I added to my position in the large US drugstore chain Walgreen (WAG) yesterday. I have held this position for a few years now and I saw the recent severe weakness in the stock as an opportunity to lower my adjusted cost base.
Walgreen is down over 28% year to date versus 6.5% for the S&P 500 index. The stock is trading at a 52 week low sporting a P/E ratio of 12.7x earnings and a price to sales ratio of 0.40. This is a low debt, high return on equity company who in my opinion is catering to the right demographic. Drug cycles etc. will always effect their profitability but in the long term they will reap the rewards of being a convenient choice for an aging population.
Wednesday, June 30, 2010
Monday, June 28, 2010
globe & mail mention / new look!
The best newspaper in Canada chose to feature my boring story once again. I was in the Globe & Mail almost 3 years ago telling the same old lame dividend growth story. They might as well write the story now for publishing in three years time again because it likely won't change.
Aahhhh.......it never gets old......
Also some things do change as I've changed the design of the website. Please let me know what you think of our new look. Thanks.
Aahhhh.......it never gets old......
Also some things do change as I've changed the design of the website. Please let me know what you think of our new look. Thanks.
Wednesday, June 9, 2010
Sunday, June 6, 2010
capitalism, a love story review
Finally last night I was able to see the Michael Moore documentary Capitalism, A Love Story. Going into the movie I obviously knew that I would disagree with his stance but I was looking forward to being entertained and at least considering his point of view. I have enjoyed some of Moore's prior pieces such as Bowling for Columbine, and Sicko. While I don't always agree with him he usually gets his points across eloquently and makes a good case, until now....
Moore really dropped the ball with this one and from the opening scene this movie lacked any kind of direction and failed to make one sound point against a capitalist system. Many of the long drawn out points that Moore made such as corporations taking out insurance policies against employee deaths really did nothing to prove the thesis. I found myself thinking to myself 'So What' after many of the points. Interviewing priests to let them lambaste capitalism is really going straight to the lowest common denominator. No offence to the religious but are Catholic priests really the authority on what financial system works best? I wouldn't ask my dry cleaner for real estate legal advice. This is just an insult of the viewer's intelligence.
Yes, everyone and their dog had their home taken from under them by the evil banks. Some companies were forced to close their doors because they couldn't make a profit or banks stopped lending them money to lose. A few select companies employ a democratic system where everyone has a stake in the company and decisions are made by committee. All this comes as little surprise and proves nothing. If one can't pay their mortgage for an extended period should they really get to keep their house? What would forgiving this solve? Some companies have discovered a way to keep everyone engaged and driven to earn a collective profit. How is this not capitalism? Why do they come to work each day?
Another huge 'So What' point is one that was made at length about pilots being underpaid. If this is truly the case then people will stop becoming pilots. Eventually they will start getting paid more because they will be in demand graduates. Should we artificially provide them subsidies in order for them to earn more? Should we tax these high earning Taco Bell managers more?
Also, many of the points made in the movie have since been weakened by recent events. Case in point the U.S. government actually made money on the bank bailout investments that they made. Also American, General Motors and Ford are now profitable companies and are both looking pretty solid against Japanese, Toyota who has stepped on themselves recently. These ebbs and flows are what Capitalism is all about. The drive to make money, succeed, and raise your quality of life has led to most of the greatest discoveries and human achievements in history. So the guy who discovered a polio vaccine shared it with the masses instead of profiting from it, good from him but again so what!
This movie was neither thought provoking nor entertaining and in my opinion it failed to make one solid point against a system that has made the great countries of today great.
Moore really dropped the ball with this one and from the opening scene this movie lacked any kind of direction and failed to make one sound point against a capitalist system. Many of the long drawn out points that Moore made such as corporations taking out insurance policies against employee deaths really did nothing to prove the thesis. I found myself thinking to myself 'So What' after many of the points. Interviewing priests to let them lambaste capitalism is really going straight to the lowest common denominator. No offence to the religious but are Catholic priests really the authority on what financial system works best? I wouldn't ask my dry cleaner for real estate legal advice. This is just an insult of the viewer's intelligence.
Yes, everyone and their dog had their home taken from under them by the evil banks. Some companies were forced to close their doors because they couldn't make a profit or banks stopped lending them money to lose. A few select companies employ a democratic system where everyone has a stake in the company and decisions are made by committee. All this comes as little surprise and proves nothing. If one can't pay their mortgage for an extended period should they really get to keep their house? What would forgiving this solve? Some companies have discovered a way to keep everyone engaged and driven to earn a collective profit. How is this not capitalism? Why do they come to work each day?
Another huge 'So What' point is one that was made at length about pilots being underpaid. If this is truly the case then people will stop becoming pilots. Eventually they will start getting paid more because they will be in demand graduates. Should we artificially provide them subsidies in order for them to earn more? Should we tax these high earning Taco Bell managers more?
Also, many of the points made in the movie have since been weakened by recent events. Case in point the U.S. government actually made money on the bank bailout investments that they made. Also American, General Motors and Ford are now profitable companies and are both looking pretty solid against Japanese, Toyota who has stepped on themselves recently. These ebbs and flows are what Capitalism is all about. The drive to make money, succeed, and raise your quality of life has led to most of the greatest discoveries and human achievements in history. So the guy who discovered a polio vaccine shared it with the masses instead of profiting from it, good from him but again so what!
This movie was neither thought provoking nor entertaining and in my opinion it failed to make one solid point against a system that has made the great countries of today great.
Thursday, June 3, 2010
Reitmans wears an 11% higher dividend
I am starting to get used to all of these dividend increases within our non-registered portfolio. After announcing strong earnings that beat expectations, Canadian clothing retailer Reitmans (RET.A) also declared an 11% dividend increase. I have held shares in Reitmans since December of 2007, which was just after their last dividend increase. It is nice to see them break the dry spell as their earnings have perked up again after the financial crisis.
I initiated my position in Reitmans as mentioned in December of 2007, just after their dividend raise to $0.18 per share. I bought the shares at $18.18. I also added during January of 2008 when I felt that the shares were dirt cheap at $15.57. In November of 2008 I also added some more shares at $12.00 as the credit crisis struck. I was a bit early as the shares did trade down to a ridiculous $8.61 the next month. Overall my adjusted cost base on the stock is $15.07. The shares currently trade at $18.27 and yield 4.4%.
I initiated my position in Reitmans as mentioned in December of 2007, just after their dividend raise to $0.18 per share. I bought the shares at $18.18. I also added during January of 2008 when I felt that the shares were dirt cheap at $15.57. In November of 2008 I also added some more shares at $12.00 as the credit crisis struck. I was a bit early as the shares did trade down to a ridiculous $8.61 the next month. Overall my adjusted cost base on the stock is $15.07. The shares currently trade at $18.27 and yield 4.4%.
Friday, May 21, 2010
Canadian Pacific dividend raise
Canadian Railway, Canadian Pacific (CP) has raised their dividend for the first time since early 2008. The increase was from $0.2475 to $0.27 per share, representing a hike of 9%. The stock yields about 1.9% on todays closing price.
Another increase for our portfolio; that's two in one week! I really like CP as an investment long term as China reaches for Canadian resources.
Another increase for our portfolio; that's two in one week! I really like CP as an investment long term as China reaches for Canadian resources.
Wednesday, May 19, 2010
Clorox ups dividend
Consumer products firm Clorox (CLX) has hiked it's quarterly dividend 10% to $0.55 per share. This is another dividend hike for our non-registered portfolio. Our income from investments continues it's climb into new records.
Lately we have recieved raises from:
Clorox
Johnson & Johnson
Procter & Gamble
Diageo
Telus
Canadian Oil Sands Trust
Sysco
and hints from...
Scotts Miracle Gro
GE
Lately we have recieved raises from:
Clorox
Johnson & Johnson
Procter & Gamble
Diageo
Telus
Canadian Oil Sands Trust
Sysco
and hints from...
Scotts Miracle Gro
GE
Saturday, May 15, 2010
net worth, may '10
It's time to report my bimonthly net worth. This particular report (May) is what I call my 'fiscal year', as I began tracking net worth in May of 2006.
Net worth results for the 2 Months Ended May 15, 2010:
Net worth results for the 2 Months Ended May 15, 2010:
- Debt/Asset ratio dropped to 0.46 from 0.44 (a record low)
- Net Worth rose 3.3% (to a record high)
- Total Assets rose 0.6% (to a record high)
- Total Liabilities shrunk by 2.6%
- House Value/Total Assets fell to 58.9% (a record low)
- Non-Registered Portfolio grew 4.5% (to a record high)
*note results may not make sense with my last report as I revalued our home to a recently appraised value.
2010 Calendar Year to Date Gain/Loss: +8.8%
2009 Fiscal Year Gain/Loss: +29.1%
So now it has been 4 full years since I started tracking our net worth and we have come a long way. Here are our net worth increases through the years:
2006 = 96.8%
2007 = 39.9%
2008 = 4.8% (the markets crashed but we still managed to eek out a gain)
2009 = 29.1%
This brings us to today where our all of our metrics are sitting at record levels with the exception of our liabilities which are only $3,000 from a record level. The single metric that I probably pay the most attention to is our debt/asset ratio which started out at a whopping 0.77 in 2006 and now sits at 0.44. Our debt is now at a very manageable level when compared to our assets and incomes, which is a good feeling. Going forward we will be putting even greater emphasis on growing assets and less emphasis on reducing debt as we reduce our mortgage payments and continue to invest a good deal of our savings.
Sunday, May 9, 2010
Scotts to grow dividend
Scotts Miracle Gro (SMG) is a company which dominates their industry probably more than any other firm that I can think of. I don't post much about the stock which makes up a very small percentage of my portfolio, but their recent earnings report is worth noting and it came with a special bonus.
Scotts reported EPS of $1.80 compared with a the street's expectation of $1.46 and last year's $1.25. They also raised their full year guidance to $3.25+ from previous guidance of $3.00-$3.10. The special bonus was that the company stated on a call with analysts that they have a bias toward a share repurchase program and a dividend increase later in the year. This is great news for shareholders as Scotts' dividend has been at the same level since they introduced it in 2005. The stock only yields 1% currently.
The company seems to be on a roll recently as a major competitor left the market and North Americans have prioritized their lawns & gardens in the last year as money has become tight. I see gardening as a long term trend that will only become more popular as demographics change. Scotts Miracle Gro's strength lies in their savvy marketing, category domination, and decisive management.
Scotts reported EPS of $1.80 compared with a the street's expectation of $1.46 and last year's $1.25. They also raised their full year guidance to $3.25+ from previous guidance of $3.00-$3.10. The special bonus was that the company stated on a call with analysts that they have a bias toward a share repurchase program and a dividend increase later in the year. This is great news for shareholders as Scotts' dividend has been at the same level since they introduced it in 2005. The stock only yields 1% currently.
The company seems to be on a roll recently as a major competitor left the market and North Americans have prioritized their lawns & gardens in the last year as money has become tight. I see gardening as a long term trend that will only become more popular as demographics change. Scotts Miracle Gro's strength lies in their savvy marketing, category domination, and decisive management.
Friday, May 7, 2010
wtf
Whatever happened at around 2:45pm on Thursday, May 6 was definitely interesting for anyone who follows the stock markets closely. I got back in my office after a birthday gathering for a coworker, and the first thing I noticed was that the Canadian utility Fortis (FTS), which is part of my portfolio, was down about 35%!
My first thought was that Google Finance was acting up as I have seen before. Next I noticed that Inter Pipeline Fund (IPL.UN) which I also hold was down by a catastrophic amount as well. After I saw this I quickly browsed over the the Financial Webring Forum where my fellow investors were already chatting about the Fortis situation. I then signed into my account at BMO Investorline to see if I could buy Fortis at $17/share, but the stock was up to $26. The day's low did read around $16 so this made me think that this drop was actually legit which boggled my mind. I then started seeing the reports on Google Finance and the Financial Webring about how this event was erroneous and trades will probably be cancelled. Kinda makes me glad that I don't believe in stop losses.
An interesting video clip to watch is CNBC personality Jim Cramer live seeing Procter & Gamble fall to $45 per share and calling it as a market error.
http://www.youtube.com/watch?v=2BQ0-194Igs
My first thought was that Google Finance was acting up as I have seen before. Next I noticed that Inter Pipeline Fund (IPL.UN) which I also hold was down by a catastrophic amount as well. After I saw this I quickly browsed over the the Financial Webring Forum where my fellow investors were already chatting about the Fortis situation. I then signed into my account at BMO Investorline to see if I could buy Fortis at $17/share, but the stock was up to $26. The day's low did read around $16 so this made me think that this drop was actually legit which boggled my mind. I then started seeing the reports on Google Finance and the Financial Webring about how this event was erroneous and trades will probably be cancelled. Kinda makes me glad that I don't believe in stop losses.
An interesting video clip to watch is CNBC personality Jim Cramer live seeing Procter & Gamble fall to $45 per share and calling it as a market error.
http://www.youtube.com/watch?v=2BQ0-194Igs
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