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  • Uncertain Times Call For Certain Dividend Payers: Electrify Your Portfolio With Con Edison  [View article]
    RE SO --
    This is a company with very good fundamentals. SO and ED have been two major pillars of my portfolio for several years, though for the time being I've sold out SO.

    It's price has gone nowhere the last year because some major projects have gone over budget and then over again every quarter for the last few quarters. Those projects are still incomplete with no sure end in sight.

    INVESTING
    SO is a good example to me of why most investors like myself should limit specific stock choices to no more than they can keep track of, and fill in with indexes for the rest.

    SO has a tempting dividend which can attract the naive, and that brings up another point. Dividends were always the gold standard of the stock market indicating solid mature companies, a reliable anchor for both conservative portfolios and more speculative ones.

    THE ECONOMY
    Now "dividend aristocrat" has become a magic buzzword that clearly many people who invest don't understand. Companies one after another seem to be falling under the compulsion to raise their dividends just to stay in a race to keep their stock prices up.

    Many companies are actually borrowing money to pay those dividends and in the process are cannibalizing their futures. There is an old joke about giving your dog a nice piece of meat by cutting off his tail.

    Dividends may mean growth for your stock price in the short term, but not for your company in the long term. Borrowed money should be invested in research and development.
    What this bodes for our future, I don't know. Is our economy really capable of dynamic growth any more? This may be the biggest factor for investor nervousness over the recent tiny raise in Fed rates -- with a more substantive raise in rates, companies won't be able to continue to inflate their dividends.

    Yet the bottom line is that a bloated stock market based upon a sluggish economy that may in fact be growing weaker will do no one any good in the long run.
    Feb 6, 2016. 05:59 PM | 1 Like Like |Link to Comment
  • General Electric: We Are Liking This Trade  [View article]
    Good comment, David.
    Probably no one who uses this site should be SELLING options EVER.

    As you aptly described, selling (not buying) puts other people in the driver's seat while you have to wait upon them and quiver and pray to Mammon that the market doesn't have one of those hiccups that in fact it inevitably has at least one to five times a year on average (suppose it is just rumored that ISIS has The Bomb? Suppose our beloved Donald actually gets nominated and then promptly has a heart attack?)
    Buying (not selling) PUT options is about the only thing most people should even consider, for example as a hedge to freeze the price for a few months on stock you own -- say, you have ongoing medical expenses and you need to be sure of the stock's price but want to wait til January of next year to sell so you can maximize your tax breaks.
    Feb 2, 2016. 05:12 PM | Likes Like |Link to Comment
  • AT&T Raises Dividend 2.1%. What Now?  [View article]
    One can select dates that may show something different, but the actual chart to me denotes clear downward movement.
    -- More substantively, T's advocates point to buybacks and borrowing and "improvements" that are mostly maintenance-- these are not evidence of real expanding productivity that must be the ultimate basis for real value. Latin America, cited as example, is a glowing promise, a vast continent with a lot of potential but also unstable environments and a lot of risk -- and a lot of competition from newer more dynamic companies.
    Feb 2, 2016. 12:14 PM | Likes Like |Link to Comment
  • AT&T Raises Dividend 2.1%. What Now?  [View article]
    "I'm still waiting some posters to text wall paste about why AT&T will collapse and fail."

    Rather than wait for someone else, why not speak about it yourself? I have enough research to do just to keep atop matters closer to home and less speculative than whether Latin America is a golden opportunity or a black hole, but I'd welcome more detailed argument based upon fact, not fond hope.

    I've watched T's stock get a temporary goose from sanguine reports of mergers or agreements that would combine T's huge customer base with the manufacturer of some new app or other new gadget. The trouble is that the "gadget" industry moves so fast that devices are obsolete almost from the day they reach market.
    Is T's management really up performing in super fast moving industries? Or are they still stuck in the thinking appropriate for when Ma Bell was a highly regulated monopoly?

    I'm very skeptical about the whole telecom industry despite the tempting yields. T's stock price has been steady as a clock going down 3% a year for three years in a straight line, most of it while the S&P index was rising. That leaves a not so good real gain of 2 1/2% a year (the 5 1/2% dividend minus the 3%/yr decrease in value). That fact doesn't bode well for the company's future.

    Also, "free cash flow" only means something when it comes from profits that net you more cash than you've had time to disburse. From what I understand, T has extra cash because they've been borrowing it, raising their debt and mortgaging their future -- not from real earnings.
    Feb 1, 2016. 03:18 PM | Likes Like |Link to Comment
  • J&J Should Not Consider Splitting Its Business  [View article]
    "... look at the results of those that did happen."

    The author in fact did mention two -- Conoco which is suffering more than others in the oil price drop because the spin off of its refining business made it too "front-end" and more vulnerable to price fluctuations. ADP was also discussed--Moody's downgraded them because they believe ADP is no longer diverse enough to endure business fluctuations.

    "what is the explanation for why the conglomerate model was largely abandoned in the late 20th century?"

    -- Because there was no good business reason in the first place for most of the mergers. Most were hopelessly unwieldy and unworkable, and predictably so, but the hype of something "new" attracted the foolish and it still does.

    It should scare the daylights out of everyone that only three corporations in the world's largest economy are perceived to have the stability and balance to earn AAA ratings.
    Yet some d----d fools are screaming to carve them up when we should all be demanding that more companies emulate their principles before we buy their stock.
    Jan 28, 2016. 07:57 PM | 7 Likes Like |Link to Comment
  • Senator's HCV Rant Won't Slow Gilead  [View article]
    Shock Exchange -- your comment here was better than your article, which frankly was emotive and reactive.
    In order for us to look at our sleazy and easily corruptible congressmen, we have to look at ourselves above all for electing them,
    we need look at our mindless acceptance of "tax cut" as a universal cure-all.
    The WSJ article clearly stated that the problem with dispensing this life saving drug to our veterans were "budget restraints".
    How about all of us getting off of our collective ----s and demanding higher taxes for the real welfare queens who are at the top, for execs who get obscene guaranteed "bonuses" for producing nothing, for example?
    Sen. Sanders' "rant" was just an attempt to draw attention to the issue.
    Bernie has been one small voice in the sea of fat-cats who we elected. For our own sakes, we should be supporting his agenda.
    May 16, 2015. 09:40 AM | 3 Likes Like |Link to Comment
  • Wells Fargo CEO Stumpf discloses $19.5M purchase of Chevron stock  [View news story]
    It doesn't necessarily mean anything.

    He's director of CVX, and CEO of Wells Fargo meaning that he is heavily involved in a very inbred business.

    The few million he spent to calm a volatile market can likely be written off in the long run as a mere cost of doing business as an executive, even if the gesture doesn't pan out.
    Meanwhile I have a few shares of CVX for the dividend, and more of Exxon, the more reliable company.

    Of course no one on the outside knows his motive, but to buy CVS simply because he bought would be very foolish.
    We don't know what he's thinking.
    May 13, 2015. 04:33 PM | 3 Likes Like |Link to Comment
  • AT&T Should Consider Splitting In Two  [View article]
    Creative companies reinvent themselves.

    Doesn't "telecom" include cell phones, and computers?
    Of course it does.
    There is a huge revolution in communications, almost all of it led by new start up companies. Where was telecom in the "Tech Revolution?"

    The fact that most of the Bell spinoffs and their competitors aren't showing much doesn't excuse anything -- there is and was something wrong with all of them.

    They never got out of the mindset of the regulated monopoly that was Ma Bell. I don't buy that canard about "all those regulations" -- Bell the regulated monopoly was forward looking and creative. As soon as they were deregulated it was like "teacher's out of the room -- we can do whatever we want" to a bunch of half-witted kids -- led by MCI they engaged in larceny and fraud, ran up huge debts trying to compete with fanciful accounting reports and crippled themselves, probably permanently.

    Our host does some good analysis and I don't want to appear to be attacking him. Splitting a company won't by itself create two creative companies. Especially if you split, you need very dynamic people in the resulting parts in order to make it work. The problem is a much larger one -- we are losing our creative energy -- its a bad sign that we look more and more overseas for what we need.

    A very good split will be GE industrial from GE Capital -- mainly because banking down the road will likely prove very toxic. Good move by Immelt even though they lose income in the short run, and he should know.

    May 7, 2015. 04:34 PM | 3 Likes Like |Link to Comment
  • AT&T Should Consider Splitting In Two  [View article]
    Reorganization is a cozy scheme for the incompetent managers and insiders who are running things into the ground.
    It is a convenient short term distraction from quarter after quarter of diminishing returns.
    Reorganizations are hugely profitable to corporate lawyers,
    They are a windfall for execs who will get huge "golden showers" in stock options, and large bonuses when they all are promoted sideways, up, or out.
    They usually contribute nothing to the company or its components.

    This is a stockbrokers solution for everything.
    Most of them have no idea how to run a company,
    they have no idea what creative management is.
    If you have uncreative, unproductive management,
    which is clearly ATT's problem,
    new titles and new offices won't do a thing.
    Brokers hope that the short term chaos and sturm and drang will give them something to sell
    until everyone realizes that all the noise produces nothing.

    If you want a short term goose to your stock, and don't care about the company's future, breakups and mergers are a good idea.

    Investors have to remember that new money is created by creative ideas,
    this "idea" is merely "engineering" smoke and mirrors,
    and sucker bait for the ordinary investor.
    May 7, 2015. 10:46 AM | 12 Likes Like |Link to Comment
  • Why I Am Exiting My Position In General Electric  [View article]
    Alex, I see Ge's current prospects are not a growth situation and I am assuming a not very good economy for the long future, with a major correction very possible. Selling Capital was a very good thing.
    I bought a bunch of shares just as you did early in the year for the then 4% dividend attempting to anchor my conservative portfolio in a not dynamic but pretty stable company. Bond ETF prices are forever teetering on the edge of a rise in interest rates.
    Another good anchor I see is Con Ed currently paying 4.2% dividend. I've actually done pretty well with both companies over the last 5 years by defensively buying and selling some of my shares on the up or down blips as these stocks moved mostly sideways.
    Apr 17, 2015. 09:36 PM | 1 Like Like |Link to Comment
  • GE: At 19 Times My 2016 Earnings Estimate It's Time To Sell And Move On  [View article]

    Hi Bob --
    This is from a link to Jeffrey's bio on a GE website,
    http://invent.ge/1aEG92w

    "several global leadership positions since coming to GE in 1982,
    including roles in GE's Plastics, Appliances, and Healthcare businesses.

    "In 1989 he became an officer of GE
    and joined the GE Capital Board in 1997."

    Point taken. He wasn't the CEO of Capital, but he was on the Board of Advisers to the chief.
    Apr 17, 2015. 08:42 PM | 1 Like Like |Link to Comment
  • GE's Complete Leadership Failure  [View article]
    Thank you, Bobcat. Loyalty is commendable, and an important perspective to share. Too many people who disparage our system could benefit from the perspectives of people who have worked in dynamic companies.
    Your thumbnail of Jeffrey Immelt is consistent with and fills out a little my impressions of him.

    I believe he and Obama are tempermentally made for each other, I can understand why Obama appointed him to special committees and seeks his advice, but they may not be so good for the nation and we don't have to trash anybody in order to say that.

    I can see that Immelt is trying to do a very hairy balancing act, one that requires more than just good character and more than good competence. Both the nation and GE require a kind of person who now and then emerges as if by magic and who doesn't seem to be available any more, and that failing reflects upon all of us. We all contribute to whatever culture promotes the people who lead us.
    Meanwhile I sold a few of my shares on last week's "bump" and I'm keeping the rest for the dividend.
    Apr 17, 2015. 04:26 PM | 1 Like Like |Link to Comment
  • GE: At 19 Times My 2016 Earnings Estimate It's Time To Sell And Move On  [View article]
    A 4 % dividend is the very high end of
    what relatively stable companies are paying nowadays.

    It is a good dividend.
    Any more and you should be suspicious.
    If you bought GE before the "bump"
    then you are getting close to that 4%.

    Immelt is acknowledging upfront the lowering of earnings short term from the sell-off of most of GECC. Instead of promising an even higher dividend, he's buying back shares to support the stock price short term and keep it stable so you don't lose that dividend to a stock price devaluation.
    He is hoping that the manufacturing side will grow in the meantime to compensate for the loss of GE Capital's income.

    -- THAT is where we might have a problem.
    Large corporations have ever increasing difficulty growing their profits as they get larger. Jack Welch turns out not to have been so brilliant. He, mainly, was responsible for the debacle of GE Capital which almost killed the company, but Immelt was his understudy, the head of the banking division under Welch, and his handpicked successor. That is only part of his resume but that part is not good.

    Getting rid of GE Capital is a darn good thing to do -- don't buy anyone's hype that a crash can't happen again. Don't buy that we are fully protected by the Dodd-Frank regulations. We could very well be building to another crash and in the not so distant future.

    The industrial side is profitable, thanks to strong foundation built over previous decades, not thanks to this and the previous CEO's. If Immelt has added significantly, we haven't heard about it. The energy foray isn't nearly as irresponsible as what happened with GE Capital, but it has proven highly volatile and contrary to the stability of a mature corporation that wants to make steady dividends part of its attractiveness.

    The bottom line is do they have plans to CREATE something that will create new wealth? We aren't hearing about them. Stock buybacks and dividend disbursal have virtues but they do NOT create new wealth.
    Apr 17, 2015. 03:23 PM | 3 Likes Like |Link to Comment
  • GE: At 19 Times My 2016 Earnings Estimate It's Time To Sell And Move On  [View article]
    I've been looking for a sector analysis, important to evaluating what the spinoff of GECC means short term and long.
    I'm not thrilled with GE's growth prospects, I sold 1/3 of my stock last week due to the "bump" but where else can you get good stability and a 4% dividend (I had bought my remaining shares at 24)? Not with ATT, for example.
    Apr 17, 2015. 01:03 PM | 2 Likes Like |Link to Comment
  • General Electric: Long-Term Investing Vs. Short-Term Thinking  [View article]
    The problem is that when we invest
    in the same vehicles,
    which all of us do,
    then all of us are business partners.

    The problem is that even when you have a good helmsman,
    if enough of your fellow passengers are jumping up and down
    then you and your more sober friends will drown with them.

    We are a collective like it or not.
    Jeffrey has to weigh and satisfy a hundred factors
    that may have nothing to do with an ideal business model,
    which cannot exist anyway
    with the human factor.

    Or Jeffrey may just be a mediocre CEO
    who we all created:)
    Apr 17, 2015. 12:15 PM | 1 Like Like |Link to Comment
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