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WinGreen

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  • Is Medical Properties Trust Growing Durable Dividends? [View article]
    Great article (as usual), but MPW still looks a little early in it's turn around for me, it is NOT a SWAN Reit "yet". Especially when you can get a dividend yield of about 5.75% from HCP, who continued to increase their dividends during the 2008-2009 period. For someone closing in on retirement, I want the safety/ security of a long established "sleep well at night" REIT, and that dividend cut back in 2008 is too close to home to be forgotten.
    Aug 3, 2015. 09:17 AM | 1 Like Like |Link to Comment
  • Rising Earnings - The Source Of Future Dividend Growth [View article]
    DGI,
    Another great article! I agree with what you are saying, a company in the "mature phase" of DG has to have it's EPS rise over the long run, in order to keep payng a rising dividend stream. Otherwise, the payout ratio will reach a point where the dividends have to come from borrowed money/ debt, selling off assets, or accounting "trickery". These other methods of "increasing cash flow" only work for so long, and then "BOOM", your investment blows up and you suffer a capital loss and or dividend cut.

    Many companies will have fluctuations in EPS growth on a year to year basis, but over the long run I want to see that number continue marching upwards. Companies can increase EPS in multiple ways- growth in revenues, cutting expenses, shrinking the amount of shares, or combinations of all three. One of the ways I "monitor" my DG investments is by tracking EPS. Revenue growth (ideally) will coincide with rising EPS, but NOT always. If a companies expenses rise faster than revenue growth, you won't see EPS increasing long term. Also, borrowing to pay dividends may work "for a while", but eventually you reach the point where EPS have to improve or your payouts become unsustainable. The large oil/ gas companies are excellent examples of that currently- they are cutting Capex (expenses), costs, and everything else, as well as raising cash via borrowing/ asset sales, in order to pay their dividends. This can go on "for a while", but eventually oil/ gas prices will have to recover in order for them to pay rising (or even their current) dividends. This is an economic "fact", you CANNOT earn a $1.00 and spend $1.10 forever. That is why I believe some of the "stronger" diversified oil/ gas producers (XOM, CVX, etc.) are becoming good "BUYS" at these prices. Oil prices will NOT be this low in 5-10 years, and when they recover these companies will be able to raise EPS.
    Aug 1, 2015. 11:10 AM | 1 Like Like |Link to Comment
  • WSJ: Amid oil sector's crumble, Exxon's edge may be M&A [View news story]
    I agree burann, XOM is a great buy now, as oil prices are NOT going to be this low "forever". And you're getting a good well covered dividend while you wait. I already have several thousand shares of XOM, otherwise I'd add more!
    Jul 31, 2015. 08:14 PM | 15 Likes Like |Link to Comment
  • Exxon Mobil misses by $0.11, beats on revenue [View news story]
    XOM is near the bottom! The can afford to cut capex now as there is plenty of "cheap crude oil" to buy (maybe even one of the "struggling" smaller players?), which they can then refine at a higher profit. They will do fine long term. We may be in for 2- 3 years of pain, but long term they'll see $100+ per share again. Unlike many oil/ gas producers, they make good margins on refining, which will provide a "cushion" to the drop in crude prices. And they can let some of the other players get close to bankruptcy, then purchase their assets "on the cheap". It really is "survival of the fittest", and XOM will survive and eventually thrive again.
    Jul 31, 2015. 10:39 AM | Likes Like |Link to Comment
  • Retired Dividend Growth Investors Are Lulled Into A False Sense Of Security [View article]
    George,
    I totally agree with your statements about recognizing when a company is in that "slow decline" like Windstream has been in for years, and selling out, "recognizing" the painful lesson, and preserving your capital (or what's left of it!).

    However, you replaced Windstream with some other pretty "high fliers" in terms of yields, especially GOV and PNNT. The question I have is whether these others may be different variations of the same (or similar) type of "sinking ship". All three are very high yielding, and I wonder whether you may again be "reaching" for yield. GOV and PNNT are both what I would consider "no moat" stocks, with no long term competitive adavntages, etc. I hope you have some other positions that are good long term DG positions, with strong moats, long histories of rising dividends (and revenues/ EPS/ etc.). Here are my "core holdings", stocks such as AMGN, APPL, ABBV/ABT, BLK, BBL, CL, CSCO, DUK, GE, HCP, INTC, JNJ, KO, LOW, MRK, MSFT, O, PAYX, PFE, PG, PM, SO, SCG, T, UN, UNP, UPS, USB, VOD, VZ, WMT, WBK, WFC, WPC, WY, and XOM. I know many of those are priced high right now, but a few are "priced" at relative discounts- BBL, XOM, WBK, WY, MRK, for example. These types of narrow or wide moat comapnaies should be the cornerstone of ones' DG portfolio, at least IMHO. Especially as one heads in to retirement- which will be within the next few years for me (age 56 & 3/4).

    I too have had more than my share of "painful" (but ultimately valuable) learning experiences in the market since I started investing in the early 1970's. But along the way, I've accumulated a very large portfolio (>5M), mainly by buying wide moat DG stocks (and aggresively saving), and then reinvesting dividends and allowing "time" in the market to work it's magic.
    Jul 28, 2015. 10:35 AM | 1 Like Like |Link to Comment
  • Selling Trash, Buying Trash [View article]
    Tim,
    South 32 may or may not be a good "value" proposition over the medium term (3- 5 years), and I actually sold it when it was spun off, as it didn't look like it was a "strong" or "moaty" business to hold. Over the years, deep value investing (at least for me) has been like catching "falling sharp knives". Sometimes I pull it, (APPL in March 2009), other times I have suffered the "painful" consequences.

    As the years have gone by, and my portfolio has grown to in excess of mid 7 figures, I have slowly come around to having my "investment style" that has worked extremely well for me. The question I have for you is this: Is "deep value" investing within your circle of competence? You are developing into an excellent DG investor, but South 32 definitely is NOT within that arena.
    Jul 26, 2015. 11:31 AM | 7 Likes Like |Link to Comment
  • Measuring The Success Of Your Dividend Portfolio [View article]
    Neurology,
    Being a dividend growth investor and a "total return" investor are NOT mutually exclusive! As an investor who has always looked at growing dividends as one "hallmark" of a potentially good investment, you can still choose good stocks with relatively "low" dividends, such as Visa, MasterCard, or Disney. The vast majority of the stocks I have bought over the years have tended to be DG stocks, however there are a few that I have bought that do NOT pay dividends at all- BRK.B for example, or AAPL in early March of 2009. AAPL is now paying me a solid dividend, but when we bought it it was more of a "turnaround" situation that appeared grossly undervalued. The stocks you mention are probably going to be good DG stocks, they are just relatively "early" in their DG life cycle, and do not have the long history of raising dividends. They also are relatively "over- valued" now, thus their dividend yields are low. Being a DG investor and a total return investor can be combined into one strategy.

    Many older investors naturally gravitate towards DG investing because of the predictability and stability of dividends, as ooposed to relying too much on capital gains which can be very "fickle". I myself have been investing since the early 70's, and it is interesting that the majority of my "best" investments over the years started out as solid relatively low yielding DG stocks, that have now matured into more traditional DG stocks (JNJ, CL, MSFT, BLK, MRK, AMGN, ABT/ ABBV, XOM, GE, INT, KO, LOW, MMM, O, PG, RDS.A, T, UL, WMT, etc.). In addition, as we have gotten older, we have added some of the higher yielding (but lower dividend growth) stocks such as DUK, VZ, SO, SCG, etc. You can combine the strategies, especially at your young age, and do quite well over the long run.
    Jul 5, 2015. 11:53 AM | 6 Likes Like |Link to Comment
  • Scanning The SA Family For Alpha: Rosenose [View article]
    Robyn,
    I agree with all your statements, with the exception of "disclosure" of their position in an investment (or not). I believe it is much better for an author to disclose their positions, or their intent to open a position, in any stock they are discussing. In fact, that is one of the things I look for in an article, if they DO NOT have a position, why should I even consider it?

    Obviously, if someone is prohibited from disclosing this information, that is a different story. But otherwise, they should put their money where their mouth is.
    Jul 3, 2015. 09:16 AM | 23 Likes Like |Link to Comment
  • W.P. Carey: A Classic Blue Chip REIT [View article]
    ProfEd,
    All REITs are being sold off due to fears of higher interest rates. Higher rates also can "hurt" REITs as borrowing costs will rise, which slows growth. But WPC is one of the "best of breed" REITs out there, IMHO. Long WPC, and hoping to add more!
    Jun 30, 2015. 07:18 PM | 4 Likes Like |Link to Comment
  • AT&T adds Richard Fisher to board [View news story]
    Talk about "golden parachutes"! Leaves his government job, gets appointed to two different corporate boards immediately, where he'll travel to their meetings 4 times/ year (on the shareholders dime), vote "yes" on whatever the company execs say, and get paid ~ 200K per company to do this "hard work". Not to mention the stock options that he will have to work "so hard" to get awarded.
    Bottom line is that executive/ board member pay has gone BEYOND THE OUTRAGEOUS point!
    Jun 26, 2015. 11:03 AM | 19 Likes Like |Link to Comment
  • Portfolio Reallocation: Sell CLR And Purchase XOM [View article]
    I also agree with several other commenters, smart move. XOM is definitely going to be a "smoother" ride, especially when you combine the dividend to your return. You really have fairly limited "downside" risk with XOM now. One thing rarely discussed here on SA is that XOM generates a LOT of profits from the refining/ processing side of the oil/ gas business. That is why they surprised Wall Street with their recent quarterly earnings beat. Because they are able to now purchase "cheap" crude from other suppliers, they can turn around and process it into all sorts of other products, and sell with significant profits. You may give up some potential "upside" capital gains, but definitely ensure higher likelihood of a decent total return over next 10+ years.
    Disclosure:Long XOM, it is the single largest holding we have.
    Jun 22, 2015. 11:16 AM | Likes Like |Link to Comment
  • Managing REIT Risk By Evaluating Credit Ratings [View article]
    Brad,
    Another great article. I also believe the true "benefits" of sticking with high quality REITs will become evident during the next financial downturn (or crisis), as opposed to the current market environment. Right now, as the markets generally trend slowly upward, "the rising tide lifts all boats". However, when the going gets tough and stormy, that is really when we'll see which REIT's are truly seaworthy versus which REIT's will sink in the first rough weather. I also agree with Bob Wells above, it may be real interesting to compare the perfomance (as well as dividend cuts) of the "high quality" or investment grade rated REITs to the "lower quality"/ below investment grade rating REITs during the finacial crisis. That is when the benefits of sticking with SWAN REITs will shine, as I "found out" with the financials during 2007-2009. My positions in BAC, Wachovia, and C did poorly, compared to WFC and USB, which are two SWAN banks I now hold.
    Jun 1, 2015. 09:01 AM | Likes Like |Link to Comment
  • Unveiling A Pivotal Plan For This Predictable Outlier [View article]
    Great writeup, as usual! Thanks! Have owned WPC since REIT conversion in 2012, great long term holding. Have it in my ROTH IRA, reinvesting dividends so that when I retire, will be able to get quarterly dividends tax free. WPC has shown all the attributes of a SWAN investment, comaparble to "O" or other top tier REITS. Definitely belongs on the "short list" of well run REITS to buy/ hold for the long run. My suspicion is the recent drop in price is people are "worried" about REITS in the face of coming interest rate increases (assuming they really come). I only wish I could put more in my ROTH to buy more!
    May 29, 2015. 07:39 AM | 4 Likes Like |Link to Comment
  • WP Glimcher's Honeymoon Turned Into A Bad Dream [View article]
    Brad,
    Great writeup as usual. However, this looks too "iffy" (in my humble opinion), and I question how they will hold up during the next inevitable downturn. Cash flow starts drying up, first thing to go will be that "juicy dividend". This is definitely not a wide or narrow moat company, so I'll just pass. Part of "winning" in investing is to avoid the real "losers", and I've got a feeling this one looks sort of like some of my past "losers"- BAC before the finacial crisis, etc.
    May 28, 2015. 08:43 AM | 1 Like Like |Link to Comment
  • 26 Income Securities For A Well-Rounded Asset Allocation [View article]
    I was "OK" with essentially all of your recommendations until I hit the part about the two bonds. Both are very long maturities- years 2052 and 2073- ie 37 and 58 years from now. Way too long, and IMHO are not good fixed income holdings for the average investor. Maybe for a life insurance company trying to meet obligations due those years, but way too much interets rate risk/ duration risk for the average investor!
    May 27, 2015. 11:06 PM | 11 Likes Like |Link to Comment
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