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woodworker

woodworker
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  • No Dividend Conspiracy At Wal-Mart; Its Growth Has Simply Stalled [View article]
    I make very few stock trades. Probably not more than 2-4 trades a year. However, I am considering selling half of my WMT position. I paid an average of $54.23 per share. I started buying in 2010 and finished filling the position 12 months later.

    The low dividend increases irritate me but the do not keep me awake at night. It is the low dividend increases combined with: Poor service, poorly stocked shelves, dirty and messy stores, quality of products going down, frequently they are no longer the lowest price, and management's unwillingness to take care of the basics.

    Not proactively addressing fundamental issues combined with decreasing earnings sounds like a good combination to increase the chances of failure.
    I am a big believer of walking into a business and looking arround before I buy any of it. What you see during those walk arrounds is my version of the canary in the mine.
    Comments would be appreciated
    Feb 24, 2015. 09:08 AM | 1 Like Like |Link to Comment
  • AT&T And 'Losing' To Inflation [View article]
    A couple of years ago I cut my T exposure by 50%.
    I work on the theory that dividend growth has to be funded by growth in sales and revenue.
    Cost cutting is a one time event only and does not contribute to growth.
    If a company can not grow their dividend at a reasonable rate then it implies that sales and revenue are not growing.
    Another word for it would be stagnation.
    Without growth you investment looses value.
    Look at the statistics below (taken from Fastgraphs):

    End Fyr
    or Fqtr** Dividend Growth% Div. Payout Ratio
    12/01/95 4%  53.00%
    12/01/96 4%  49.00%
    12/01/97 4%   75.00%
    12/01/98 4% 42.00%
    12/01/99 4% 45.00%
    12/01/00 4% 45.00%
    12/01/01 1%  44.00%
    12/01/02 5% 48.00%
    12/01/03 7% 79.00%
    12/01/04 9% 86.00%
    12/01/05 3% 76.00%
    12/01/06 4% 58.00%
    12/01/07 9% 53.00%
    12/01/08 10% 57.00%
    12/01/09 2% 78.00%
    12/01/10 2% 74.00%
    12/01/11 2% 79.00%
    12/01/12 2% 77.00%
    12/01/13 2% 72.00%

    Look at the entries starting in 2009. A significant reduction in dividend increases with a significant increase in payout ratio. If it was only 2 or three years I wouldn't worry about it However, the 2014 increase has been no better. According to the Scottrade website the payout ratio has improved to 55%. However, I would like to see if the FastGraphs number comes in close to that.
    It is the recent 5 year trend of sharply reduced increases in the dividend and a very sharp increase in the payout ratio that makes me reluctant to have anymore AT&T stock.
    Dec 28, 2014. 08:05 AM | Likes Like |Link to Comment
  • Recent Buy: General Electric [View article]
    3 years ago (Dec 2011). I bought some shares of GE at $16.64 a share.
    If you include the dividends, I have made a 68.69% return on the stock. GE comprises .74% of the portfolio.

    They were my one speculative buy. The reason I say speculative is because they did decimate their dividend during the recession. That tells me if they did once, the second time it will be easier for them to reduce the dividend.
    Every other stock in the portfolio continued to raise their dividends during the recession.

    I take the "Growth" part in DGI very seriously.
    Dec 24, 2014. 10:54 AM | Likes Like |Link to Comment
  • Coca-Cola Has Got Milk, And Investors Should Care [View article]
    It is too early to tell how it will do. Years ago could you imagine walking down the street and Paying $3.00 - $4.00 for a cup of coffee at a place like Starbucks instead of $.50 at McDonalds?
    Dec 23, 2014. 11:43 AM | 3 Likes Like |Link to Comment
  • The Decline Of McDonald's [View article]
    First of all, this article is full of a lot of generalities and extremely lite on specifics. McDonalds has more healthy food available than any other fast food outlet. Right now it is a fad to slam McDonalds, This will pass with time. Also, a lot of this could be fixed by:
    - Change the marketing message to emphasize the healthy options
    - Clean up the restaurants and the employees.
    Simplifying the menu is a good start in opinion,
    I used to get my breakfast at McDonalds a couple of times a week, However, the lines in our area are too damned long. I just have some yogurt at home.

    I have one advantage over a lot of the readers. I have eaten at McDonalds restaurants in 5 different countries other than the United States.
    Try getting a Big Mac at the Marble Arch McDonalds in London. The lines are massive. The one in Rome wasn't doing too bad for lines. However, we were usually very early and just doing a drive through for some breakfast that we would eat on the drive to Naples.

    BTW I am long on MCD and I plan on keeping it.
    Dec 19, 2014. 08:56 AM | 4 Likes Like |Link to Comment
  • Don't Buy Exxon Mobil [View article]
    After reading this article 3 thoughts come to mind. They are:
    - This article has a lack of historical perspective. The downturn is just a minor blip on the calendar for a company like XOM

    - Something that Buffet is credited with saying.
    “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful”

    - I wish I had cash to buy some XOM right now. However, I am fully invested and I don't have any positions I am willing to sell.

    Fossil fuels are going to be around for a long time. Renewable energy technology that has any practical use is at the same stage as a newborn. I believe it will become more prevalent, but it is going to take at least 20 years or longer.
    Dec 12, 2014. 09:20 AM | 5 Likes Like |Link to Comment
  • ExxonMobil: The Safest Way To Play The Oil Rebound? [View article]
    How does KMI fit in with the others. They are a pipeline company not a producer.
    Dec 12, 2014. 08:42 AM | 1 Like Like |Link to Comment
  • Independent Thinking For Successful Dividend Investing [View article]
    I have been doing my own investments for 4-1/2 years. Your article ties in directly to what has been working for me.

    My biggest investment mistake was not firing the stock brokers years earlier.

    When people ask me about how I do it, I tell them the following based upon my limited experience:
    - Develop your own investment style and philosophy and stick to it.
    - Manage risk and profits will follow. This ties in directly to quality and research
    - Always do your own research, this means ignoring old and over-used truisms
    (I call them old wives tales) and go beyond the yield, price and P/E ratio
    - Never stop learning
    - Do not let emotions enter the mix
    - Patience, Patience, Patience
    - Learn from mistakes
    - Develop your own criteria as to when you should buy and sell.

    The above response is usually not well received. I find most people are looking for a quick and simplistic answer that requires very little mental effort on their part.
    I am lucky, I have no interest in football. This means I end up directing my analytical side toward stocks instead of a fantasy football team.
    Nov 20, 2014. 08:55 AM | 6 Likes Like |Link to Comment
  • What Should I Do About Those Non-Dividend Paying Stocks I Received In A Spin-Off? [View article]
    From a value standpoint HYH comprises .107% or out portfolio. Not enough to make any difference. i will probably end up selling them to help pay the taxes on the KMP/KMI merger
    Nov 19, 2014. 10:30 AM | 1 Like Like |Link to Comment
  • Successful Dividend Investing Requires Patience [View article]
    I am a big believer in your "Balance Up" approach. I buy the best quality stocks I can find. Once I own them, i find the thoughts of selling any of them to be quite painful. I use the dividends to do the "balance up" approach. In the long run it is probably a lot more profitable.
    Nov 13, 2014. 11:22 AM | 2 Likes Like |Link to Comment
  • The Dividend Stock Bubble [View article]
    I am a dividend growth investor. However, I also believe a lot of the good quality dividend stocks are over bought and over priced.

    I bought most of my stocks in late 2009 and early 2010. Right now I am not buying anything, I am accumulating cash from the dividends. When interest rates go up and equities go south is when I will invest that accumulated cash. I see it as an opportunity.
    Nov 13, 2014. 10:45 AM | 6 Likes Like |Link to Comment
  • We Don't Trust Wal-Mart [View article]
    If Walmart grows it's on-line presence like they promise, they should do quite well. Keep in mind, they have a massive distribution infrastructure already in place and the deep pockets required to become a significant player in the e-commerce arena
    Oct 23, 2014. 10:34 AM | Likes Like |Link to Comment
  • Is Coca-Cola Still A Tasty Investment After Poor Q3 Results? [View article]
    I am long on KO and it is one of the core holdings in my retirement portfolio. However, why does management wait for a problem before reacting. I am referring to a lack of aggressive marketing and the streamlining of operations. These are things that should have been in place ahead of time. Furthermore, streamlining the operations for the purpose of reducing cost is a one time improvement.
    This tells me that management is reacting instead of being proactive. One of the reasons I bought some extra shares of PEP is because of the proactive approach that Indra Nooyi (PEP CEO) was taking to improve the company and they have done quite well since then.
    I guess what Buffet said is true,
    "...Buy into a business that’s doing so well an idiot could run it, because sooner or later, one will"
    Oct 22, 2014. 06:12 AM | Likes Like |Link to Comment
  • Procter & Gamble: The Ultimate Dividend Growth Story [View article]
    After reading the article I was going to write about Warren Buffet's quote about any idiot running a company and how it applied to PG. It looks like you beat me to it.
    Oct 12, 2014. 06:57 AM | Likes Like |Link to Comment
  • Update: PepsiCo - Earnings Surprise And Above Average Valuation [View article]
    "...why others preferred Coca-Cola (NYSE:KO) over PepsiCo."
    Over half of PEP's business is snack foods and KO is 100% non-alcoholic beverages. As a result, I consider PEP to be only a partial KO competitor. I view PEP's snack food business as a compliment to many of KO's (and a lot of beer makers) products. That, combined with KO's world wide distribution capabilities is a couple of the reasons why I own both stocks.
    Oct 12, 2014. 06:53 AM | 1 Like Like |Link to Comment
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78 Comments
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