06-18-2016, 10:23 PM
Hello all. Im new here to post, but I've been lurking for a little while. I began DGI in 2013 a tiny bit. I hit a huge financial hardship very quickly after starting and had to put new investing on hold. My wife became seriously ill and I had to meet out of pocket max 3 years in a row at 10k per. So I am down 30k. She is much better now. The awesome thing is (besides her health!) the 2 companies I owned at the time and still own KO and SO, have been slowly churning away the dividends! I had not even looked at my brokerage account in over a year and I had a nice little stash of dividend money waiting to be deployed!
I now have 7 DGI stocks, company stock and options. The companies I currently own are KO, SO, CSCO, ADM, BNS, EMR, and JNJ. I have a bunch or CERN due to company matching and a small grant of options. I am unable to do anything with CERN at the moment. I have a 2 year waiting period and my earliest shares have 11 months left. When those come up I plan to convert some to DGI stocks.
I would like to hold 20-30 companies total. I am trying to find at least fair value companies with proven DGI history and solid financials. That is proving to be difficult at the moment. I'm sure everyone is struggling with this problem to varying degrees. I think I should have waited on a better price point for JNJ, but I will average down when the opportunity presents. All the others I feel I got a good or better prices. My holding timeline is forever unless dividends are cut, financials fall apart, some unexpected catastrophe like BP, or if a company doubles my investment I will take profits and redeploy elsewhere. I doubt the latter will happen with these types of names, but I have that criteria just in case.
I currently have new capital to deploy. So looking at my limited diversification I have a lot of options as far as sectors. I am heavy in tech with CSCO and CERN. Cerner is not a DGI stock but it is tech and a large part of my holdings. So I definitely don't want another tech stock at this point. I am looking at CF Industries, CF.
CF has been brutalized from a 52 week high of around $70 to the current price of $28.35. Their YOY last quarter was ugly so the bludgeoning was due, but I'm wondering if it is oversold. It is paying a $1.20 dividend with a yield of 4.35%. CF is sitting on $2.7B cash with $5.5B in debt, and a current ratio of 2.77%. The payout is 56.8%. There are serious headwinds with China and India in the nitrogen/potash game and commodities in the toilet. Inventories were high in the first quarter putting further downward pressure on revenue. I can go on but I'm sure you guys have better resources to look up the particulars.
So what is everyones opinion? Has CF bottomed and it's now a solid play in this area, or is it going lower and going to burn cash to remain alive? I honestly don't know, but it does look attractive at ~$28.
What else is on everyones radar as a core position with fair valuation? I am also considering TGT. I know about the boycott and bathroom issue. I don't really need to hear that. It is my opinion that is a non-issue that will disappear in a few months. Target has had much bigger problems such as Canada etc. I know retail is struggling badly right now but WMT can't be the only player in the Variety Store field. People are buying online (myself included) but underwear, toilet paper and Catsup are not usual online orders. Much easier to stop by TGT or WMT on the way home. What say you?
At any rate, thank you for all your opinions and advice. I am reading voraciously trying to learn from you experienced investors. I appreciate the contributions here by everyone immensely.
Ajohn
I now have 7 DGI stocks, company stock and options. The companies I currently own are KO, SO, CSCO, ADM, BNS, EMR, and JNJ. I have a bunch or CERN due to company matching and a small grant of options. I am unable to do anything with CERN at the moment. I have a 2 year waiting period and my earliest shares have 11 months left. When those come up I plan to convert some to DGI stocks.
I would like to hold 20-30 companies total. I am trying to find at least fair value companies with proven DGI history and solid financials. That is proving to be difficult at the moment. I'm sure everyone is struggling with this problem to varying degrees. I think I should have waited on a better price point for JNJ, but I will average down when the opportunity presents. All the others I feel I got a good or better prices. My holding timeline is forever unless dividends are cut, financials fall apart, some unexpected catastrophe like BP, or if a company doubles my investment I will take profits and redeploy elsewhere. I doubt the latter will happen with these types of names, but I have that criteria just in case.
I currently have new capital to deploy. So looking at my limited diversification I have a lot of options as far as sectors. I am heavy in tech with CSCO and CERN. Cerner is not a DGI stock but it is tech and a large part of my holdings. So I definitely don't want another tech stock at this point. I am looking at CF Industries, CF.
CF has been brutalized from a 52 week high of around $70 to the current price of $28.35. Their YOY last quarter was ugly so the bludgeoning was due, but I'm wondering if it is oversold. It is paying a $1.20 dividend with a yield of 4.35%. CF is sitting on $2.7B cash with $5.5B in debt, and a current ratio of 2.77%. The payout is 56.8%. There are serious headwinds with China and India in the nitrogen/potash game and commodities in the toilet. Inventories were high in the first quarter putting further downward pressure on revenue. I can go on but I'm sure you guys have better resources to look up the particulars.
So what is everyones opinion? Has CF bottomed and it's now a solid play in this area, or is it going lower and going to burn cash to remain alive? I honestly don't know, but it does look attractive at ~$28.
What else is on everyones radar as a core position with fair valuation? I am also considering TGT. I know about the boycott and bathroom issue. I don't really need to hear that. It is my opinion that is a non-issue that will disappear in a few months. Target has had much bigger problems such as Canada etc. I know retail is struggling badly right now but WMT can't be the only player in the Variety Store field. People are buying online (myself included) but underwear, toilet paper and Catsup are not usual online orders. Much easier to stop by TGT or WMT on the way home. What say you?
At any rate, thank you for all your opinions and advice. I am reading voraciously trying to learn from you experienced investors. I appreciate the contributions here by everyone immensely.
Ajohn