    Exxon Mobil, Philip Morris, McDonald's, Coca-Cola and AT&T all appear to be in the discount bin at this time.
    Oct 25 05:06 PM | 3 Likes Like |Link to Comment
  • Victory For The Bears [View article]
    "The last two weeks has provided a pivotal and decisive victory for long-suffering stock market bears."

    Eric, if the last two weeks was a stock market correction, it was pretty anemic.

    I am waiting for the S&P 500 to fall at least 20% from its all time high before I will begin adding to my positions in equities.

    They say that good things come to those who wait.
    Oct 25 12:44 PM | 4 Likes Like |Link to Comment
  • McDonald's In Crisis, Dividend Growth At Risk [View article]
    The Rebel,

    Thank you for reminding me of my rule not to buy unless there is a correction of at least 20% in the S&P 500.

    McDonald's was becoming so attractively priced that I was thinking of breaking my 20% rule and buying it anyway.

    Thank you for reminding me not to make rash decisions.
    Oct 25 10:54 AM | 1 Like Like |Link to Comment
  • When Opportunity Knocks, It's Wise To Open The Door - Low Valuation Trumps Growth [View article]
    StepUp,

    Thank you for the correction. The dividend is 2.7%.

    Now I am slightly less enthusiastic about IBM than I was previously.
    Oct 24 08:41 PM | Likes Like |Link to Comment
  • McDonald's In Crisis, Dividend Growth At Risk [View article]
    I am losing track of how many negative articles about McDonald's I have read on Seeking Alpha lately.

    That is a sure sign that McDonald's is becoming attractively priced again.

    McDonald's is near a 52-week low. The PE ratio is only 16. And the stock's performance since it went public has been truly outstanding.

    McDonald's is one of the best of the Dividend Aristocrats. I am watching McDonald's and waiting for a slightly better price.
    Oct 24 08:21 PM | 8 Likes Like |Link to Comment
  • When Opportunity Knocks, It's Wise To Open The Door - Low Valuation Trumps Growth [View article]
    There is a lot to like about IBM at its current price. It is near a 52-week low. The PE ratio is only 13. And the dividend is over 4%.

    But I will not be buying IBM at this time. The stock market is close to an all-time high. If we have a substantial stock market correction in the next 12 months, the price of IBM could go lower.

    IBM is a stock that I am watching, but not buying at this time.
    Oct 24 08:11 PM | 1 Like Like |Link to Comment
  • No One Wants To Hear Anything Good About Amazon, But... [View article]
    Dana,

    I have been making nothing except negative comments about Amazon for over one year now.

    I don't buy stocks with PE ratios above 20.

    If Amazon ever has a PE ratio of 20 or lower, at that time I will consider buying it. Until then, I will have to pass.
    Oct 24 10:50 AM | 2 Likes Like |Link to Comment
  • My Dividend Stocks Aren't For Sale [View article]
    Eli,

    This is my favorite of all of your articles on Seeking Alpha.

    My dividend stocks aren't for sale, either. I have never sold even one single share of a dividend growth stock in 44 years and don't plan to sell any during the remainder of my life.

    Selling a dividend stock is a bad idea for so many reasons.

    1) It usually takes 30 or 40 years for the snowball effect to turn a modest amount of money into a large amount of money.

    2) Dividends are taxed at a favorable rate.

    3) Never selling avoids capital gains taxes.

    4) Your heirs receive a stepped up cost basis.

    5) Dividends allow your income to keep up with inflation.

    6) More shares of dividend stocks can be purchased whenever the stock market is relatively low.
    Oct 23 02:56 PM | 5 Likes Like |Link to Comment
  • Note To Warren Buffett: Dump Coke, Pay Your Taxes, And Get On The Right Side Of History [View article]
    Dump Coke?

    Jim, what can I say?

    That has to be on the top ten list of worst advice I have ever read on Seeking Alpha.

    Jim, I wanted to buy Coke back in 1974 when it was 30 dollars a share and paid ten percent. My stockbroker at that time gave me some very bad advice. He said: "Coke is not a good buy at this time. It is too risky."

    100 shares of Coke purchased in 1974 and then never sold would be worth a lot of money today.

    Dividend Aristocrats should never be sold unless there is some sort of financial emergency. I have been a dividend growth investor for 44 years. I now receive more money in dividends each year than I originally invested. I would never in a million years sell any of my stocks and pay the large capital gains tax.
    Oct 23 12:31 PM | 4 Likes Like |Link to Comment
  • My Dividend Growth Investing Epiphany [View article]
    Dividend House,

    I am glad that you had an epiphany regarding dividend growth investing. It is the most conservative and reliable way to achieve a financially secure retirement.

    I became a devout dividend growth investor 44 years ago not because I had an epiphany, but because I enjoyed receiving ever increasing dividend checks and because I realized that everyone I knew with a substantial stock portfolio had bought stocks 30 or 40 years ago and then had never sold them.

    I did finally experience an epiphany about 25 years after I had become a dividend growth investor. I was astonished by the way that buy and hold dividend growth investing could turn a small investment into a large amount of money over the long term.
    Oct 23 10:00 AM | 11 Likes Like |Link to Comment
  • Retirement Strategy: Is It Time To Dump These Dividend Aristocrats? [View article]
    RS,

    Dump a Dividend Aristocrat?

    McDonald's and Coca-Cola are two of the best Dividend Aristocrats. If I were a shareholder of McDonald's and Coca-Cola, I would never sell them. I would also continue to accumulate shares during substantial stock market corrections.

    Someone who invested $10,000 in Coca-Cola or McDonald's 40 years ago and then never sold would have a substantial portfolio. Should that person sell and pay a huge capital gains tax and lose future dividends which are taxed at a favorable tax rate?

    There really is never a good reason to sell a Dividend Aristocrat unless the money is needed for some sort of financial emergency.
    Oct 23 09:53 AM | 1 Like Like |Link to Comment
  • 8 Major Reasons Why The Current Low Oil Price Is Not Here To Stay [View article]
    Value Digger,

    I agree with you that low oil prices are not here to stay. But when you recommended Petroamerica Oil, a stock that is 26 cents a share, I had to read it twice to make sure that I had read it correctly.

    A stock that is 26 cents a share????

    There are so many fine companies in the energy sector. Exxon Mobil, Chevron, Schlumberger, Williams, Devon Energy.

    But a stock that is 26 cents a share? That's like jumping out of an airplane without a parachute.
    Oct 22 01:41 PM | 7 Likes Like |Link to Comment
  • What Likely Happened To Dividend Growth Retirees In The Recessions [View article]
    Dale,

    I am a hardcore buy and hold dividend growth investor who had been through at least three substantial stock market drops. 1973-1975, 2000-2002, 2007-2009.

    They keep talking about a flashcrash that occurred at some point, but it was so fast that I barely recall it.

    A few of my dividend stocks cut their dividends in 2002 and 2008, but my other dividend stocks either kept their dividends the same or raised them.

    During all three substantial stock market drops, I bought more shares of dividend growth stocks at discount prices.

    Department stores are always having sales. But the stock market does not go on sale that often. The savvy investor keeps some cash or "dry powder" on the side to take advantage of substantial stock market drops whenever they occur.
    Oct 22 08:52 AM | 23 Likes Like |Link to Comment
  • What To Do With Capital Gains? [View article]
    "When should you sell a dividend stock for capital gains?"

    If the stock is a Dividend Aristocrat or a Dividend Champion, the best time to sell it is never.

    It takes 30 or 40 years to turn a $10,000 investment in a dividend growth stock into a substantial amount of money.

    Time is an investor's best friend in the stock market.
    Oct 21 06:38 PM | 4 Likes Like |Link to Comment
  • What Do You Do If Share Prices Drop 20%? [View article]
    Dubbs3,

    I also like Dover. It is a Dividend Aristocrat.

    My favorite dividend stocks in order of preference are: 1) Philip Morris 2)Exxon Mobil 3) Johnson & Johnson 4)Abbott Labs 5) Pepsico

    "Never sell" for me is not a bold statement. It is an accurate statement. I have never sold even one single share of stock in 44 years except when one of my stocks was bought out and I was forced to take the cash. Time is an investor's best friend in the stock market.
    Oct 21 06:32 PM | 5 Likes Like |Link to Comment
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