04-25-2015, 05:47 AM
Random sounding topic, I know. But I'm about to have some available capital and I can't decide which would make a better "secondary" purchase (I always try to buy two stocks, but rarely do I split my money 50/50 between them). I've been looking at GE first and then RDS-B and I can't decide.
With GE, I'm loving the return to its industrial roots. Selling off the bulk of its financial assets is a wise move (leave the banking to the banks), but the costs involved are so high from what I understand that it might impact dividend growth for the next couple years? Plus, I'm looking at their financials on Yahoo Finance and I see a debt load that is higher than their market cap. I expect a company that deals with industrials and lending to be capital intensive and have a higher debt load that your local florist, sure, but more debt than the company is worth. Will this debt load unloaded with the rest of the GE Capital assets (I've noticed that many banks share the same characteristic of perpetually high debt, and GE is selling off their "banking" parts), or do they at least have plans do anything about this debt with the incoming cash from the sales?
With RDS-B, I can see that their purchase of BG Group will make them one of the biggest energy players in the world. I vaguely remember reading that they'll be the second biggest one or something, I'm not sure. But then I saw on Yahoo Finance (again) that their forward dividend is less than their current one? Makes sense, I guess, considering the consensus that they overpaid for BG's assets. But I'm a dividend GROWTH investor! Unfortunately, I haven't had time to do any in depth research, so I was wondering if anybody knew what was up with this? As for the depressed oil prices (it's an obligation to talk about them nowadays whenever someone brings up investing in energy), I could care less about those. It's nothing about a macroeconomic factor that makes the companies more attractively valued. I'll worry about the price of oil the day I go out and buy oil drums. I'm more concerned about the company right now.
So, GE or RDS-B? I'm so indecisive. What do you guys think? Or maybe I should just invest more into JNJ now that they announced a 7% dividend raise.
With GE, I'm loving the return to its industrial roots. Selling off the bulk of its financial assets is a wise move (leave the banking to the banks), but the costs involved are so high from what I understand that it might impact dividend growth for the next couple years? Plus, I'm looking at their financials on Yahoo Finance and I see a debt load that is higher than their market cap. I expect a company that deals with industrials and lending to be capital intensive and have a higher debt load that your local florist, sure, but more debt than the company is worth. Will this debt load unloaded with the rest of the GE Capital assets (I've noticed that many banks share the same characteristic of perpetually high debt, and GE is selling off their "banking" parts), or do they at least have plans do anything about this debt with the incoming cash from the sales?
With RDS-B, I can see that their purchase of BG Group will make them one of the biggest energy players in the world. I vaguely remember reading that they'll be the second biggest one or something, I'm not sure. But then I saw on Yahoo Finance (again) that their forward dividend is less than their current one? Makes sense, I guess, considering the consensus that they overpaid for BG's assets. But I'm a dividend GROWTH investor! Unfortunately, I haven't had time to do any in depth research, so I was wondering if anybody knew what was up with this? As for the depressed oil prices (it's an obligation to talk about them nowadays whenever someone brings up investing in energy), I could care less about those. It's nothing about a macroeconomic factor that makes the companies more attractively valued. I'll worry about the price of oil the day I go out and buy oil drums. I'm more concerned about the company right now.
So, GE or RDS-B? I'm so indecisive. What do you guys think? Or maybe I should just invest more into JNJ now that they announced a 7% dividend raise.