Sunday, May 24, 2015

Weekend Reading Links - May 24, 2015

For your weekend reading pleasure, the articles listed below contain some of the best dividend and value investing insights found on the web. They were written by various members of the Dividend Investing and Value Network over the past week:


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Saturday, May 23, 2015

Microsoft – a Little bit Late for the Party, Still Growth to Come from the Clouds

Microsoft is the best known and most important software company in the world. Along with its famous line of software products, Microsoft also offers various services such as servers (including cloud systems), business solutions (support and consulting), entertainment (Xbox) and other online services.stock report
-Seven Year Revenue Growth Rate: 9.71%
-Seven Year EPS Growth Rate: 8.23%
-Seven Year Dividend Growth Rate: 12.56%
-Current Dividend Yield: 2.55%
-Balance Sheet Strength: Strong

Overview

We all know Microsoft for their Windows operating system and Office Suite. At several occasions in time, we have seen competitors try to steal market share away from the giant. I remember watching an interview with the Microsoft CEO years ago and the reporter asked if he was concerned about the rise of Linux.
Linux what? He answered
I was surprised to see MSFT’s big boss not even consider that a competitor could hurt Windows’ market share. Today, I understand that there is not many competitors can do to battle with the “mother” of computers.


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Friday, May 22, 2015

Four Companies Growing Future Yields With Increased Dividends

I try to assemble my dividend portfolio by mixing three distinct types of dividend growth stocks. The first group consists of higher yielding companies which have lower dividend growth expectations. The second group includes companies in the sweet spot, which have average yields anywhere around 2.50% - 4% and average to above average dividend growth. The third group includes companies which have lower current yields, but offer the possibility of high dividend growth. When combining expected dividend growth with current yields, I determine the type of company I am reviewing, and also decide whether it is worth pursuing at some point in the future. I uncover those companies by screening the list of dividend champions or by reviewing the list of dividend increases for the week. I also use my process of reviewing recent dividend increases to monitor the performance of any companies I already own.

There were five companies last week I decided to review briefly in this blog post. I focused on the companies with at least a ten year streak of dividend growth and the right mix between dividend yield and dividend growth:


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Thursday, May 21, 2015

Recent Buy - Union Pacific

I’m incredibly fortunate to stay busy on the stock purchasing front, with May being a blockbuster month in terms of fresh capital deployment.
Most of my attention this month has been focused on REITs, adding to my positions inW.P. Carey Inc. (WPC) very early in the month and then just a day later Omega Healthcare Investors Inc. (OHI). I think both stocks are trading at reasonable valuations here with extremely appealing combinations of yield and growth.
Interest rates, corrections, and currencies! Oh my! I keep hearing about all of it. Yet I continue to regularly invest and turn cash into its far more interesting and superior cousin, cash flow. If you let the noise distract you from focusing on what you can control, you’ve already lost the battle. Don’t let Mr. Market bully you around.
But REITs aren’t the only game in town. And I had a few other high-quality stocks on my watch list for May. I decided to deploy what cash I had left for the rest of the month into a stock I’ve long wanted to get my hands on.
I purchased 10 shares of Union Pacific Corporation (UNP) on 5/6/15 for $106.43 per share and an additional 5 shares on 5/13/15 for $102.29 per share.


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