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SDS (Seductive Dividend Stocks)
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Sorry I hide my true identity but I'm a physicist/engineer, native contrarian and idea generator. I am an eclectic dividend investor with motto "In God We Trust, All Others Pay Cash" applied to companies I invest in. I like to read /and read a lot - did you look on my SA photo 8-)? /... More
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  • Book Review: "Income Investing Secrets"

    Each day now about 10 thousands Americans are retried and they need to figure out how to replace their salaries. Richard Stooker provides very useful help in his good book "Income Investing Secrets" for any small investor. The book consists of 3 major parts - philosophy of income investing (II), II tools, and some unique II tips.

    The first part is one that has resonated with my approach to investing, as it is consistent with my experience as dividend investor because of it fundamental truth and simplicity.

    The second part briefly describes different II tools from well known such as stocks and bonds to previously unknown for me such as enhanced income securities or corenotes. Risk of each tool is outlined, so investor can decide if the tool worth more deep investigation.

    In the third part Richard Stooker (who is a smart amateur investor) outlines his ideas on II and some life aspects.

    The ratio signal-to-noise (i.e. useful information to "bla-bla-bla") is much higher in this book than in most investment books I have read, so I'd recommend "Income Investing Secrets" for any individual investor.

    13 September 2014

    Sep 14 1:45 AM | Link | Comment!
  • Dividends In Danger: September 2014 - Nu Skin Enterprises Inc.

    Nu Skin Enterprises Inc. (NYSE:NUC) is included in D. Fish's CCC list
    I don't follow NUC but put it on price alert below 42$. After I got alert I checked why price dropped. It seems that the company cooked books and cannot pay debt from few recent SA articles. If it happens NUC has to postpone dividends payment. Also some SA authors claims that the company uses multi-level marketing, which is often a grey zone between legal and crime. So I'd not buy NUC at least until they clean up the case.

    10 Sept. 2014

    Sep 10 5:29 PM | Link | Comment!
  • On Dividend Research From Ned Davis Research

    Many dividend growth investing (NYSE:DGI) proponents (including myself) use famous Ned Davis Research graph (fig.1) to argue that dividend investing is outperforming approach. Usually this graph came from a third party and unfortunately the original source is not available for small dividend growth investors (DGis). But this graph might be not so impressive for DGis as it appears on the first glance. Do you not that the top orange line is for dividend growers AND initiators? If yes - how many dividend initiators are in your portfolio. It is Zero in my…..

    Fig 1.

    At least couple questions should be answered for better understanding of the graph:

    a) What is the definition for dividend growers in Ned Davis Research report? Are these companies from David Fish's or similar list with long history of dividend growth or just companies which increase dividends in year N to compare with year N-1?.

    b) What is the definition for dividend initiators in Ned Davis Research report? Will be ABC company qualify as the dividend initiator in 2013 if last dividend they paid 1973 or in 1990 or in 2011 but not paid dividend in 2012, 1991-2012, 1974-2012?

    Any DGi knows how to find a dividend grower - just look dividend history (or David Fish CCC list), check recent years earnings (better if they are positive in last 3-5 years), check payout ratio (better if it is below e.g. 50% in last 3-5 years), check company announcement (verify that they are not going to cut dividends soon for other usage of capita) and you might be 99% sure that this firm will pay dividends next year.

    I have no clue how to find a dividend initiator. Should I just read company announcements? How can I be sure that the initiation of dividend will lead to long dividend history (well some companies promise to pay dividend next 3-5 years but I do not recall anything beyond such relatively short period /I guess CEO and BOD cannot foresee/).

    I think we should address questions a) and b) to Ned Davis Research ( Hopefully they will answer if couple dozens people ask them….

    12 Aug 2014

    Added 11/27/2014

    Ned Davis Research have analyzed data for Europe ex-UK and also found that dividend stocks outperform non-dividend (fig. 2 below).

    (click to enlarge)

    Fig. 2

    I still have no clue about their methodology.....

    Aug 12 11:34 AM | Link | Comment!
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