What Did You Buy Today?

[EricL]

(09-19-2019, 02:57 PM)Kerim Wrote:

(09-19-2019, 01:49 PM)Otter Wrote:

(09-19-2019, 01:22 PM)stockguru Wrote: MO in a free fall. Lets hope a year from now we will all say what a great buy it was lol

Single-digit P/E, 5yr lows, 8.5% yield . . . panic like this is where the long-term money gets made.

Any MO shares you buy today will pay you back their entire value in a decade just with dividends. 

Am considering transferring some funds out of a savings account to buy even more.

I just bought more MO as well, again. It is certainly hardest to buy when there is this much negativity, but it is just too cheap to ignore. Assuming no dividend cuts, just locked in 8.39 percent yield. Yeah, I'll take that.

Edit to add: And I don't think that dividend cuts are off the table with MO either. Their stated policy is to target an 80 percent payout ratio. By my math, for 2019 it could be over 90 percent. Yes, I think things would have to get *much* worse for them to actually cut (as opposed to slowing significantly until EPS catches up), but it is not unthinkable. (And the potential PM merger is a huge wild card...)

How are you getting 90%?

The recent dividend raise was to $3.36 and they are expected to earn $4.20 in 2019, which is exactly an 80% payout ratio.