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maddynuke

maddynuke
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ADP, AEP, BMY, BWC, CCJ, CNX, CVX, D, DIA, DNN, DUK, DVY, ETR, EXC, FE, GVP, JCP, JNJ, KO, LEU, MRK, NLR, PEG, PLUG, SDY, SE, SLV, SLW, SO, SPY, URRE, UUUU, WEC, XLU, XOM, XRX
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  • Facts Show It's Time To Buy First Energy [View article]
    Great article. I think it takes someone working at a utility to understand why the drop because of 2016 PJM anticipated sales and the downgrade is so counter-intuitive. After 14 years in utility-land, then teaching nuclear engineering at Penn State and now leading research at DOE, I really appreciate that you explained what the PJM system does and what/how utilities use the forecasting, contracts etc. to hedge their generation costs, production rates, and sales prices for bulk transmission!
    I saw the drop with EXC and FE as an opportunity to consider buying more EXC and starting FE position. Their prices may stabilize today or tomorrow, so then I will jump in. No need to catch a falling knife, but when it hits the floor, it is time to pick it up.
    May 30, 2013. 01:32 PM | 2 Likes Like |Link to Comment
  • As stocks move broadly higher, utilities (XLU) lag following downgrades of Exelon (EXC -7.1%) and First Energy (FE -6.7%) by Deutsche Bank based on "the ugly reality of the 2016-17 RPM auction results." The firm sees downside in all integrated power names as the "uncertain path to a power market recovery forces investors to reconsider the multiples paid for commodity cyclical power generation assets." (earlier[View news story]
    And they can correlate the PJM low bidding for a week and project 4 years into the future too!! Yikes. It is a good day to pick up some more EXC (I am already long on EXC) and to pick up FE.
    Deutche Bank rating somehow holds the key to this lemming race to the sea, and it is based on PJM forecasts, yet PEG is positive. Go figure.
    May 28, 2013. 01:56 PM | Likes Like |Link to Comment
  • Exelon Announces Leadership Changes at Exelon Generation and Constellation [View article]
    Does anyone know why this announcement could possibly cause a +7% drop in EXC price?? Beats me.
    May 28, 2013. 12:30 PM | Likes Like |Link to Comment
  • Dangers Of Utility Investing: An Unappreciated Risk Is Growing Bigger Every Day [View article]
    Thanks for the comment Blutopaz. Also, the "energy equation" for making the solar panels is never discussed or even mentioned. Making silicon-based collectors is a very energy-intensive process....
    May 22, 2013. 02:37 PM | 1 Like Like |Link to Comment
  • Silver Wheaton's CEO Hosts Annual Shareholders Meeting (Transcript) [View article]
    These SLW fellows are ingenious, since they have the revenue streams providing ample cash flow, so that the bank account can be low/zero, and use the capital for getting more contracts. The mining companies take the risk of building and running the mines, and SLW takes the "bi-product" or "waste" stream silver at a fixed, low cost, and brokers it off to get it processed with fixed, higher cost contracts. They have a very small cadre of people, very efficient operations. It is the ultimate middle-man strategy! Low price now, so buying small positions over time will work...I am long on SLW of course.
    May 22, 2013. 12:23 PM | Likes Like |Link to Comment
  • Dangers Of Utility Investing: An Unappreciated Risk Is Growing Bigger Every Day [View article]
    Your article is very naive!!
    First, the Australian solar mandate has NOTHING to do with U.S. utility situation.
    Second, solar collection plates on houses only work if the sun shines most of the time, at a good angle etc. It will not replace base-load electric generation by utilities. Storage battery technology and solar systems do NOT provide "zero cost" electricity. In fact, the investment for most home owners takes at least 7-10 years to be recouped, if the ongoing maintenance costs are not included. Most homeowners are NOT going to climb up on their roofs to clean and maintain their systems. Even if solar and battery technology advances, the costs will not come down 10% per year. Notice that SolarCity is installing the home-based unit for "free" but the requirement is to have a very long term (i.e., costly and profitable) maintenance contract to service the homeowner's system. PURE Fantasy on your part!!
    If the utility invests in solar power collection at large sites, within their distribution network, has ongoing maintenance, etc., then it may be profitable eventually.
    D. Short is hardly an expert on solar technology!!!! LOL.
    May 22, 2013. 12:00 PM | 1 Like Like |Link to Comment
  • 5 Commodity Stocks Moving On News [View article]
    So at what price would you consider BUYING SLW? What is your figure of merit for determining when the "shakedown" is over?
    May 20, 2013. 11:16 AM | Likes Like |Link to Comment
  • Utility Investors Should Focus On ROIC, Not Dividend Yield - Part I: DJU Index's Best [View article]
    Great analysis and reminder for every high yield dividend investor! Since utilities (the ones with nuclear plants!!!) are the biggest chunk of my portfolio, I have always used ROE, ROIC, P/E and yield in my analysis of when to buy and when to sell, not only utility shares but other dividend aristocrats/champions. The figures of merit I use involve the Value Line safety and timeliness numbers, i.e., never invest in a company unless it has an S== 1!! The T, timeliness gives a measure of momentum. So my SCREENING metric uses:

    M1 = Yield % x ROE / (P/E) * S * T

    M2 = Yield % x ROIC / (P/E) * S * T

    You will note that by having the (P/E) in the denominator, means that I have EARNINGS weighted highly, with its correlation to ROE, ROIC and yield. That's ok. I want a company that is SAFE, EARNS and provides yield, and gives good returns with respect to capital investment and equity.

    If you cannot get the T or S from Value line, the surrogate is getting safe companies from the S&P 500, DVY, Aristocrats, etc list, and calculating momentum by using a time weighted (change in price)/ price ratio.

    Again these are SCREENS, and not the sole reason to buy a utility or any good blue-chip stock, but only the start.

    Thanks for the article!
    May 17, 2013. 01:19 PM | Likes Like |Link to Comment
  • What If Long-Term Dividend Investors Buy Before A Crash? [View article]
    Thanks for your article. We all can say "wouldha, couldha, shouldha," for missing opportunities, timing mistakes etc. I think we need to remember that we are buying stock in a company, so we are buying the company--its business model, dividend philosophy, earnings potential, etc. The key is knowing WHY you buy a stock and WHY you need to sell it vs. WHEN to buy or sell them.

    Fortunately in July and August 1987 I saw that the inversion of the fed funds rate and interest rate and the impending debacle, and sold some losers and winners, against the advise of my stock broker. I was able to buy the winners back later after the November drop. MCD at $15--wow. Exelon at $ 2-4 equivalent per share today. etc.

    Similar situation in 2008 -2009 and now the portfolio is popping, especially for nuclear utility shares, that I bought in steps to dollar-cost-average. .

    The key is to have some cash reserves to buy some shares, but not all at once, since we, as small investors, cannot know a priori which way the market is going. Not even the big companies, gurus know that!
    May 17, 2013. 01:00 PM | Likes Like |Link to Comment
  • Dividend Aristocrats Vs. Select Dividend Index [View article]
    that is what DVY is for.....
    May 2, 2013. 01:52 PM | Likes Like |Link to Comment
  • Many Of My Dividend Growth Stocks Have Become Overvalued, What Do I Do Now? [View article]
    Your article and graphs are so very informative. You only mentioned 2 utility stocks, and said that they might be overvalued but you would keep them, but not buy more. Do you have any opinions about the larger electric utilities that still have low P/Es and have taken some hits lately, e.g. PCG and EXC? Given that the electric utilities have a low beta, slow/small growth and have some price stability, what P/E (trailing or expected) would you use as a trigger to consider adding that utility to your portfolio?
    Apr 26, 2013. 11:38 AM | Likes Like |Link to Comment
  • Xerox Management Discusses Q1 2013 Results - Earnings Call Transcript [View article]
    It's simple--they are too afraid to fire her because the Politically Correct police would be screaming racism.
    Apr 25, 2013. 01:04 PM | 1 Like Like |Link to Comment
  • Exelon Corporation (EXC) declares $0.31/share quarterly dividend, 41% decrease from prior dividend of $0.525. Forward yield 3.33%. For shareholders of record May 15. Payable June 10. Ex-div date May 13. (PR[View news story]
    Some of us did, even though the Seeking Alpha group-think was that we were nuts.....so I am happy with the rise in the price, even though the dividend went down by half. I think it has paid for itself now.
    Sometimes bad news is the better time to buy a stock.
    Apr 24, 2013. 03:52 PM | Likes Like |Link to Comment
  • Why Is The PC Market Really Failing? [View article]
    Most folks who are connected to the internet for Facebook, games, yahoo, emails, catching videos, news etc. merely need a tablet, net book or smartphone. If they have to download a document to read or music, these will be sufficient.

    But productive work environments require the use of word processing tools, spread sheets, and applications that don't do well on these toys, or cars, as Jobs mentioned. Sometimes you just need the car, but when you have work to do, it is the truck, the PC, however how old or clunky. Most folks have a PC at work and home, and then these portable items.

    "Portable PCs" as in laptops, and high end items will either have to get lighter, cheaper, etc. to compete or they will die. Why get a Dell portable laptop at $1200-1500 when a Dell notebook $ 250-400 will do just the same? You can bring a portable disk drive if you need it $40, or just a big thumb drive $30.

    Game changers will be "Go To Meeting" using the camera on iPads and smart phones, Windows 8 applications for note books and I pads, and connectivity directly from my smartphone/net book to my office pc, without the internet bogging me down.
    Apr 22, 2013. 12:41 PM | Likes Like |Link to Comment
  • What Return Should Investors Expect From The Market In The Next 10 Years? [View article]
    Your thesis that the average market yield would be about 6% is not consistent with the graphs you show, especially figures 3 and 4. Historically any large divergence is quickly mitigated and reduced to about 2%. So the current S&P 6 % yield on figure 4 is too high, and would swing lower to about 4% soon enough, or lower.

    The stock yields are very high, and dividends would not have to increase to be attractive. Companies are usually loathe to reduce dividends, but their prices, buyback policies, would seem to indicate that only 2-3% higher than the 10 year treasury rate is all that is needed to keep stocks attractive. Also, the timing for this drop looks very soon, as well.

    Any comments?
    Apr 22, 2013. 12:24 PM | Likes Like |Link to Comment
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