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cpa28761

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  • Yield Face-Off: Blue Chip Equities vs. Same Company Blue Chip Bonds [View article]
    >>>An example is EXG. A 9.5% discount<<<

    Eaton Vance Tax-Managed Global Diversified Equity Income Fund trades at a 9.5% discount and has no leverage. Its largest holding is RDSB, which I happen to hold as well. RDSB yields about 5%. VOD, its second largest yields about 5% as well. Apple, its fifth largest, does not pay a dividend at all. So, by what alchemy does this fund yield more than 10% in the face of a management fee and find expenses?

    It is not alchemy at all. It is just how one calculates yield. If it is calculated by portfolio income only, the fund yields 1.68%. However, if we include returns of capital (paying shareholders with their own money by selling securities), its distribution yield is over 12%.

    www.closed-endfunds.co...
    Jun 23 02:03 PM | 1 Like Like |Link to Comment
  • Yield Face-Off: Blue Chip Equities vs. Same Company Blue Chip Bonds [View article]
    poortorich, I'm not sure I would characterize Todd's investment style as "defensive". If he is buying CEF's that yield 10% and are at 10% less than NAV, he is investing in leveraged funds that invest in lower quality securities. That is playing with fire. That introduces a whole new dimension of risk other than default that he does not address. Give me a dividend paying blue chip stock any time for a warm fuzzy feeling.
    Jun 23 10:26 AM | 1 Like Like |Link to Comment
  • Yield Face-Off: Blue Chip Equities vs. Same Company Blue Chip Bonds [View article]
    In today's interest rate environment, never buying bonds over par, restricts an investor to a small minority of bonds available in the market. Hopefully, the source from which an investor buys bonds will provide yields to worst case, which may be call.

    Armed with "yield to worst" and any other relevant information, there is nothing wrong with paying a premium. As a matter of fact, if a bond with a good coupon is selling below par today, I would wonder where the "gotcha" is.
    Jun 23 08:23 AM | 2 Likes Like |Link to Comment
  • 10 Premier Stocks Yielding Over 3%, Worthy of a Place in Your Portfolio or Watchlist [View article]
    Gee, I own only seven of them.
    Jun 23 08:10 AM | Likes Like |Link to Comment
  • 20 High Dividend Stocks With Sustainable Payments [View article]
    In looking at LLY and BMY (and any other pure-play pharmaceutical), I would be very cautious regarding patent expirations of key drugs.
    Jun 22 08:57 PM | 1 Like Like |Link to Comment
  • Waste Management Looks Undervalued, Boasts Attractive Yield [View article]
    Brian:

    You may be right. S&P has a buy on WM. Merrill includes it in their Income Portfolio. However, I think there are enough investment choices where management can point to past results to substantiate a continuing trend as opposed to factors that will make next year better than the previous five.
    Jun 22 05:04 PM | Likes Like |Link to Comment
  • Waste Management Looks Undervalued, Boasts Attractive Yield [View article]
    golden, you raise an excellent point. For the past five years, WM's EPS, revenue, and cash flow growth has been stagnant to negative. Their capital spending growth has been negative as well. Their payout ratio is over 64%.

    It's hard to buy into DCF's based on double-digit earnings growth.
    Jun 22 12:49 PM | 2 Likes Like |Link to Comment
  • The World's Largest Apparel Company Has an Impressive 5 Year Plan for Growth [View article]
    Has anyone considered vulnerability to private labels?
    Jun 21 03:24 PM | Likes Like |Link to Comment
  • Desperately Seeking Yield Through Equities: Part 4 - Telecom Stocks [View article]
    Thanks for the response. My largest holdings are consumer staples (22%) and health care (16%). Telecom represents only 5% of my portfolio.

    My Fidelity source shows BCE with a yield of 5.6%, which I consider equal to T (5.59%) and VZ (5.49%). The same table shows FTR yielding 9.53%. A payout ratio in excess of 300% in the face of a 25% cut from the previous year's level does not look encouraging. CTL is shown at a 7.35% yield and a 97% payout ratio, which I do not find encouraging either.

    I have to admit that VOD looks interesting with a yield of 7.57% and a payout of 54%. I am troubled by that analysts, with good track records in telecommunications, rate VOD as underperform. You have given me food for thought.
    Jun 20 08:46 AM | 1 Like Like |Link to Comment
  • 10 Premier Stocks Yielding Over 3%, Worthy of a Place in Your Portfolio or Watchlist [View article]
    Arthur, you are quite correct. I hold two tissue companies: PG and KMB. I have a much greater position in PG, but I hold KMB to improve my overall current yield. KMB's yield (4.23%) is superior to that of PG (3.25%), but PG has a lower payout ratio, better growth projections, higher margins, and a stronger balance sheet. PG has a better dividend growth rate and should be able to continue to increase its dividend at a faster clip than KMB. This will translate into a superior total return for PG and a higher yield on cost in a few years.

    So, why do I hold PG competitors KMB and CL? I may be wrong. I believe in a market basket portfolio.
    Jun 19 08:42 PM | 5 Likes Like |Link to Comment
  • Desperately Seeking Yield Through Equities: Part 4 - Telecom Stocks [View article]
    Why not BCE? I hold it for its yield and for diversification away from the US Dollar.

    Long: BCE, T
    Jun 19 08:17 PM | 1 Like Like |Link to Comment
  • Intel: An Ideal Value Investment [View article]
    >>>Intel is very stable, trading at 3.2 times its book value. This is slightly higher than the industry average. However, if you compare the company to AMD - its largest competitor - you will see that Intel has room to run (AMD's book value is at 4 times its current price).<<<

    Aren't investors buying intellectual property, especially when we address technology? What is the relevance of book value? The market looks to the stream of income that INTC and every other company can produce. In this perception, the market finds INTC coming up short. The cost basis of their machinery and intangibles has little to no bearing on INTC's market value.
    Jun 19 09:29 AM | 1 Like Like |Link to Comment
  • 20 Low Price to Book Value, Competitive Advantage Stocks [View article]
    Hedgephone:
    I couldn't agree more with the first few paragraphs of this article. In the 90's, I did not want to get into tech stocks. I felt that no matter what the innovation, in a matter of months someone else would find something better and cheaper. I allowed others to influence me. It looked so easy. There was a "new economy" after all. It was all a myth and wishful thinking. I got burned like most people, although I did sell CSCO when it was selling for 200X earnings.

    Where we disagree is that I do not believe book value has any relevance as a measure of an investment. Regardless of the company, we are investing in management's capacity to innovate. Whether we look at technology, consumer staples, aerospace and defense, chemicals, pharmaceuticals and health care, or diversified manufacturing, the intellectual capacity of management means far more than the buildings, machinery and equipment on the balance sheet.
    Jun 18 03:39 PM | Likes Like |Link to Comment
  • 5 Stocks Billionaire Carl Icahn Loves [View article]
    tweedn:

    Amen to your conclusion. However my source (Fidelity) shows the TTM payout at over 100%. I can't imagine why, with choices and competitors such as PG, CL, PEP, KO, K, KMB, and GIS, would invest in CLX.
    Jun 17 11:08 PM | 1 Like Like |Link to Comment
  • 6 Premium Dividend Payers to Buy on Dips or Drops [View article]
    Gunny and Robert:

    If an investor must have 4% on a consumer staple, go with KMB. They are like a utility. They came up with one innovation in 1918 (Gunny, you had it on your utility belt), nurses adopted it, it was adapted for other personal care uses, and in 7 years it will be one hundred years old. They are the best one-trick-pony in history.

    Long: KMB
    Jun 17 04:20 PM | 4 Likes Like |Link to Comment
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