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  • 21 Foreign Stocks Yielding More Than 5% Dividends [View article]
    I don't see why the value of the dollar is relevant at all. But I also do not see why this article is titled editors pick given the fact that it is simply a list of stocks.
    Oct 5 03:02 PM | 2 Likes Like |Link to Comment
  • Six Companies With 20% Yields on Cost [View article]
    Yes, but but a growing yield on cost indicates you are buying quality dividend stocks with rising dividends. It doesn't compound, but it is just one of the things that dividend investors look for.

    YOC shows that the dividend payment has increased since you pruchased the stock. If you bought a stock at $100 with yield of 10% but 1 year from now the dividend is cut by 50%, your current yield might be 10% still if stock price is at 50. But your yield on cost is 5%. So now you have less income..

    Stocks with rising dividends will produce not only a rising dividend income stream, but also rising stock prices. Whether you want to sell or not is up to the individual. Most often however individual investors are better off not doing anything with their investments, than buying when yield is 2.50% and selling when the yield on cost is double what it was, and the stock has gone up 100%.

    Yield on cost is not nonsense. Dividends are not nonsense. Dividend stocks have outperformed non div stocks over past 38 years. (Ned Davis Research). Whether future holds same - I don't know. You mention good companies - very few companies can afford to reinvest ALL of their earnings back at an incrementally high ROE. Berkshire is the exception, rather than the norm.

    You know how I see that you don't get yield on cost? It's with your example that you could sell the company with a high YOC but low current yield AND replace it with a company that pays a high current yield. I could argue that current yield is irrelevant, since it is just the dividend return you could reinvest your capital at for a single year/period. If you sell the 1976 stock now for a company yielding 10% that doesn't grow distributions ( hence yield on cost is always 10%) your purchasing power is lower in 2034 ( at 3% inflation). Thus you might have been better off in the 8% YOC initial investment (that yield 4% today). And that's because lower current yielding stocks of today, can grow dividends faster than companies with high current yields.

    I think you are projecting your negativism on the author's strategy, based on your own predispositions. The author has been writing about dividends, long before the bond bubble of 2010... So if you are implying something then it's just your concern, and it is far away from the truth. If not, then I have misunderstood you.
    Sep 19 04:19 AM | 2 Likes Like |Link to Comment
  • Six Companies With 20% Yields on Cost [View article]
    BMC,

    After reading your comments I think that the article and you are basically saying similar things. Dividend Aristocrats are companies that have raised dividends for over 25 years. Dividend Growth Stocks are companies that can afford to raise dividends for many years.

    Only great companeis can manage to generate so much excess cash flow, that they cannot reinvest all of it in the business at high incremental ROE. So that's why those companies are great.

    I just do not understand, why you do not understand the article? You seem to understand the idea, yet you keep using bad language.

    As a retired investor I buy stocks that pay dividends. The goal is to buy outstanding firms that pay rising dividends, coming from rising EPS. I spend the dividends, and pay for my expenses. I need to eat, pay electric bills, shop every month ( I actually eat 3 times a day ;-)) So I have recurring expenses. That's why I prefer the stability of dividend payments - dividend returns are less variable than price returns. Sure I could buy the next GOOG or AAPL or whatever growth stock and sell portions of my portfolio to fund my lifestyle- but then I am at the mersy of the market and could theoretically end up diminishing my position in the stock. What happens if I keep selling when the stock price is flat or going down for an extended period of time? What happens if it takes the market a few years before realizing how great the company really is, despite the fact that EPS, revenues are going up, and expected to go up?

    With dividend stocks I get a portion of earnings as dividends, and don't have to sell and reduce my position, which would not be nice if the market is in a freefall/recession etc.

    Since there is inflation each year ( on average 3% I would say), I would need a source of income that increases enough so that it could at least match inflation. Dividend growth stocks do that for me. yield on cost is important, because it shows me that my dividend stocks are paying more, based on my initial investment. For a retired investor with $100,000 in 1976, who gets $4000 in dividend income and spends it, inflation is the worst enemy. Thus he needs his income to meet inflation. Because at 3% in 24 years, the purchasing power of the 2010 dollar is half what it were in 1976. Thus if your stocks in 2010 generate $8000 in dividend income, you are a happy trooper.YOC is 8% for you.

    However if your stocks generate $2K or $3K, you are not very happy. Maybe that's why you don't get the article - you are not the target audience for the writer. I am, and I get it. If you don't get it, read teh articles he/she has written before, to get a glimpse of their strategy..
    Sep 18 04:04 PM | 3 Likes Like |Link to Comment
  • Six Companies With 20% Yields on Cost [View article]
    GM has never been a successful dividend stock. It has always paid a fluctuating dividend. The article specifically points out that.

    The author uses YOC ( bid yield is a silly term, that you are using inappropriately per my understanding of the definition) just as an example that solid dividend stocks could provide you with a higher income on a $100 investment, versus a $100 investment in bonds for example. I do not understand what is all the commenting about.
    Sep 18 03:48 PM | 2 Likes Like |Link to Comment
  • Six Companies With 20% Yields on Cost [View article]
    BMC,

    I think you are using the term " bid yield" inappropriately. According to Fidelity:

    Bid Yield is: The highest annual rate of return on an investment (e.g., a bond) at which a buyer is willing to buy a security.

    scs.fidelity.com/webxp...

    What's wrong with the term " yield on cost"? Also, I think you are writing volumes of posts about the authors strategy, but you obviously haven't read anything else from him/her. If you really want to get answers to your questions, read the 400+ DGI has written on SA ( and more on his site).
    Sep 18 03:45 PM | 3 Likes Like |Link to Comment
  • Five Dividend Machines Raising Distributions [View article]
    I second Notbob's opinion. The management of DEO has done the right thing by increasing distributions in their local currency for over a decade. Whether the US dollar appreciates or depreciates versus the pound is not important; forex fluctuations are not important enough to disqualify a company's outstanding dividend growth record. Also, US investors could always hedge their foreign currency exposure. Anyone with $100 could do that these days.

    However over the span of a few years those forex fluctuations are likely to cancel each other out.
    Sep 8 02:29 AM | 3 Likes Like |Link to Comment
  • Five Dividend Machines Raising Distributions [View article]
    Thanks for the update as well. I like Diageo as one of my best sin stocks to own, just like Altria. I doubt that Verizon's dividend is sustainable however.
    Sep 7 01:54 PM | 2 Likes Like |Link to Comment
  • 33 Dividend Champions to Consider [View article]
    If you really enjoy the author's work, you should bookmark their article on the author's site, not on Seeking Alpha. That is how you support the author.
    Aug 13 08:51 AM | 1 Like Like |Link to Comment
  • 33 Dividend Champions to Consider [View article]
    Thomas,

    I have been around for a few decades myself and also have read market sentiment for several decades before that. One thing I know is that there has never been a "perfect" time to purchase stocks. I have also noticed that anytime someone is bearish on stocks, they typically end up losing a lot of money. Using economic mumbo-jumbo doesn't really make your case against stocks any stronger, particularly given the fact that economists typically are bad at forecasting anything. I doubt you are any good at forecasting either (no offense). I would much rather look at how the past has worked out, rather than use economic voodoo to forecast what might happen. The US first started having negative trade inflows in 1980s. Somehow this coincided with a 20 year bull run in the markets. Investors who thought that the world was going under would have been wrong for 20 years.

    The stocks mentioned in this list are global names, which do business on a global scale. I am confident the Global economy would be much bigger in 10 years. It would be even bigger 20-30 years from now.

    The dividend increases are not paltry especially from the list above. It is investing in fixed income "preferred stocks" that only get a high yield today, which becomes worth-LESS as inflation eats your purchasing power. If you don't get it, then anything I keep writing would be a waste of bytes.
    Aug 11 03:15 PM | 6 Likes Like |Link to Comment
  • 33 Dividend Champions to Consider [View article]
    That's a great list of stocks for further research. As an investor in dividend companies, I also have found the dividend champions list to be more helpful and thorough than the dividend aristocrats.
    Aug 11 12:16 PM | 5 Likes Like |Link to Comment
  • 33 Dividend Champions to Consider [View article]
    Thomas,

    Yes, but these investments that you are touting would not increase your dividend income over time. Even worse, you would feel the eroding power of inflation almost immediately, especially if you spend all the income from those investments.

    You should plan for a retirement that would last 20-30 years. As such the highest yielding stocks of today might not be suited for a retirement longer than 5-10 years..
    Aug 11 12:14 PM | 7 Likes Like |Link to Comment
  • Wal-Mart: A High Dividend Growth Stock [View article]
    Actually, if you keep all of the previous Dividend Champions lists for each month since you started the list, you will be able to calculate the monthly returns. So survivorship bias would not be an issue.
    Jul 27 11:01 AM | Likes Like |Link to Comment
  • 45 Dividend Champions With Yields Higher Than Long-Term Treasuries [View article]
    MO is a screaming according to Junior. There, I saved you hundreds of dollars you would have had to pay in order to subscribe to his newsletter and hear it from him ;-)
    Jul 26 06:15 PM | 4 Likes Like |Link to Comment
  • A Cheap Internet Stock With High Dividend Yield [View article]
    Notbob,

    Don't pay attention to Junior ( who has used many other nicknames over the past 2 years).

    I there are so many other quality dividend authors to choose from here, which have graciously let seeking alpha republish their comments.

    As for whether MO is a good stock going forward, one should evaluate the future, not overly rely on the past. I would think that PM would do much better than MO, but who knows.
    Jul 26 06:11 PM | 1 Like Like |Link to Comment
  • Wal-Mart: A High Dividend Growth Stock [View article]
    David,

    I was just about to write the same thing about WMT being a high dividend growth stock. I really enjoy your site which has a complete listing of companies raising dividends for over 25 years. I was wondering if you have backtested the dividend champions list?

    I would be interested in seeing the results.

    BuffettJunior,

    No offense, but if you are a newsletter writer and you cannot make a difference between a high dividend growth and a high dividend stock, that doesn't speak well for you. Also why do you keep spamming seeking alpha about your supposed "financial independence", is another question I have. I remember when you tried to use dividend growth investor name on this site, and you were asked to change it, because users were outraged by you. My question is, why would a person who has reached financial independence spam message boards, websites, and impersonate others ( poorly) in an effort to promote a newsletter or sell the book " consume, consume more"?
    Jul 26 06:07 PM | 2 Likes Like |Link to Comment
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