(07-11-2014, 10:14 AM)Dividend Watcher Wrote:(07-11-2014, 10:02 AM)EricL Wrote: I think AT&T is a great value here at a 5.2% yield and I think the Direct TV merger and new product cycle from Apple will help its growth and hopefully provide upside to the dividend payout.
Fairly valued here, IMO. The slow earnings & dividend growth aren't anything to write home about but they're not going anywhere. However, every 3 months, they throw a good chunk of money at me and if you reinvest that helps with the slow dividend growth.
There's a lot of potential there if the greedy bureaucracy would get out of the way -- DirectTV, Uverse, wireless, etc.
With the Direct TV acquisition I think it will add some more breathing room to the payout ratio and possibly allow for more like 4-5% dividend growth going forward.
If it can deliver 5% earnings growth at a fairly valued earnings multiple and I get to start with a 5.2% dividend yield, I think its about as sure a thing as an 8-10% total return as you can get. I'll take it in this market.
Much more predictable results than Potash gave me with them being reliant on a volatile fertilizer market for earnings.
I'm watching Lorillard and hoping a deal gets announced next week for around $70 per share. Would love to be able to sell out there, take the proceeds and start a position in a higher yielding utility.
Have also been doing some soul searching on Aflac. I think the high growth days are over in the near term as Japan slogs along and interest rates stay low. I think there are more certain LYHG stocks out there that can give me a better growth on a 2.4% yield.