Back in January 2010 I wrote a blog entry called "So, What If The Volitity, Bear Market Is Not Over". It seems like it did not even spell "volatility right". In any event, this post for some reason gets lots of spammers adding comments. They praise the site to sky, but all praise is very generic. Did these people not realize that Blogger is very good at catching spam and does not allow these "comments" on my site?
I do not know what it might mean, but spammers have certainly found my site. The generic praise is ludicrous. However, anyone with a condo site in UK or Australia would think that their posts about their condos is in any way connected to my blog entries on investing in dividend stocks in Canada is beyond me.
There is also a number of spammers whose web site shown on the comments does not align well with the underlying web site name. I delete all of these also. I do not want my readers to click on a web site that might be pornography or contain virus.
I must admit that I am very pleased with the programming Google uses to identify spammers. I very seldom disagree with their assessment of blog comments.
On my other blog I am today writing about Medtronic Inc. (NYSE-MDT)...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
Monday, September 30, 2013
Friday, September 27, 2013
Buying the Market
I have heard many times that if you buy more than says 20 stocks, you might as well buy the whole market as you will not do any better.
However, this has not been my experience. When I started funding my RRSP and then my Locked-In RRSP, I chose different stocks that I had in my Trading Account. I have done the same thing for my TFSA. I currently have 51 stocks. I just bought a brand new one for my TFSA account this year.
My return last year was 13%. The TSX is up by 4%. Mine you I am including dividends in my return, which the TSX is not. However, my dividends accounted for 3.75% of my return, which leaves my capital gain at 9.75%.
My 5 year total return is 6% per year. The 5 year TSX return is negative 2.1%. The TSX adjusted for dividends at 2% per year is negative 0.1%. (I use 2% because I have read it is the long term average dividend return for the TSX. I know the current one is 3%, but it varies all the time and I have not yet found a place where I can find the dividend yield on the TSX over a number of years.)
On my other blog I am today writing about Canyon Services Group (TSX-FRC, OTC-CYSVF)...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
However, this has not been my experience. When I started funding my RRSP and then my Locked-In RRSP, I chose different stocks that I had in my Trading Account. I have done the same thing for my TFSA. I currently have 51 stocks. I just bought a brand new one for my TFSA account this year.
My return last year was 13%. The TSX is up by 4%. Mine you I am including dividends in my return, which the TSX is not. However, my dividends accounted for 3.75% of my return, which leaves my capital gain at 9.75%.
My 5 year total return is 6% per year. The 5 year TSX return is negative 2.1%. The TSX adjusted for dividends at 2% per year is negative 0.1%. (I use 2% because I have read it is the long term average dividend return for the TSX. I know the current one is 3%, but it varies all the time and I have not yet found a place where I can find the dividend yield on the TSX over a number of years.)
On my other blog I am today writing about Canyon Services Group (TSX-FRC, OTC-CYSVF)...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
Wednesday, September 25, 2013
Use of Estimates
I use estimates for looking at some aspects of valuing the current stock price. I think that is valid as stock prices tend to move depending on what investors think that the future holds rather than what the future really holds.
For example, to test whether or not a stock price is reasonable or not, I use the estimates, especially the EPS estimates. So my stock price testing using the Price/EPS and using the Price/Graham Price Ratios use estimates. (My stock price testing using the Price/Book Value per share Ratio and the current dividend yield uses no estimates.)
After at least the first quarterly report, I can start to compare the estimates by analysts to what the company is really doing. For example, on Canadian Utilities Ltd, I find that the analysts are calling for a 6.57% increases in EPS in 2013. After the 2nd Quarterly report is in, I find that the EPS for the year ending year ending at the 2nd Quarter, the EPS are up 8.76% compared to the year ending in 2012. This shows that the analysts are probably on the right track in their EPS estimates.
On my other blog I am today writing about Canadian Utilities Ltd (TSX-CU, OTC-CDUAF)...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
For example, to test whether or not a stock price is reasonable or not, I use the estimates, especially the EPS estimates. So my stock price testing using the Price/EPS and using the Price/Graham Price Ratios use estimates. (My stock price testing using the Price/Book Value per share Ratio and the current dividend yield uses no estimates.)
After at least the first quarterly report, I can start to compare the estimates by analysts to what the company is really doing. For example, on Canadian Utilities Ltd, I find that the analysts are calling for a 6.57% increases in EPS in 2013. After the 2nd Quarterly report is in, I find that the EPS for the year ending year ending at the 2nd Quarter, the EPS are up 8.76% compared to the year ending in 2012. This shows that the analysts are probably on the right track in their EPS estimates.
On my other blog I am today writing about Canadian Utilities Ltd (TSX-CU, OTC-CDUAF)...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
Monday, September 23, 2013
Living Well
This is not really a difficult subject. What you need to live well is happiness, well-being and financial security.
Happiness deals with the fact that you need
Well-being has to do with having a proper balance died and exercise. This amounts to generally taking care of yourself physically.
The financial security has to do with controlling debt and spending and putting something aside for a rainy date and retirement. Your savings can be in an account, CIGs, or invested in stocks, bonds, Mutual funds, ETFs, etc. For money in retirement you also might be part of a pension plan or get CPP and or OAS.
On my other blog I am today writing about Linamar Corporation (TSX-LNR, OTC-LIMAF) ...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
Happiness deals with the fact that you need
- Something to do
- Something to hope for
- Someone(s) to love
Well-being has to do with having a proper balance died and exercise. This amounts to generally taking care of yourself physically.
The financial security has to do with controlling debt and spending and putting something aside for a rainy date and retirement. Your savings can be in an account, CIGs, or invested in stocks, bonds, Mutual funds, ETFs, etc. For money in retirement you also might be part of a pension plan or get CPP and or OAS.
On my other blog I am today writing about Linamar Corporation (TSX-LNR, OTC-LIMAF) ...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
Friday, September 20, 2013
Good Times, Bad Times
Why is that we accept the good times, but in bad times we want to find someone to blame? This is extremely self-defeating. There is always going to be both good times and bad times or economic expansions and economic contractions. We would be better off if in the good times, we prepare for the next coming bad time.
On my other blog I am today writing about K-Bro Linen Inc. (TSX-KBL, OTC-KBRLF) ...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
On my other blog I am today writing about K-Bro Linen Inc. (TSX-KBL, OTC-KBRLF) ...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
Wednesday, September 18, 2013
Dividend Payout Ratios
Most important question to ask on dividend paying stock: "Can the level of dividends be sustained?" Also, once you have a company, you need to focus also on its ability to pay their dividend rather than on the stock price. I have found that the value of my portfolio has fluctuated a lot, but my dividend income has not. In fact, my dividend income has only increased since I held a basket of dividend paying stock.
If you just concentrate on your portfolio value, it might drive you crazy and you might just sell when you should not. I have found that in recession, some companies cut or eliminate dividends, some keep them level and other increase them. Overall, my dividend income has still increased. So, what you should be looking at is cash flow. When you look at dividend cash flow, you have to look at it over a 3 month period to get Cycle 1 to 3 of dividend payments. Or, you can look at dividend cash flow over a 12 month period.
Of course, when a company I own cuts or eliminates dividends, I check on the long term viability of the company. You have to ask yourself if you should buy more, sell some or all or just hold on a stock on such a company.
I look at Dividend Payout Ratios based on earnings and on cash flow. If I see some problems I might investigate the company further. I know that some analysts look at DPR based on Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO) and Free Cash Flow.
I look at such things sometimes on a short term basis and for REITS, but I do not like to do this on a long term basis for a company. When a company cannot provide a positive EPS higher than the dividend over the long term, it suggests to me that the company is mortgaged to the hilt and not a good long term buy. You should be aware that there are many analysts that seem to disagree with this.
Getting back to my main theme, it is all about whether or not a company can afford to pay their dividends. A company's ability to pay dividends will ultimately lead to higher stock prices over time.
The Investopedia site, is a good site to get some basic information and they concentrate on a DPR based on Earnings. See Investopedia. As I had already said, I look at DPR for both Earnings per Share (EPS) and Cash Flow. If I see problems, I look beyond this on an individual stock basis. Also, for REITs, I look at a DPR on Funds from Operations (FFO). (I used to also look at FFO for the old income trust companies.)
Dividend payout ratios vary widely among companies. Stable, large, mature companies (like TSX-BCE or TSX-TRP) tend to have larger dividend payouts. However, with a more growth-oriented company it will tend to keep their cash for expansion purposes, have modest payout ratios. This would be companies like Saputo (TSX-SAP). In fact a lot of consumer stocks have low payout ratios.
Also, dividends are paid with cash and not with earnings. This is why a lot of analysts check the dividend payments against things like Free Cash Flow. See Investopedia for a definition of Free Cash Flow per Share. Others check the dividends against Funds from Operations (FFO) or Adjusted Funds from Operations (AFFO). For a definition on FFO see Investopedia and also Investopedia for a definition of AFFO.
For an example of calculating FFO, see Investing Answers. This site also discusses the difference between FFO and AFFO. Some REITS pay as high as 90% of the FFO in distributions, but others keep the ratio lower (say 60%). If a REIT is paying 90% of the FFO, it is basically paying all its profits in distributions.
Analysts talk about DPR for Earnings at 60% and below and DPR for Free Cash Flow at 80% and below and 40% or lower for Cash Flow. However, now of this is written in stone, as different industries have different standards. You might want to compare any company with DRRS for similar companies. Note that the best companies have cash flows that are higher than earnings.
In the Investing Daily blog is an article on why you should use cash flow values in your DPR. See Investing Daily. There is a recent article in the G&M. This article talks about dividend sustainability and appropriate dividend payout ratios.
There are sorts of perspectives on this ratio and all sorts of blogs mentioning this ratio. See these articles by Million Dollar Journey, Dividend Money, The Market Capitalist and Dividend Ninja, Motley Fool.
On my other blog I am today writing about HNZ Group Inc. (TSX-HNZ.A, OTC-CDHPF)...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
If you just concentrate on your portfolio value, it might drive you crazy and you might just sell when you should not. I have found that in recession, some companies cut or eliminate dividends, some keep them level and other increase them. Overall, my dividend income has still increased. So, what you should be looking at is cash flow. When you look at dividend cash flow, you have to look at it over a 3 month period to get Cycle 1 to 3 of dividend payments. Or, you can look at dividend cash flow over a 12 month period.
Of course, when a company I own cuts or eliminates dividends, I check on the long term viability of the company. You have to ask yourself if you should buy more, sell some or all or just hold on a stock on such a company.
I look at Dividend Payout Ratios based on earnings and on cash flow. If I see some problems I might investigate the company further. I know that some analysts look at DPR based on Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO) and Free Cash Flow.
I look at such things sometimes on a short term basis and for REITS, but I do not like to do this on a long term basis for a company. When a company cannot provide a positive EPS higher than the dividend over the long term, it suggests to me that the company is mortgaged to the hilt and not a good long term buy. You should be aware that there are many analysts that seem to disagree with this.
Getting back to my main theme, it is all about whether or not a company can afford to pay their dividends. A company's ability to pay dividends will ultimately lead to higher stock prices over time.
The Investopedia site, is a good site to get some basic information and they concentrate on a DPR based on Earnings. See Investopedia. As I had already said, I look at DPR for both Earnings per Share (EPS) and Cash Flow. If I see problems, I look beyond this on an individual stock basis. Also, for REITs, I look at a DPR on Funds from Operations (FFO). (I used to also look at FFO for the old income trust companies.)
Dividend payout ratios vary widely among companies. Stable, large, mature companies (like TSX-BCE or TSX-TRP) tend to have larger dividend payouts. However, with a more growth-oriented company it will tend to keep their cash for expansion purposes, have modest payout ratios. This would be companies like Saputo (TSX-SAP). In fact a lot of consumer stocks have low payout ratios.
Also, dividends are paid with cash and not with earnings. This is why a lot of analysts check the dividend payments against things like Free Cash Flow. See Investopedia for a definition of Free Cash Flow per Share. Others check the dividends against Funds from Operations (FFO) or Adjusted Funds from Operations (AFFO). For a definition on FFO see Investopedia and also Investopedia for a definition of AFFO.
For an example of calculating FFO, see Investing Answers. This site also discusses the difference between FFO and AFFO. Some REITS pay as high as 90% of the FFO in distributions, but others keep the ratio lower (say 60%). If a REIT is paying 90% of the FFO, it is basically paying all its profits in distributions.
Analysts talk about DPR for Earnings at 60% and below and DPR for Free Cash Flow at 80% and below and 40% or lower for Cash Flow. However, now of this is written in stone, as different industries have different standards. You might want to compare any company with DRRS for similar companies. Note that the best companies have cash flows that are higher than earnings.
In the Investing Daily blog is an article on why you should use cash flow values in your DPR. See Investing Daily. There is a recent article in the G&M. This article talks about dividend sustainability and appropriate dividend payout ratios.
There are sorts of perspectives on this ratio and all sorts of blogs mentioning this ratio. See these articles by Million Dollar Journey, Dividend Money, The Market Capitalist and Dividend Ninja, Motley Fool.
On my other blog I am today writing about HNZ Group Inc. (TSX-HNZ.A, OTC-CDHPF)...continue...
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my site for an index to these blog entries and for stocks followed. Follow me on Twitter.
Tuesday, September 17, 2013
Kathleen's Show - Transformations 2013
My friend Kathleen with her friends Ethel Christensen, Ulla Djelweh and Wenda Watt is having an art show called Transformations 2013 stating on October 4, 2013.
The show is at the Women's Art Association, Dignam Gallery at 23 Prince Arthur Avenue. Phone is 416-922-2060. This Gallery is near the St. George Subway Station, Bedford Exit.
The Opening Reception is on Friday October 4, 2013 between the hours of 6 and 9 pm. The Closing Reception is on Friday, October 11, 2013 between the hours of 6 and 9 pm.
Viewing between receptions is by appointment and on Saturday October 5, 2013 and Saturday October 12, 2013 between the hours of 1 to 4 pm.
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