Merck / SGP: Will the Pharma Megamergers Continue? [View article]
The market voted on the unwisdom of the deal for MRK shareholders, sending MRK down almost 8%. I suspect MRK will now cut their dividend, and the shares will be further pulverised in response. Managements and boards are failing to realise that the dividend is the most important reason to own a share in any company over the next few years, as the expectation of stock appreciation is no longer sufficient.
Very foolish of MRK's management to pay such a premium for SGP, and exceptionally irresponsible to pay such a large percentage in cash. In this environment, cash should be conserved to support the dividend. They have not learned from the DOW/ROH debacle, nor from the decimation of PFE's shares following their equally reckless buyout of WYE and dividend cut.
12 Attractive Companies That Also Pay a Dividend [View article]
I thought NOK just "suspended" their dividend.
Now that cutting dividends is de rigeur, even companies that don't need to cut them will jump on the bandwagon and take cover in the fact that others are cutting. Executives want all the available cash to buy back shares, so that their options can come back into the money. Paying dividends to the owners (i.e. the shareholders) is too old-fashioned, as it reduces the executives' loot, disguised as options.
On Mar 01 11:56 AM YoMama wrote:
> JNJ and NOK might be the safest payers on this list. Three more to > consider is PG,KFT and MCD for safety and regular increases. If you > put stock price movements above the dividends in importance your > better off staying in cash .
Barron's: Best Dividend Plays for 2009 [View article]
Do you really think the WHR dividend is "reasonably secure"!? How about the pharmas? PFE just halved theirs, so how can you be sure that BMY or MRK or others will not? How about tobacco, where we have glimpses of potential new litigation? You already mentioned that T and VZ may be at risk due to high payout ratios, so I will not add them here.
Bottom line is that very few are "reasonably secure". Even those that should be, really are not, since crony boards prefer to cut dividends before they touch executive compensation. After all, the recent business model has become that the real owners of a company, the shareholders, always get short shrift, while their employees (the management) busily reward themselves with the shareholders' money. This sorry state of affairs is an additional discount factor you have to apply when investing in dividend stocks.
S&P 500 Dividend Aristocrats: Past, Present and Future [View article]
I had a position in KO for some years and was satisfied with the stock's performance. However, when it got to the mid-60's, I thought it was much too high and sold it and bought higher yielding stocks instead.
Part of my reasoning was that the novelty of people buying bottled water, instead of drinking it from a tap or fountain, will fade because (a) unnecessary spending in a recession,(b) articles in various media claimed that bottled water is no better than tap water, (c) uses lots of energy to make bottles and transport them, and (d) it was a silly fad anyway.
I confess I did not look into what percentage of KO profits came from selling water in bottles, but assumed it is significant as you see their water everywhere, and being more expensive than coke must be highly profitable.
Merck / SGP: Will the Pharma Megamergers Continue? [View article]
Very foolish of MRK's management to pay such a premium for SGP, and exceptionally irresponsible to pay such a large percentage in cash. In this environment, cash should be conserved to support the dividend. They have not learned from the DOW/ROH debacle, nor from the decimation of PFE's shares following their equally reckless buyout of WYE and dividend cut.
(disclosure: own shares in MRK, SGP, PFE and WYE)
12 Attractive Companies That Also Pay a Dividend [View article]
Now that cutting dividends is de rigeur, even companies that don't need to cut them will jump on the bandwagon and take cover in the fact that others are cutting. Executives want all the available cash to buy back shares, so that their options can come back into the money. Paying dividends to the owners (i.e. the shareholders) is too old-fashioned, as it reduces the executives' loot, disguised as options.
On Mar 01 11:56 AM YoMama wrote:
> JNJ and NOK might be the safest payers on this list. Three more to
> consider is PG,KFT and MCD for safety and regular increases. If you
> put stock price movements above the dividends in importance your
> better off staying in cash .
Barron's: Best Dividend Plays for 2009 [View article]
Bottom line is that very few are "reasonably secure". Even those that should be, really are not, since crony boards prefer to cut dividends before they touch executive compensation. After all, the recent business model has become that the real owners of a company, the shareholders, always get short shrift, while their employees (the management) busily reward themselves with the shareholders' money. This sorry state of affairs is an additional discount factor you have to apply when investing in dividend stocks.
S&P 500 Dividend Aristocrats: Past, Present and Future [View article]
Part of my reasoning was that the novelty of people buying bottled water, instead of drinking it from a tap or fountain, will fade because (a) unnecessary spending in a recession,(b) articles in various media claimed that bottled water is no better than tap water, (c) uses lots of energy to make bottles and transport them, and (d) it was a silly fad anyway.
I confess I did not look into what percentage of KO profits came from selling water in bottles, but assumed it is significant as you see their water everywhere, and being more expensive than coke must be highly profitable.