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depraved_miscreant

depraved_miscreant
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  • 9 Energy Utilities With Low Dividend Payout Ratios [View article]
    Just read '5 Dividend Stocks on Sale Now'. My favorite valuation metric is FCF Yield and, of the 5, only one looks like a buy on that basis: TEG, a utility of all things. TEG sports a FCF Yield of 17.3% for FY2010 and 13.5% TTM. Of note is that 2010 was the first year in a decade in which TEG showed positive FCF and it looks like 2011 will be a repeat of that. On the minus side, TEG doesn't qualify in my screen mentioned above, although the 3-year dividend CAGR is north of 10%. And its payout ratio is very high, maybe too high. Still, there's more than one way to evaluate a stock. I see FCF and I smell what may be value. It's time to investigate.
    Oct 31, 2011. 06:44 PM | Likes Like |Link to Comment
  • 9 Energy Utilities With Low Dividend Payout Ratios [View article]
    FWIW, I built a spreadsheet to screen utilities. I add the current yield to the lowest of the 3-, 5-, 7-, and 9-year dividend growth rates and look for those whose sum is greater than 10%. Besides a low payout ratio, I like to see at least 7 annual dividend increases in the last decade. Of the companies mentioned, EXC, NEE, NU and PPL qualify.

    I recently read (could have been here on SA) that NU gets a large percentage of its revenue from Connecticut, but that CT regulators are very unfriendly toward the utility. Any opinions, pro or con ?

    I am long PPL and the PPL-U and PPL-W equity units and am looking to diversify. I am looking at EXC, NU and AVA, as well as POR, although the latter lacks a 10-year history.
    Oct 31, 2011. 06:06 PM | Likes Like |Link to Comment
  • Here's What Mr. Market Says: 'Ban Dividends' [View article]
    Very clever, DVK. Ranks just behind your 'Periodic Table of Dividend Champions'.
    Oct 31, 2011. 03:54 PM | 1 Like Like |Link to Comment
  • Why Buy Annaly? [View article]
    Besides RS, I also look forward to yours, Dave.
    Oct 30, 2011. 11:55 AM | 2 Likes Like |Link to Comment
  • Why Buy Annaly? [View article]
    Agnew said it; William Safire was his speech writer at the time and wrote it. He was a political writer, but, to me, he was primarily a guardian of the language. No reason to buy the NY Times now that Safire is gone, plus my parrakeet died......
    Oct 30, 2011. 11:48 AM | 3 Likes Like |Link to Comment
  • Why Buy Annaly? [View article]
    You wrote "negative nabobs". Safire penned "nattering nabobs of negativism". Maybe you're no Safire (I really do miss his writing), but I keep reading your stuff anyway and manage to enjoy most of it.

    I be long NLY. Forgive the grammar, Bill.
    Oct 30, 2011. 08:35 AM | 2 Likes Like |Link to Comment
  • Exelon Is Ready To Take Off [View article]
    After re-reading what I wrote, you're right, RS. Good one. It is fuzzy writing. I hate when that happens.....

    I'm looking to add long positions in a utility or two. The sector has had a nice run lately, so there's time for additional DD (that's due diligence and, in the interest of clarity, has nothing whatsoever to do with DuPont).
    Oct 28, 2011. 05:19 PM | 1 Like Like |Link to Comment
  • Exelon Is Ready To Take Off [View article]
    Thanks for the info. I only own one utility (PPL) and I want to add another (or two) and EXC is on my short list.
    Oct 28, 2011. 07:58 AM | Likes Like |Link to Comment
  • Exelon Is Ready To Take Off [View article]
    In the interest of completeness, the author should have mentioned EXC's underfunded pension liability. I have seen it estimated @ $5.8B or @24% of total liabilities. Opinions on this are mixed: some consider it manageable, others do not. I consider it a large enough issue to at least be mentioned in any serious opinion piece. BTW, I have no position in EXC, so I'm not certain about the exact numbers.
    Oct 25, 2011. 08:21 PM | Likes Like |Link to Comment
  • 3 Potential Multi-Baggers For Long-Term Investors [View article]
    The debt is indeed in the billions and is due to large acquisitions. But it's there and the debt number is a far cry from the $18M total debt the author cites for BIP. Another SA author not to trust.
    Oct 22, 2011. 01:21 PM | Likes Like |Link to Comment
  • Loans: Currently The Most Viable Choice For Long-Term Fixed-Income Investors [View article]
    Thanks. BTW, what ING calls Weighted Average Reset, Eaton Vance calls Average Duration.
    Oct 22, 2011. 08:42 AM | Likes Like |Link to Comment
  • Loans: Currently The Most Viable Choice For Long-Term Fixed-Income Investors [View article]
    Steven, now that I have everything sorted out (I think), I agree that these funds might be perfect income investments for this environment. Interest rates should hold steady for a while, although they could decline a bit more in an economic slowdown. But when rates rise, if the loans are reset in terms of months, the income stream of the funds should rise with little lag. And since they are senior, they probably beat some floating rate preferreds. And, the larger funds I have looked at hold hundreds of these securities, also lessening the impact of any defaults and making it easier for me to live with the generally lower credit quality.

    Again, good article. Thanks....
    Oct 21, 2011. 09:51 PM | Likes Like |Link to Comment
  • Loans: Currently The Most Viable Choice For Long-Term Fixed-Income Investors [View article]
    I think Bryce threw me with "at least 80% of their assets in floating rate securities", not floating rate loans. If multiple lenders participate in the loan, they would, of course, create securities, which are the assets the funds hold; the fund is not the lender. Also, I had read an article (in Forbes, I think), which may or may not have stated that the duration of these loans was in months, not years. At least that's what I remembered, perhaps incorrectly. The article probably referred to the reset frequency, not the maturity.

    As for the use of leverage, that made more sense after a couple of Jameson's. In the case of PPR, the fund issued a preferred and took on one other form of debt.

    I still would be interested in knowing a source for finding the Weighted Average Reset for these funds. Any help is appreciated.
    Oct 21, 2011. 09:42 PM | Likes Like |Link to Comment
  • Loans: Currently The Most Viable Choice For Long-Term Fixed-Income Investors [View article]
    Bryce I don't follow. On CEF Connect, I see an average maturity listed, but not Reset. Also, you say 80% of assets are in floaters. Yet CEF Connect's portfolio allocation shows almost all assets in loans. I also don't understand their leverage description.

    Could you clarify or recommend another source for fund specifics?
    Thanks...d_m
    Oct 21, 2011. 05:26 PM | Likes Like |Link to Comment
  • 3 Potential Multi-Baggers For Long-Term Investors [View article]
    I looked at BIP's balance sheet from 3 different sources (AdvFN, MSN, and Morningstar). While the numbers all differ, they all show an explosive growth of LT debt (in the billions). Explanation ? Disagreement ?
    Oct 21, 2011. 05:12 PM | Likes Like |Link to Comment
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