Thoughts on the Non-Taper Taper?

[TomK]

So any initial reactions to the Fed's decision to ever-so-slightly begin to taper its asset-buying (from $85 billion per month to $75 billion per month)? They also indicated much more affirmatively that interest rates are very likely going to stay really low for a fair while longer.

I'd think that together, these would be very bullish signals for the market. But except for yesterday's moderate pop, the reaction seems to be ho-hum.

[hendi_alex]

The market is already toppy according to historical standards. Is it reasonable to expect some dramatic acceleration in corporate earnings in 2014. I think not, and absent strong earnings, what will be the driver, other than continued kool aid from the Fed.

[rnsmth]

There are undervalued stocks there. For dividend growth investors it is not a stock market, it is a market of stocks.

There are almost always good buys out there.

[hendi_alex]

What is your short list of 'under valued' stocks? I fail to see any. Most all conservative DG types of stocks are sporting p/e's of 18-20 or higher and anything with a lower p/e, for the most part, is discounted for good reasons.

[rnsmth]

(12-19-2013, 09:43 PM)hendi_alex Wrote: What is your short list of 'under valued' stocks? I fail to see any. Most all conservative DG types of stocks are sporting p/e's of 18-20 or higher and anything with a lower p/e, for the most part, is discounted for good reasons.

RCI, DE, AAPL, CVX, SE, UL, HCN, KMI, O, SO, MCD, PM [edited to remove GE from list - it is at fair value now]

All of these are undervalued when compared to Morningstar's fair value estimate. Most of them are at least 8% below that estimate. I own 9 of them.

I did not look them up on FAST Graphs, a tool I recently subscribed to that shows a lot of promise. I also subscribe to Morningstar's DividendInvestor newsletter. These are the only two paid subscriptions I have to help me with investing. In my view, they are both well worth the money.

[rnsmth]

Baxter is another dividend name that is undervalued

Article by Dividend Mantra

Morningstar has a fair value of $80.

[Dividend Watcher]

Man, this is a large and overheated topic.

Overall, I think it's a good thing and I think the Fed is going about it in a calculated, logical manner. I think the greatest danger the economy faced was radical changes in any monetary policy.

I was tempted to add a lot more but, after reviewing my position which covered points going back over 100 years, I think I'll stop here and see what, if anything, others add.

As for the undervalued stocks, I think Helmerich & Payne (HP) is at the bottom range of fairly valued if not a little undervalued right now. Just added some to my portfolio this past week. The last dividend boost added to my opinion.