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  • 19 Large Cap Dividend Stocks At A Deep Discount [View article]
    How do you see the market for postage meters in the 21st century? Have you heard of the Post Office contemplating lay off's and discontinuing Saturday delivery? Do businesses you know use EDI and email? Do you pay your bills by writing checks?
    Aug 28, 2011. 11:15 PM | Likes Like |Link to Comment
  • 5 Buy and Hold Forever Dividend Stocks [View article]
    I would agree with you if I could tell the dips from the crashes. I really don't think everyone knew that 2008 was a crash, rather than a correction or a dip. Even today, I don't think people really know if the market decline triggered by the S&P downgrade of USA debt was a dip or correction, or the start of something far worse.
    Aug 28, 2011. 04:17 PM | 1 Like Like |Link to Comment
  • 5 Dividend Stocks Building Future Yield [View article]
    Giovanni, you are absolutely right. There is no single metric worthy of dictating investment decisions. If HFC was yielding less than 1%, a 16.7% increase still makes their dividend meaningless. Increases in dividends cannot be greater than increases in profits and be sustainable over any long-term period. A balance sheet must be strong to support dividends if there are bumps in the road. Finally, the business model must make sense going forward.
    Aug 28, 2011. 03:21 PM | 1 Like Like |Link to Comment
  • 13 Dividend Stocks With A Quick Payback [View article]
    >>>Payback period is probably the most commonly used measure of value in the business world.<<<

    Are there any published statistics behind that statement? I spent half of my career with three Fortune-500 companies and IRR was the criterion. If you use payback you will always have a bias toward projects of shorter duration.

    >>>No one knows what any corporation will earn over the next year, 5 years or 20 years. These variables, DGR, forward P/E, PEG, while based on historical evidence are in the end just someone's idea of what's going to happen in the future. <<<

    Investment decisions of any magnitude are based on assumptions. Otherwise, no investment would be made in anything more complex than cost savings (i.e.,replacing electric motors). The value of any stock is the market's collective perception of its future earning power. The variables may change day-by-day, but they're there and that's the way it is.
    Aug 28, 2011. 12:48 PM | 2 Likes Like |Link to Comment
  • 5 Already Cheap Stocks Now Selling At Deep Discounts [View article]
    JNJ is the only one mentioned that I would own today. They are a model of diversification and consistency. GE, which I might consider, is recovering from the Jack Welch over-diversification, and is getting back to its roots as a manufacturing company. INTC and CSCO have gone from creators of proprietary products to creators of commodity products. PFE had the greatest drug in history, but in three months that drug will be a commodity too.

    Long: JNJ
    Aug 28, 2011. 12:31 PM | Likes Like |Link to Comment
  • 5 Buy and Hold Forever Dividend Stocks [View article]
    And of course you will always know where and when the tops and bottoms are.
    Aug 28, 2011. 11:49 AM | 2 Likes Like |Link to Comment
  • 10 Reasons to Buy Teva Pharmaceuticals [View article]
    My response, posted on Barrons:

    >>>The flaw here is in not viewing Teva's business model in a broader context. Teva is in the business of selling commodity products to dominant retailers who buy on price alone. There is no way to make serious money in that milieu. There is no way to achieve any proprietary strength or exclusivity. Teva's best-of-breed status makes them the best house in a bad neighborhood.<<<
    Aug 26, 2011. 09:04 AM | Likes Like |Link to Comment
  • 13 Dividend Stocks With A Quick Payback [View article]
    To assume a sustained 15% dividend growth rate, are you not implying that earnings will grow at a 15% compound annual growth rate? That's a pretty tall assumption if so. The only factor mitigating that may be a company changing its policy from distributing, say, 25% of its earnings to one of distributing, say, 75% of its earnings. However, that would be a pretty tall assumption too.

    BTW, I took my first finance course around 1966. Back then we learned that the "pay back" method of evaluating investments was obsolete. Has anything changed?
    Aug 26, 2011. 08:33 AM | 2 Likes Like |Link to Comment
  • Johnson & Johnson: Using Common Stock To Turn $25,000 Into $1 Million [View article]
    I'm not sure I agree on SJM. No, I don't agree. SJM is a repository for a) Brands PG developed and gave up on due to lack of growth potential and b) brands that GIS was enjoined from keeping when it acquired its rival, Pillsbury. I prefer to go with the leaders.

    Any positives showing in SJM's numbers relate to their acquisitions and not from their organic growth.

    Long: GIS, PG
    Aug 23, 2011. 04:08 PM | 2 Likes Like |Link to Comment
  • 30 'Overdue' Dividend Increases -- Will History Repeat Itself? [View article]
    >>>True, you get earnings from it. But unless you are actually collecting the cash from these sales your company won't make it too far.<<<

    You are correct, which is why, whenever I arrived at a new company, the first thing I did was to see that the company was properly reserving for customer deductions. However, since I was involved in the preparation of financial statements and financial planning the following comes intuitively to me. If proper provisions are NOT made for future deductions, both the P&L and the Cash Flow Statement will be misstated by the exact same amounts. Therefore, perhaps you are the one failing to recognize the connection between the two statements as well as that you are the one who is pedantically clinging to one single metric as the be all and end all sine qua non measurement.
    Aug 23, 2011. 01:09 PM | 2 Likes Like |Link to Comment
  • 30 'Overdue' Dividend Increases -- Will History Repeat Itself? [View article]
    >>>YOU are the one who made the comparison to PBI<<<

    Yes, I did, to demonstrate that FCF may not tell all one needs to know about an investment and the value of its dividends. I hope that when you read a statement of cash flows, you read all three sections. A business may also have plenty of FCF that will be needed for financial obligations.
    Aug 23, 2011. 12:17 PM | 2 Likes Like |Link to Comment
  • 30 'Overdue' Dividend Increases -- Will History Repeat Itself? [View article]
    >>>Before making attacks on my explanation of cash vs. earnings, I think you should pick up a book on accrual vs. cash accounting and read it.<<<

    Sorry, Tim. In 1971, the State of New York deemed me qualified to put the letters CPA after my name. I spent over forty years in accounting and finance, the majority as a Controller or a Financial VP. I'll go with David's explanation and understanding in both theory and practice.
    Aug 23, 2011. 11:59 AM | 2 Likes Like |Link to Comment
  • 30 'Overdue' Dividend Increases -- Will History Repeat Itself? [View article]
    I really think you would benefit from a course in analysis of financial statements or even basic accounting. Cash is a measurement at an instant in time. Earnings are the results of operations over a period of time. By selling stuff for more than it costs to make it and run the company comes earnings. That is from where the cash to pay dividends comes.

    Your comparison of REIT's to PBI (a manufacturing company) is apples and oranges. There are different metrics involved in special entities such as REIT's and MLP's.

    If a business needs cash there are only two ways to get it. Earn it or borrow it. Earnings and borrowings are independent variables. Cash balances at the end of the day are dependent of the other two.
    Aug 23, 2011. 11:40 AM | 3 Likes Like |Link to Comment
  • 5 Undervalued Stocks That Pay Steady Dividends [View article]
    CL has a better margin the PG, because its product mix is geared more toward personal care and less toward household products. I don't know if that is necessarily a good thing given that PG ran CL out of the laundry detergent business. I don't know if that makes CL more defensive than PG given that PG's yield is higher than CL's.

    I would not discuss CLX in the same paragraph as CL and PG.

    Long: CL and PG
    Aug 23, 2011. 11:25 AM | Likes Like |Link to Comment
  • 9 Dividend Stocks Providing Positive Feedback [View article]
    >>>If Bethlehem were properly managed ie to the enefit of the owners they would have recognized their disadvantge and driven company toward new locations and technology much like Nucor.<<<

    Hindsight is 20/20. You could say the same of every other American Steel company. However, there is no way that the mass of them could compete with MT in terms of producing tonnage in a competitive world market. Thank you, Steel Worker's Union.

    >>>I did not claim PBI would be successful but one strategy is to get Oracle, ADP or whoever to recognize value in their niche if any and sell them the company. <<<

    What is their niche and to whom would it be of what value? I worked for a major printer of direct mail marketing materials about ten years ago that was in a downward spiral that has not ceased. On a personal level, I use about one postage stamp per month. We live in a world of EDI, EFT, the internet, and email. PBI is mired in the last century. They have no durable competitive advantage in this digital age. They are no better equipped to compete in this arena than KO.
    Aug 23, 2011. 11:12 AM | 2 Likes Like |Link to Comment