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Tortoise #1

Tortoise #1
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  • ConocoPhillips - Solid Fundamentals, Declines 10% As Oil Prices Fall [View article]
    I have owned Chevron (CVX) since March 1970 when it was Standard Oil of California. It is my #1 favorite all-time stock holding. During these days of falling crude prices, I have never considered reducing our ownership. Objective observers project some recovery of crude prices to $85-$90 bbl. in February 2015.

    We have been building a position in ConocoPhillips (COP) recently.

    As for the Saudis not reducing their production, I see this as a global game of "chicken" in which the Saudis hold the trump card - the lowest cost of production.

    As crude prices decline, the highest cost producers will begin to curtail production. It will take some months for this "game" to be effective. Tonight WTI closed near $67 bbl. and Brent at near $70.60. However, the prices of major oil company stocks have been rising. There seems to be an expectation that
    somehow steps will be taken to restore some balance between supply and demand.

    I have been adding to our COP holding sat $70 and below. With a dividend yield of more than 4%, I believe these purchases will prove to be rewarding!

    Never bet against big oil!

    Tortoise #1
    Dec 2, 2014. 10:02 PM | Likes Like |Link to Comment
  • Falling Oil Price And Energy Stocks [View article]
    As some participants in S.A. know, Tortoise is a long-term, dividend-growth investor! We have happily owned Chevron (CVX) since it was Std. Oil of California in March 1970. The performance of that investment has been dramatic and contributes richly to a very financially secure retirement.

    Within the last couple of years, we have added ConocoPhillips (COP) to our household portfolios and within the last two weeks have added to our positions as we expect crude oil prices to firm! While we wait for that, the COP dividend yield on our cost basis runs between 3.5% and 4.2%.

    You will all chuckle at one of my long held investment adage: NEVER BET AGAINST BIG OIL!
    Nov 22, 2014. 09:12 PM | 2 Likes Like |Link to Comment
  • Can The Alerian MLP ETF And Its 8% Expense Ratio Really Be Trusted Anymore? [View article]
    Folks, We also own significant positions in the MLP, Spectra Energy Partners. I mention this to protect my self from being included in Ron's "Uninformed money".

    The most of the Distributions from MLP in the Energy sector are "Return of Capital" and are, therefore, not taxed. However, the amount of the ROC reduces our cost basis and this becomes important if we sell any of our units held in taxable accounts.

    Should we decide to sell, we will incur severe tax consequences! The difference between the units sell price and the original cost basis will be taxed as long-term capital gains; where as, the difference between the original cast basis and the adjusted, lower basis will be taxed at our ordinary income tax basis.

    My point is that owning MLP individually can have serious tax consequences that we should, at least, be aware of!
    Sep 30, 2014. 02:35 PM | 1 Like Like |Link to Comment
  • Can The Alerian MLP ETF And Its 8% Expense Ratio Really Be Trusted Anymore? [View article]
    The first article about AMLP I recall seeing about the peris of paying corporate income taxes before share holders receive their dividend was the long commentary by a MorningStar analyst on 11/12/2012, "An ETA-Cautionary Tale". Subsequently, Ron Rowland has written extensively and critically on the issue.

    I saw nothing new in Mr. Dierking's comments.

    I think the point that is missed here is that in a retirees portfolio, a modest allocation in AMLP serves the purpose of generating a fine roughly 6% dividend yield plus a modest 12%/15% price appreciation. It has fulfilled that purpose!

    Sure beats existing equity markets and putting our money in safe places such as bank savings, C.D.s and Money Market Funds as many did in 2008/2009.

    And, Ron, "$9B of mostly uninformed money" is a heap of "uninformed money".
    Now, how did that happen?
    Sep 30, 2014. 02:12 PM | 1 Like Like |Link to Comment
  • Can The Alerian MLP ETF And Its 8% Expense Ratio Really Be Trusted Anymore? [View article]
    Mr. Dierking, We have happily owned AMLP in our household portfolios for longer than two years. The yield on our cost basis is between 6.2% and 6.4%. This yield is what we expected and we are satisfied with it! We have also had about 15% share price appreciation. Again, we are satisfied!

    When I bought our initial position in AMLP, I was aware that it was structured as a
    c-corporation and would pay corporate income taxes. I was never fooled. That said, it was the anticipated over 6% yield I wanted and we have not been disappointed.

    Your assertion that Alerian is committing some kind of fraud against their investors is absurd.
    Sep 30, 2014. 06:27 AM | 2 Likes Like |Link to Comment
  • Dividend Challengers: 12 Increases Expected In The Next 11 Weeks [View article]
    David, As a long-term, dividend-growth investor, I very much appreciate your reports and projections and thank you for them! Let me add for the newer participants in S.A, my experience is clear: As the dividends are increased there is a correlation with higher price for the underlying stock; so, we "win" in two desirable ways. Here is an example: Yesterday, while cleaning-out outdated "stuff" in a file, I found the purchase document dated May 5, 1994 covering 400 shares of Southern Company (SO) at 19-1/8. The stock has been trading near 44 for sometime and I suspect when the two, very expensive, new generating facilities in Georgia and Mississippi are completed, we will see higher stock prices. I still own those 400 shares.
    Sep 14, 2014. 01:03 PM | 4 Likes Like |Link to Comment
  • ConocoPhillips: Deep Value At A Discount Price Even Without Warren Buffett [View article]
    jacksalmon, Your comments and opinion point to much lower prices for COP stock. In view of your predictions, I am surprised you have not mentioned taking a short position on the stock.

    One of my axioms of investing is "Never bet against big oil!" My largest investment position is in CVX which I have owned since March 1970. I added COP to our portfolios within the last two years at prices well below current levels. As a long-term investor, I have seen hundreds of sell-offs and subsequent price recoveries with dividend increases.

    CVX has raised its dividend for 27 consecutive years! Therefore, our income has continued to increase without us having to invest another nickel. As an example, in 2001, the CVX annual dividend rate was $1.30/share. In 2014, it is $4.28.

    If I had not experienced this remarkable performance, I would think it was a myth.
    I can happily tell you it is NOT a myth!

    Tortoise #1
    Sep 9, 2014. 09:32 PM | 6 Likes Like |Link to Comment
  • PFXF: An ETF With Attractive Yield, But Does It Hold Only Preferred Equity Shares? [View article]
    User, I checked my 1099-DIV for 2013 to determine the Qualified percentage of dividend income: PFF 67.3% PFXF 21.9%

    You have asked a good question! Thanks!
    Sep 9, 2014. 11:52 AM | Likes Like |Link to Comment
  • PFXF: An ETF With Attractive Yield, But Does It Hold Only Preferred Equity Shares? [View article]
    We happily own both PFXF and PFF in our household portfolios specifically to generate monthly income and, for that purpose, these have been excellent positions. On an annualized dividend income basis, on our cost basis, PFXF yields 6.3% and PFF 6.4%. We are delighted with these yields!

    We are aware that when interest rates begin to rise, the share prices of these two ETFs will likely decline.
    Sep 8, 2014. 03:47 PM | 1 Like Like |Link to Comment
  • Have I Been A Successful Investor? What Constitutes Success? [View article]
    Tortoise #1 is a long-term, dividend-growth investor who began buying dividend paying stocks in the 1960s to augment my career income and help pay our growing family expenses. As years passed, I began to note that our dividend income and portfolio value were increasing without any action on my part. I had stumbled onto dividend-growth investing and have essentially followed that strategy the rest of my life.

    How do I measure investment success? First, I study the performance of our total investments - and not individual stock performance. On that basis, our dividend income is larger than our household expenses. Now in our late 80s, Mrs. Tortoise and I live comfortably without ever having to invade principal! I consider that the successful result of a lifelong, D-G, buy and hold high quality stocks, strategy.

    Some of my favorite stock holdings many of which go back to the 1960s, 70s and 80s are: Chevron (NYSE:CVX), Abbott (NYSE:ABT), Kimberly -Clark (NYSE:KMB), NextEra Energy (NYSE:NEE), SCANA Corp. (NYSE:SCG), Southern Company (NYSE:SO), Taubman Centrs (NYSE:TCO) and Verizon Communications (NYSE:VZ).

    In the last decade, we have added the MLP Spectra Energy Partners (NYSE:SEP) and the ETF Alerian MLP ETF (NYSEARCA:AMLP)

    In addition to the growing dividend income, many of our positions have huge
    capital gains (if we were to sell).

    Finally, I have never bought a stock with the thought of trading it for gain. All purchases were based on Dividend-Growth!

    I offer this history to encourage our younger investors to become INVESTORS and not traders!

    Tortoise #1
    Aug 24, 2014. 06:20 PM | 11 Likes Like |Link to Comment
  • Alerian MLP ETF Finally Admits Its 8% Expense Ratio [View article]
    The Distributions from most MLPs in the energy sector, held in taxable accounts, are Tax Deferred that reduce the investors original cost basis. Should you decide to sell your holding, the difference between the sale price and the original basis price will be taxed as long-term capital gains; whereas, the difference between the original cost basis and the adjusted basis price will be taxed at the full income tax rate.
    (source: InvestingDaily Personal Finance, Dec.28,2011)
    Aug 24, 2014. 05:28 PM | 1 Like Like |Link to Comment
  • Alerian MLP ETF Finally Admits Its 8% Expense Ratio [View article]
    Ron, Acknowledged with thanks!
    Aug 22, 2014. 12:36 PM | Likes Like |Link to Comment
  • Dividend Champions: 7 Increases Expected By Halloween [View article]
    For long-term, dividend-growth investors, I want to add that continuing dividends during Bear Markets helps us tolerate declining portfolio values as occurred in 2008/March 2009. And, as markets recovered, we were, and are, richly rewarded.
    Aug 21, 2014. 09:40 PM | 1 Like Like |Link to Comment
  • Alerian MLP ETF Finally Admits Its 8% Expense Ratio [View article]
    Ron, When I began adding shares of AMLP to our household portfolios, I was aware that the ETF was structured as a C-Corporation and would pay corporate taxes that would reduce our total return. That said, the investment has fulfilled our expectations with 6.3% yield on our cost basis and 16% increase in value. I was not deceived and am happy with the results!

    Without being argumentative, your readers know your position on AMLP. Please tell us your recommendations, in a general way, to replace AMLP in a portfolio.

    Thanks in anticipation!
    Aug 21, 2014. 01:10 PM | Likes Like |Link to Comment
  • Alerian MLP ETF Finally Admits Its 8% Expense Ratio [View article]
    In the above, I mention "Don". Sorry, I meant RON.
    Aug 20, 2014. 10:28 PM | Likes Like |Link to Comment
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431 Comments
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