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Posted by Martin May 12, 2013
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My inspiration in the last week #21

My inspiration in the last week #21

This week I would like to present the following interesting web sites and links.

I often browse the internet to find ideas about investing, trading stocks, options, investing opportunities and strategies. I like to read about investors and what their investing/trading approach to create income you can live on is.

 

 
 




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Posted by Martin May 10, 2013
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Dividend paying stocks attractive to buy today


Today’s trading session brought a couple of stocks I own in my TD and ROTH IRA accounts which reversed enough to be once again attractive to buy or in other words: to add to my portfolio.

PPL Corporation is an energy and utility holding company. The Company operates in four segments: Kentucky Regulated, U.K. Regulated, Pennsylvania Regulated and Supply. Through its subsidiaries, PPL generates electricity from power plants in the northeastern, northwestern and southeastern United States; markets wholesale or retail energy primarily in the northeastern and northwestern portions of the United States; delivers electricity to customers in Pennsylvania, Kentucky, Virginia, Tennessee and the United Kingdom, and natural gas to customers in Kentucky. As of December 31, 2012, the Company’s subsidiaries were PPL Energy Supply, LLC (PPL Energy Supply), PPL Electric Utilities Corporation (PPL Electric), LG&E and KU Energy LLC (LKE), PPL Global, LLC (PPL Global), PPL EnergyPlus LLC (PPL EnergyPlus), PPL Generation LLC (PPL Generation), Louisville Gas and Electric Company (LG&E) and Kentucky Utilities Company (KU).

The stock corrected significantly from its top, see the chart

PPL

The stock paid and increased dividend for 13 consecutive years. It increased its dividend to $0.367500 (2.1% increase) and its current yield is 4.60%. The 5yr dividend growth rate for this company is 3.01%.

My calculated fair value is $35 a share and thus the company is currently trading below my fair value. The company has a very aggressive expenditure plan which can provide a solid base for 8% compound annual growth rate. Circa 65% of power generation is realized via a low cost power plants, which provides an edge for PPL for an eventual increase in power prices. The expenditure plan ($17.4 billion) may however provide a significant pressure to future dividends (also refer to company’s negative cash flow).

A negative free cash flow in many cases is not bad in itself. It could be a sign that a company is making large investments and if these investments earn a high return, the strategy has the potential to pay off in the long run.

Conclusion

I own PPL in my ROTH IRA account and I have owned for several years enjoying sustainable dividends and I plan to own this company for a long term run. If you want to add this company to your portfolio, I would apply a contingency order strategy to enter into a position. The stock has been falling for 7 consecutive days and today it broke below 50 day MA. This may be the end of the correction in this stock, as well as we still may see a further downside pressure. The next support for this stock is at $30 a share and $28 a share and we may see the stock re-testing one of these levels prior to reversing the trend.

 




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Posted by Martin May 09, 2013
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Supper quicky note #8


Yesterday I was quite disappointed with the market and my account results.

I made MONEY!

I made a good chunk of money yesterday. So why I am disappointed? Because the market was running up again, extending its over bought status and creating a bubble once again. Maybe not that big bubble we saw a few years ago, but the fall and panic which will follow this will once again be large.

I can hear all the talking heads already saying something about the end of the world.

I am crazy!




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Posted by Martin May 06, 2013
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April gone, Yakezie up!


Proud Member of YakezieI realized I became obsessed with Yakezie challenge. Although I am tired I still strive to publish posts which hopefully can add value to my readers and show them my progress from money wasting sucker to a successful dividend investor and at the same time browsing other blogs, reading, responding and promoting them.

The obsession went thus far that I am tracking my Alexa rank and I can even create a graph indicating the progress. This turns me into a crazy person. However this is my trait a part of me and I do this almost with everything. I start tracking and recording every part of my life which matters to me.

When I was a kid, I tracked my allowance saving in the same way. My mom told me that I was as greedy as her brother, my uncle, who was doing the same thing his whole life. Now I know she meant it as a compliment :)

That reminds me a sequence from the move “Trading Places” where Mortimer tells the exact thing to his brother Randolph, that their mother told him that he was greedy and money is not everything. Randolph responded that she meant it as a compliment.

As April is gone, my Yakezie rank progressed to 258,798.

I joined the Yakezie challenge on March 1 with a starting rank of 1,798,936. Two months later I am almost at the limit to become a Yakezie member.

For that I want to thank to all my readers and visitors of this blog. Thanks for stopping by, reading my posts and commenting. I like comments from you and I am like a little child when seeing new comments pending for approval.

So once again, here is my huge THANKS to you!
 
 




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Posted by Martin May 05, 2013
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My inspiration in the last week #20

My inspiration in the last week #20

This week I would like to present the following interesting web sites and links.

I often browse the internet to find ideas about investing, trading stocks, options, investing opportunities and strategies. I like to read about investors and what their investing/trading approach to create income you can live on is.

 

 
 




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Posted by Martin May 01, 2013
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Supper quicky note #7


The beginning of May started with a sell off in the markets. The talking heads are placing their bets whether this is a beginning of a long anticipated correction or whether the buyers step in and start buying tomorrow. Well, the after market and futures are pointing to rising markets tomorrow. But that can change.

Others are questioning whether the stock market will be or will not be affected by FOMC meeting or recent FED chairman’s comments about FED’s monetary policy.

Another group is mentioning the traditional sell off in May (I bet you know the adage “Sell in May and walk away”) and whether it is the same case as last year and the year ago when markets actually dropped significantly in May and this will repeat again.

So, what do you think? Is the old saying going to materialize and investors start selling their assets in May?

From the dividend growth investor’s perspective, I am not selling anything and if those crazy guys out there start panicking and selling like crazy, I will gladly pick up their “trash” and add it to my portfolio.




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Posted by Martin April 30, 2013
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Trade adjustment – Pitney Bowes Inc. (PBI) put rollover

Trade adjustment - Pitney Bowes Inc. (PBI) put rollover

Today Pitney Bowes cut their dividend by 50%. That makes this stock no longer attractive for my dividend growth strategy and I am no longer interested in this stock.

Originally I sold a put contract to get assigned to the stock. I no longer wish to be assigned and since I do not know how deep the stock may fall, I decided to roll over the put down and further in time. I will continue doing this as long as I will be safe and be able to let the put expire worthless.

Trade detail

04/30/2013 12:15:09 Sold 1 PBI Jan 18 2014 12.0 Put @ 1.22
04/30/2013 12:15:09 Bought 1 PBI Jul 20 2013 14.0 Put @ 1.31

This trade gives me more time to deal with it, lowers the strike price from $14 to $12 (which is safer, but still not a guarantee of not beign assigned) and still keeps this trade profitable leaving me with $70 profit (without commissions).




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Posted by Martin April 30, 2013
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Supper quicky note #6


Again, the market ran up yesterday in amazing session. It added to its overbought state and today we are correcting from yesterday’s run. Well, it doesn’t mean that this is the beginning of a bigger drop, but it may become one.

The market stalled at its crucial top marked on April 11, 2013 and now we are awaiting if it goes over the top (break the resistance) or this will be the first day marking lower high and thus potential reverse in trend.

However institutional money are still moving funds from bonds and other markets into equities and it is said that retail investors are still mostly sitting aside, so most likely, this trend isn’t over yet. At least this is what I have read in the news. Who knows. These days it is not much advisable trusting the media.

In the morning the market swung down from 159 opening all the way down to 128 and recovered most of the morning loses.

 

 

A stock I was interested in recently was Pitney Bowes. I was OK to own the stock, but I didn’t want to buy out right. So I decided to sell a put contract to get assigned into the stock. Here you can see my trade details of PBI put selling

Today the company announced 50% reduction in dividends to pay its debt. Although it is a good move in my opinion, it removes this stock from a list of candidates for my dividend growth money machine.

That said, I am no longer interested in this stock and I will do all it takes to let the put option expire worthless.




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Posted by Martin April 28, 2013
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My inspiration in the last week #19

My inspiration in the last week #19

This week I would like to present the following interesting web sites and links.

I often browse the internet to find ideas about investing, trading stocks, options, investing opportunities and strategies. I like to read about investors and what their investing/trading approach to create income you can live on is.

 

 
 




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