One of my pet peeves as an investor is the financial media's love of "earnings" or "net income". Earnings are not a good way to measure a business' success. They are often volatile and manipulated by management for short term gain or saving face. In fact, as a finance student, the first thing you learn … Continue reading Choose your Dividend Payout Ratio Wisely: Free Cash Flow vs Income
I recently wrote an article on the Art and Science of Valuation. There's several components to it so I wanted to break down how to calculate a company's Cost of Equity. Why would you want to know Cost of Equity? Because the cost of equity is used to discount a company's future cash flow into … Continue reading Calculating Cost of Equity with the Capital Asset Pricing Model (CAPM)
In Finance 101, the first thing that you learn about is the "Time Value of Money". Essentially, it means that a dollar today is worth more than a dollar tomorrow. The rest of the course of Finance 101 is to determine how to value different types of securities. Let's do a quick overview into valuing … Continue reading The Art and Science of Stock Valuation
With the market falling like a rock, I was able to make a purchase I've been wanting to make for a while, but didn't properly fit into my income strategy; Texas Instruments. TXN is a semiconductor company that has a strong history and is financially very stable. While it has a relatively low yield (for … Continue reading New Purchase: Texas Instruments
If you follow dividend investing and REITs in particular, one name will almost always pop up as a solid dividend payer: Realty Income $O. Rightly so! Realty Income pays monthly dividends and has raised its dividend for the last 26 years. But is it a right fit for someone looking to grow dividends aggressively? Let’s look … Continue reading Is Realty Income a Dividend Cultivator REIT?
Whoa! Not a REIT? That's right! I purchased a boring stodgy telecom for my after-tax dividend growth portfolio. REITs have started 2018 with a bang rising ~12% with investors seemingly seeking safety and security. With that run up though, I could not find any suitable REITs that were fairly valued or had a dividend that … Continue reading New Dividend Growth Purchase: AT&T