Coca Cola stock has been on a bit of a bull run lately, and is now over $80/share.
It’s kind of a shame in a certain sense; I’d love to pick up more shares at the right price. Value investors of course want stock values to be low while the underlying company performance is strong, so that reinvested dividends, or fresh capital, or even the company’s own share buybacks, are able to buy more shares.
I wouldn’t exactly call it overvalued; with a 2.5% dividend yield and over 8% dividend growth, its current earnings multiple of over 20 isn’t in bubble territory. But for 9-11% annualized returns or so, there isn’t any margin of safety. I’d look for dips back into the mid-$70′s before buying more of this company.
Poll Results
This week I ran a simple five-question poll for readers, and I appreciate you all for giving around 200 responses to it. It’s anonymous of course, but I have the statistics to share with you.
Age of Investors
I was interested to see in the poll that the age distribution follows a two-peak curve. The most common age group on the site is 30-39, with 27% of readers being in that age bracket. The second most common age bracket is the 60-69 age bracket, at 24%. Those are the two peaks. In third place is the 19-29 age bracket, with 19%. At 10% each, are the 40-49 and 50-59 age brackets. 9% of readers are 70 or better, while 1% of readers are under 18.
I was interested to see in the poll that the age distribution follows a two-peak curve. The most common age group on the site is 30-39, with 27% of readers being in that age bracket. The second most common age bracket is the 60-69 age bracket, at 24%. Those are the two peaks. In third place is the 19-29 age bracket, with 19%. At 10% each, are the 40-49 and 50-59 age brackets. 9% of readers are 70 or better, while 1% of readers are under 18.
Those are some interesting results. Thirty-somethings and sixty-somethings have the biggest readership here, but investors in their forties and fifties are a bit under-represented. I expected this to follow more of a traditional bell curve, with lots of people in their 30′s and 40′s, and fewer people in their 20′s, 50′s, and maybe a spike in the 60′s because those are retirement years and people are looking to transition wealth towards solid income streams.
I am happy to see so many investors in their 20′s.
What is your primary investing goal?
I loved the answers to this. Most of them were along these lines.
I loved the answers to this. Most of them were along these lines.
“Create a large enough cash flow to retire in 15 years.”
“Stable incoming cashflow in 15-20 years.”
“My strategy entails purchasing high quality dividend growth stocks.The goal of my dividend growth portfolio is to purchase stocks that will raise dividends for years, without me having to reinvest anything back. The stream of dividend income will be used to fund my retirement, while the dividend growth will provide protection against inflation.”
“Financial independence”
“self sufficient retirement”
“Retirement income”
“Establish a reliable, growing income stream for early retirement.”
“Generate enough income to be financially independent”
“to build a portfolio that generates enough capital/income to sustain my needs and moderate wants to the end of my life, and leave some financial legacy for my kids”
“To be able to live of dividends, and use salary as pocket money.”
And one of the most concise ones:
“money”
How optimistic are you about the global economy and investing returns, on a scale of 1-5, with 5 being very optimistic?
5% voted 1
12% voted 2
38% voted 3
37% voted 4
8% voted 5
5% voted 1
12% voted 2
38% voted 3
37% voted 4
8% voted 5
I was slightly surprised by this. I expected a lot of 2′s and 3′s, some 4′s, and fewer 1′s and 5′s. But instead, there are more 4′s than I thought, and fewer 2′s than I thought. I think perhaps it’s because I phrased the question awkwardly. The performance of the global economy and investing returns are not necessarily correlated, especially when it comes to companies that pay strong dividends.
Chubb Corporation, as an example of one of my holdings, hasn’t grown revenue in years but they’ve doubled investor’s money in 7 years due to good use of capital.
How many individual stocks do you own?
Answers ranged from 0 to over 100, and everything in between. Numbers between 5 and 25 were the most common.
Answers ranged from 0 to over 100, and everything in between. Numbers between 5 and 25 were the most common.
Here was one answer:
“None at the moment-wait for Europe to come back from the dead.”
“None at the moment-wait for Europe to come back from the dead.”
Lastly, I asked what kinds of articles you find most useful, with multiple options allowed (so they total up to a lot more than 100%).
Unlike some of the other questions, this went exactly as I expected.
Unlike some of the other questions, this went exactly as I expected.
77% find the individual stock reports to the most useful.
71% find the list of stock ideas to be the most useful.
51% find investment tutorials to be the most useful.
33% find personal finance articles to be the most useful.
71% find the list of stock ideas to be the most useful.
51% find investment tutorials to be the most useful.
33% find personal finance articles to be the most useful.
This is what I have suspected, so I publish a stock analysis almost every week, and sometimes two. I post a list of ideas every two weeks or so. I create investment tutorials but I link to them regularly from other articles as cornerstone content instead of posting them often. I post a personal finance article once in a while, but leave 80% of that to the personal finance websites out there. I think most readers of this site already have their financial house in order, or know how to get it there.
Weekend Reading
Here are some good articles for the week:
Republic Services Looks Fair at $28
This was my stock report of the week. It landed as an Editor’s Pick on Seeking Alpha, which I appreciate. I plan on analyzing UPS next week.
This was my stock report of the week. It landed as an Editor’s Pick on Seeking Alpha, which I appreciate. I plan on analyzing UPS next week.
Philip Morris International Analysis
Dividend Growth Investor published a report on PM. It’s his single largest position, according to the article, but he’s also willing to add more.
Dividend Growth Investor published a report on PM. It’s his single largest position, according to the article, but he’s also willing to add more.
Mid Year 2012 Top and Bottom Performing Stocks
D4L has quite a large portfolio, and he posted his top 5 best performing and worst performing holdings of 2012. His worst performer was McDonald’s, and he said in response: “Pullbacks on great stocks are one of the things that make me smile.” Here was my June MCD report in response to the dip in price: McDonald’s Looks Fair Under $90
D4L has quite a large portfolio, and he posted his top 5 best performing and worst performing holdings of 2012. His worst performer was McDonald’s, and he said in response: “Pullbacks on great stocks are one of the things that make me smile.” Here was my June MCD report in response to the dip in price: McDonald’s Looks Fair Under $90
How to Invest in Gold
Passive Income Earner provides an overview. The only gold I own is a few mint condition gold coins that I’ve owned since before this big increase in gold price.
Passive Income Earner provides an overview. The only gold I own is a few mint condition gold coins that I’ve owned since before this big increase in gold price.
Consequences of Income Inequality
Monevator provides a balanced and well-written article on capitalism and income inequality that distances itself from either the far right wing or left wing politics.
Monevator provides a balanced and well-written article on capitalism and income inequality that distances itself from either the far right wing or left wing politics.
Good Financial Management is all about Good Change Management
“My Own Advisor” discusses why effectively dealing with change is so important.
“My Own Advisor” discusses why effectively dealing with change is so important.
Top Canadian Dividend Stocks
The Dividend Guy is a good resource for Canadian income investing.
The Dividend Guy is a good resource for Canadian income investing.
Socrates and the Next Generation of Wealth
Andrew Hallam, author of Millionaire Teacher, discusses the raw power of compounding.
Andrew Hallam, author of Millionaire Teacher, discusses the raw power of compounding.
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