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WinGreen

WinGreen
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  • Philip Morris International's Path Out Of Dividend Trouble [View article]
    Remember that currency "headwinds" will eventually become "tailwinds", when the dollar peaks and then starts to decline. Currencies tend to go through a "boom or bust" cycle, and over the longer term (10 years plus) this may be "a wash". The dollar is currently strong, due to our central bank being close to tightening monetary policy, versus the Euro/ asian currencies being very weak as their central banks "loosen" monetary policy. In 1-4 years, the other currencies will be turning the corner and probably rising, and the dollar falling against them, and PM's earnings will get a "boost" when translated back to dollars (from Euros, rubles, yen, or whatever). I agree, PM is probably "cheap" right now for a good "short term" reason, but if you're a long term investor, now is a good time to build up a position.
    Apr 14, 2015. 10:01 AM | 1 Like Like |Link to Comment
  • My Strategy For Objective, Emotionless Dividend Growth Investing, Part 3 [View article]
    As a long term dividend growth investor, who started in 1972 with my first dividend growth stocks (Burlington Northern Railroad- now Berkshire Hathaway), it does make A LOT of sense to try to pick out the relatively "low yield" DG stocks. Then you hang on to them as they continue having that fast dividend growth and evolve into more "mature" companies. Some of my original holdings (JNJ, WMT, CL, ABBV, ABT, PG, MO/ PM, UPS, etc.) started out only yielding around 1-2.5%. But because they all have "wide" economic moats/ sustainable long term business models, they have all grown to be quite large DG stocks. My yield on cost for my Colgate is 56%, JNJ it is 27%, and my XOM yield on cost is over 100%! These were all bought decades ago, and have a cost basis of only a few dollars a share. Hence, I will most likely never sell them, and pass them on to my children/ charities, etc. That is the essence of dividend growth investing. Along the way, there have been more than a few "bombs" that I bought, that I later sold at losses, sometimes painful losses. The key is patience, as well as NOT over-paying for the growth. When the P/E is much higher than 20, beware!

    Right now, many DG stocks are priced pretty high, and therefore I would be very careful about over paying for "growth". I have been able to slowly accumulate a large portfolio (>4 million now) mainly by buying "quality" companies, and then hanging on to them and letting time (and compound interest!) work their "magic". Like Warren Buffett said, the best holding period is "forever", as long as it is a great company.
    Apr 13, 2015. 08:40 PM | 1 Like Like |Link to Comment
  • A Single Mother's Income - Dividend Growth Investing [View article]
    Dividend Diva,
    Loved your article, and also liked your overall approach to investing. I have a few thoughts/ suggestions to at least consider. First, although I think GE is turning around as a company (I also have GE in my portfolio), I would be very careful about allowing ANY single stock position to become more than 10% of your entire portfolio. You are just taking too much "single company" risk when you do that. At least STOP reinvesting the GE dividends, and consider "steering" them into other DG or high yield stocks. Secondly, consider looking to Dividend "contenders", those that have raised their dividends a minimum of 10 years, in addition to the dividend champions. I require ALL my potential holdings to have AT LEAST a "narrow" economic moat (prefer a wide moat) and 10 years minimum of dividend growth. Lastly, good luck, I also appreciate your personal story as my mom was a single mom, high school librarian, and growing up "struggling" financially was part of what "lit the fire" in my belly to become financially independent. Fortunately, I can say I am now "there", with a DG portfolio of 4 million at age 56. Keep it up!
    Apr 9, 2015. 02:47 PM | 1 Like Like |Link to Comment
  • Dividend Growth Portfolio - Spring Checkup And Semi-Annual Review [View article]
    Buyandhold2012,
    I follow your thoughts, and traditionally I have been reluctant to sell a long term "winner", especially when it continues to raise it's dividend each year, and perfoms well. However, our portfolio eventually got to the point that XOM was about 16-17% of the total portfolio several years ago, and part of that was because my wife inherited some XOM from her grandfather, on top of an already large XOM position. I became a little "nervous" about the additional "single stock" risk we had, and did a lot of research into various outcomes. Basically if you have one stock position that is larger than 10%, studies show you are taking an inordinate amount of "single stock risk" that you generally are NOT adequately compensated for (B. Bernstein has written quite a lot on this). So we have gradually sold & donated it down to < 10%, and I would suggest you think carefully about doing the same. Even the best companies in the world can have something "unique" happen to them, that could jeopardize your portfolio. Think about someone who had a huge chunk in Enron, Worldcom, etc.
    Apr 7, 2015. 10:04 PM | 6 Likes Like |Link to Comment
  • 4 Companies Showing Confidence With Increased Dividends [View article]
    Dividends4Life,
    I enjoy reading your articles, but I wonder why you do NOT have a position in any of these 4 stocks. In other words, why don't you "eat your own cooking"??? Thanks!
    Apr 3, 2015. 08:54 AM | 1 Like Like |Link to Comment
  • Philip Morris: A Dividend Cut Is Possible [View article]
    Good article, and if the dollar continues to rise, PM's payout ratio will get very high and "on paper" it's dividend could be "at risk". However, the company seems to want to protect the dividend, even at the expense of buybacks, and possible increased borrowing.
    One thing NOBODY has really mentioned is that the dollars' rise acts like a "coiled spring" longer term, once the European and Asian economies start turning around, the dollar will peak and start falling, and that will boost EPS, as well as drop the payout ratio. Long term, the currency effects should "balance out". My interest in PM is whether they will pay a higher dividend in 5-10 years or more. I'm betting they will. This is a short to intermediate effect. By the way, same issues affect multiple other "blue chip" dividend growth stocks- KO, JNJ, etc. Anybody who has a big portion of their sales overseas.
    Apr 1, 2015. 09:09 AM | 2 Likes Like |Link to Comment
  • Total compensation for UPS CEO doubles in 2014 [View news story]
    Absolutely ridiculous! Talk about pay for "non- performance", we're now paying CEO's millions to under perform the market.
    Mar 24, 2015. 10:37 AM | 2 Likes Like |Link to Comment
  • Construction Delayed, Bringing Down Southern Company's Rating From Buy To Hold [View article]
    I suspect it was 4.4 billion.
    Mar 6, 2015. 05:34 PM | Likes Like |Link to Comment
  • Getting Past Google's High P/E Ratio [View article]
    Too expensive for my tastes! Assuming the growth rate continues, it still is "richly valued". No dividend, and no real plans to pay one? I'll pass. but if it corrects to P/E <20, then I'm interested.
    Mar 6, 2015. 05:24 PM | 2 Likes Like |Link to Comment
  • AbbVie says three firms were bidding for PCYC in a very competitive process [View news story]
    Go ahead and short it, at your own risk!
    Mar 5, 2015. 10:44 AM | 6 Likes Like |Link to Comment
  • Flying High With RLJ Lodging's Immutable Dividend Record [View article]
    Brad,
    Another great write up about a REIT that definitiely looks "interesting". My one question is more about REITS in general. If the Federal Reserve starts raising interest rates this year, won't REITS (as a group) be "taking it on the chin"? Is it better to wait for a better entry point after they come down?
    Mar 3, 2015. 10:56 AM | Likes Like |Link to Comment
  • One More Risk For Vodafone Longs: An M-Score Of -.28 [View article]
    So if AT&T has an M score of -2.83, why not call it a "manipulator" too. Vodaphone's M score is -.284, sounds like T is in the same category as VOD. Run the numbers on Verizon too. Is it something "unique" to the Telecom area. This doesn't make any sense to me, you call VOD out as a "possible earnings manipulator", yet T has a nearly identical M score.
    Feb 26, 2015. 09:00 AM | 3 Likes Like |Link to Comment
  • BlackRock: Another Future Dividend Aristocrat [View article]
    Well written article about a good dividend growth company! Bought BLK in 2010 and added to position 2011, and since then has continued to grow/ raise their dividend. I agree, it could become a future dividend aristocrat. Long BLK.
    Feb 21, 2015. 10:55 AM | Likes Like |Link to Comment
  • Retirement Strategy: Is It Time To Panic Based Upon The Most Widely Used Valuation Metric? [View article]
    Just the truth,
    I agree with what the others are saying, you need to really think through your reasons for the initial purchase. Even better is to develop an investment "statement" or plan, that lays the groundwork for your buys/ sells, as well as your overall portfolio.
    I have evolved into a "buy and hold" classic dividend growth investor over time, and have found that many times when I have sold a company because it (usually temporarilly) "spiked up" in price, I have come to regret it. Often, I have sat there for several years and watched it continue to slowly grow ever higher,"kicking" myself for ever selling it in the first place. I will VERY RARELY sell a company now, and if I do it is usually for one of several reasons:
    1.) Cuts the dividend
    2.) Failed to raise the dividend for "several" years, and it's longer term growth makes me worry it cannot support the dividend or raise it in the future. If the payout ratio continues to rise, earnings are flat (or falling), etc., then I will pull the trigger and sell.
    3.) Fundamental "change" in it's competitive postion, it's "moat". I typically buy companies that have long term competitive advantages, ie a "moat". If the moat falls apart, I will consider selling.
    Otherwise, when I buy a company, I plan on holding it "forever" (as Warren Buffett says) and passing it on to my children/ grandchildren. Some of the original purchases I made in the late 1970's are still in my accounts, and several positions are now worth WELL OVER 100,000 each (XOM, BRK.B, JNJ, MRK, WMT, etc.).My total account is now over $3,900,000, and it grew to that size VERY SLOWLY. Mainly by buying/ holding classic dividend growth stocks, especially when they go "on sale" every 5-10 years (like 2008-2009!) and then reinvesting dividends and every penny I could save. Becoming wealthy is a slow process, and I am slow/cautious about buying, and even MORE cautious about selling a "winner".
    Feb 16, 2015. 05:45 PM | 8 Likes Like |Link to Comment
  • Barron's: Whether crude moves up or down, best to avoid big oils [View news story]
    IMHO, this is about as solid a prediction that oil is closer to a bottom as one can get! When Barron's say it will fall further, I would suggest backing the truck up and buying.
    Oil prices have come down hard because of all the "new oil/ gas" from the fracking boom in the US. One thing rarely mentioned is that fracking results in a fairly short term "boost" in production, compared to traditional well drilling. Some of these wells are going to have their production fall off tremendously after 3-5 years. The peak of U.S. fracking production is probably 2016-2018, so the "extra" oil/ gas from fracking will start declining after that. My suspicion is that we will see oil well above $100 barrel well before 2020. Also, people fail to realize that the majors (XOM, COP, RDS.A, CVX, etc.) make more money from their refining when oil prices DROP, as their spread between purchased crude oil vs. selling refined oil is higher.
    Hence, I am hanging on to all my XOM (10% portfolio) and may add a little more RDS.A, COP, to my portfolio. Their dividends are still covered, and they are going to be much higher over the next 5 years than they are now. So if you are a long term "investor" (as opposed to a speculator) now is probably a good time to buy.
    Feb 14, 2015. 11:59 AM | 4 Likes Like |Link to Comment
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